Interlock PrayerNet

GOODBYE TO A GREAT ONE: Tribute to Peter Drucker by Larry Stout

If you had asked me two weeks ago, “Larry, name the one person on the planet you would most want to spend one hour of conversation” – my answer would have been Peter Drucker.  This one man almost single-handedly transformed everything we believe about the science of management.  It would not be an exaggeration to state that every single writer on the subject of management in the 20^th century owes a debt to this man.  (I know I do!) Unfortunately, I now will never get that opportunity, because on November 11th, this great man died.  He was 95, and incredibly, he was active to the very end. 

Peter Drucker was born in Vienna, Austria in November of 1909.  After receiving his doctorate in Public and International Law from Frankfurt University in Germany, he worked as an economist and journalist in London before moving to the United States in 1937. 

Just two years later, in 1939, he published his first book, The End of Economic Man. In that book he attempted to explain the philosophy behind totalitarianism, particularly Fascism and Nazism.  Amazingly, this book, as well as his other 34 books written over the next sixty plus years, are still being reprinted and quoted today.  His works covered all aspects of society, economics, and politics.  His most recent book, Managing in the Next Society, was published in the fall of 2002. 

Drucker’s books are astounding in their insights into the world of business, and how it impacted society.  He always seemed to have the uncanny ability to predict the next wave that would hit the business world.  For example, he was one of the first to recognize that the world was entering into a knowledge-based society where the focus of work and the ways that work is organized would have to be totally transformed. 

But these insights from his writings alone are not what raise Drucker to the stratosphere of esteem.  As one colleague of his commented, “What distinguishes Peter Drucker from many other thought leaders in my mind is that he cared not just about how business manages its resources, but also how public and private organizations operate morally and ethically within society.  He respected the values of education, personal responsibility, and business’ accountability to society.  His true legacy is his insistence on this value system, and its effect on business, society, and individual lives.”

He not only taught and wrote about it – he lived it.  He had worked in New York University’s Graduate Business School as Professor of Management from 1950 to 1971. At that point, he was arguably the most respected professor in his field in the world.  He could have gone to Harvard Business School or the London School of Business – but instead he chose to work at tiny Claremont Graduate University in Claremont, California.  He went there because they shared his philosophy that management is a liberal art—one that takes into account not only economics, but also history, social theory, law, and the sciences.  His integrating vision inspired managers all over the world to think beyond business, but also to think of the social responsibility to society at large. 

Nowhere was this concept clearer than in his concept of profit.  Though he felt that every business owed a reasonable return to its shareholders, he knew that profit motive alone was deceiving.  He wrote for the Wall Street Journal in 1975, “There is no such thing as ‘profit.’  There are only ‘costs’: costs of doing business and costs of staying in business, costs of labor and raw materials, and costs of capital; costs of today’s jobs and costs of tomorrow’s jobs and tomorrow’s pensions.  There is no conflict between ‘profit’ and ‘social responsibility.’  To earn enough to cover the genuine costs which only the so-called ‘profit’ can cover, is economic and social responsibility – indeed, it is the specific social and economic responsibility of business.  It is not the business that earns a profit adequate to its genuine costs of capital, to the risks of tomorrow and to the needs of tomorrow’s worker and pensioner that ‘rips off’ society.  It is the business that fails to do so.”  

In 1990, Peter Drucker shocked the business world by essentially leaving business – and devoting his life to development of non-profit organizations.  He saw that government was not the answer to social problems.  (In fact he wrote once, “Of all government [social] programs of the last 40 years, not one has worked.”)  The goal he set in 1990 was to triple the effectiveness of nonprofit institutions and doubling their share of the GNP.  These were ambitious goals but he spent the rest of his life trying to fulfill them. 

Peter Drucker’s career as a writer, consultant and teacher spanned an incredible 75 years.  His groundbreaking work turned modern management theory into a serious discipline.  I probably quote him more than any other writer outside of the Bible.  Without using the name of Jesus, Peter Drucker presented a worldview that could in every sense of the word be considered Biblical.  My prayers are with his wife of 68 years, Doris, and their four children and six grandchildren, and all of those who were close to this extraordinary man.  He was a great teacher, a great writer, and a great man.  I never knew him personally, but he was one of the great influences on my thinking in management.  I will miss you, Peter.