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Born	Peter Ferdinand Drucker November 19, 1909
Died	November 11, 2005 (aged 95)
Alma mater	Goethe University Frankfurt (PhD)
Occupation	Management consultant, educator and author
Awards	Henry Laurence Gantt Medal (1959) Austrian Cross of Honour for Science and Art, 1st class (1991) Presidential Medal of Freedom (2002)

Managing Oneself (Harvard Business Review Classics) 1 Peter Ferdinand Drucker Managing Oneself (Harvard Business Review Classics) We live in an age of unprecedented opportunity: with ambition, drive, and talent, you can rise to the top of your chosen profession regardless of where you started out But with opportunity comes responsibility.

In this paper we will ﬁrst set out the main sources for UK management theory and then outline some of the criticisms of the mechanistic models from which these ideas are derived. We will consider three theorists who have each taken a diﬀerent view of management — Drucker,DemingandVickers—andone,StaﬀordBeer,who,whileworkinglargelywithina. Peter Drucker is world-renowned for his innovative thinking in the ways of business management. His work turned management theory into a serious discipline among sociologists and he participated in nearly every aspect of management theory development.

Peter Drucker is world-renowned for his innovative thinking in the ways of business management. His work turned management theory into a serious discipline among sociologists and he participated in nearly every aspect of management theory development. The practice of business ethics and morals was.
Peter Drucker was an Austrian-born American management thought leader who, it is no exaggeration to say, revolutionised the perception of business management. Drucker’s innovative thinking transformed management theory into a considerable discipline amongst sociologists, with the practice of business ethics and morals high up on his priorities.
Feb 27, 2018 Peter Drucker, also known as the Father of Modern Management Theory, coined terms and strategies that are still used today. Peter Drucker, also known as the Father of Modern Management Theory, coined leadership terms and strategies that are still used today.
While Peter F. Drucker has been widely published since the late 1940s, his ideas hardly appear to have aﬀected American or European management. Edwards Deming only got intoprintinthelastquarterofthetwentiethcenturybuthisideasunderpinnedthesuccessof the US war eﬀort in the 1940s and Japanese industry after the war and the Deming prize is.

Peter Ferdinand Drucker (/ˈdrʌkər/; German: [ˈdʀʊkɐ]; November 19, 1909 – November 11, 2005) was an Austrian-born American management consultant, educator, and author, whose writings contributed to the philosophical and practical foundations of the modern business corporation. He was also a leader in the development of management education, he invented the concept known as management by objectives and self-control,^[1] and he has been described as 'the founder of modern management'.^[2]

Drucker's books and scholarly and popular articles explored how humans are organized across the business, government, and nonprofit sectors of society.^[3] He is one of the best-known and most widely influential thinkers and writers on the subject of management theory and practice. His writings have predicted many of the major developments of the late twentieth century, including privatization and decentralization; the rise of Japan to economic world power; the decisive importance of marketing; and the emergence of the information society with its necessity of lifelong learning.^[4] In 1959, Drucker coined the term 'knowledge worker,' and later in his life considered knowledge-worker productivity to be the next frontier of management.^[5] Drucker gave his name to three institutions^[6] and the annual Global Peter Drucker Forum, held in his hometown of Vienna, honors his legacy.

2Work and philosophy
5Bibliography

Biography[edit]

Drucker grew up in what he referred to as a 'liberal' Lutheran Protestant household in Austria-Hungary.^[7] His mother Caroline Bondi had studied medicine and his father Adolf Drucker was a lawyer and high-level civil servant.^[8] Drucker was born in Vienna, Austria, in a small village named Kaasgraben (now part of the 19th district of Vienna-Döbling).^[9] He grew up in a home where intellectuals, high government officials, and scientists would meet to discuss new ideas.^[10] These included Joseph Schumpeter, Friedrich Hayek and Ludwig von Mises. Hans Kelsen was his uncle.^[11]

After graduating from Döbling Gymnasium in 1927,^[11] Drucker found few opportunities for employment in post-World War I Vienna, so he moved to Hamburg, Germany, first working as an apprentice at an established cotton trading company, then as a journalist, writing for Der Österreichische Volkswirt (The Austrian Economist).^[8] Drucker then moved to Frankfurt, where he took a job at the Daily Frankfurter General-Anzeiger.^[12] While in Frankfurt, he also earned a doctorate in international law and public law from the Goethe University Frankfurt in 1931.^[13]

In 1933, Drucker left Germany for England.^[14] In London, he worked for an insurance company, then as the chief economist at a private bank.^[15] He also reconnected with Doris Schmitz, an acquaintance from the University of Frankfurt, and they married in 1934.^[16] The couple permanently relocated to the United States, where he became a university professor as well as a freelance writer and business consultant.

In 1943, Drucker became a naturalized citizen of the United States. He then had a distinguished career as a teacher, first as a professor of politics and philosophy at Bennington College from 1942 to 1949, then twenty-two years at New York University as a Professor of Management from 1950 to 1976.

Drucker went to California in 1971, where he developed one of the country's first executive MBA programs for working professionals at Claremont Graduate University (then known as Claremont Graduate School). From 1971 until his death, he was the Clarke Professor of Social Science and Management at Claremont.^[17] Claremont Graduate University's management school was named the Peter F. Drucker Graduate School of Management in his honor in 1987 (later renamed the Peter F. Drucker and Masatoshi Ito Graduate School of Management). He established the Drucker Archives at Claremont Graduate University in 1999; the Archives became the Drucker Institute in 2006. Drucker taught his last class in 2002 at age 92. He continued to act as a consultant to businesses and nonprofit organizations well into his nineties.

Drucker died November 11, 2005 in Claremont, California of natural causes at 95.^[18] He had four children and is the grandfather of tech entrepreneur Nova Spivack, one of six grandchildren.^[19]^[20] Drucker's wife Doris died in October 2014 at the age of 103.^[21]

Work and philosophy[edit]

Early influences[edit]

Among Drucker's early influences was the Austrian economist Joseph Schumpeter, a friend of his father's, who impressed upon Drucker the importance of innovation and entrepreneurship.^[22] Drucker was also influenced, in a much different way, by John Maynard Keynes, whom he heard lecture in 1934 in Cambridge.^[23] 'I suddenly realized that Keynes and all the brilliant economic students in the room were interested in the behavior of commodities,' Drucker wrote, 'while I was interested in the behavior of people.'^[24]

Over the next 70 years, Drucker's writings would be marked by a focus on relationships among human beings, as opposed to the crunching of numbers. His books were filled with lessons on how organizations can bring out the best in people, and how workers can find a sense of community and dignity in a modern society organized around large institutions.^[3] As a business consultant, Drucker disliked the term 'guru,' though it was often applied to him; 'I have been saying for many years,' Drucker once remarked, 'that we are using the word 'guru' only because 'charlatan' is too long to fit into a headline.'^[25]

As a young writer, Drucker wrote two pieces — one on the conservative German philosopher Friedrich Julius Stahl and another called 'The Jewish Question in Germany' — that were burned and banned by the Nazis.^[4] In 1939 he published a contemporary analysis of the rise of fascism called 'The End of Economic Man'. This was his first book, published in New York, in English. In the introduction he refers to 'The Jewish Question in Germany' saying 'An early excerpt [of this book] was published as a pamphlet by an Austrian Catholic and Anti-Nazi in .. 1936'. ^[26]

The 'business thinker'[edit]

Drucker's career as a business thinker took off in 1942, when his initial writings on politics and society won him access to the internal workings of General Motors (GM), one of the largest companies in the world at that time. His experiences in Europe had left him fascinated with the problem of authority. He shared his fascination with Donaldson Brown, the mastermind behind the administrative controls at GM. In 1943 Brown invited him in to conduct what might be called a 'political audit': a two-year social-scientific analysis of the corporation. Drucker attended every board meeting, interviewed employees, and analyzed production and decision-making processes.

The resulting book, Concept of the Corporation, popularized GM's multidivisional structure and led to numerous articles, consulting engagements, and additional books. GM, however, was hardly thrilled with the final product. Acdsee pro 3 free download. Drucker had suggested that the auto giant might want to re-examine a host of long-standing policies on customer relations, dealer relations, employee relations and more. Inside the corporation, Drucker's counsel was viewed as hypercritical. GM's revered chairman, Alfred Sloan, was so upset about the book that he 'simply treated it as if it did not exist,' Drucker later recalled, 'never mentioning it and never allowing it to be mentioned in his presence.'^[27]

Drucker taught that management is 'a liberal art,' and he infused his management advice with interdisciplinary lessons from history, sociology, psychology, philosophy, culture and religion.^[3] He also believed strongly that all institutions, including those in the private sector, have a responsibility to the whole of society. 'The fact is,' Drucker wrote in his 1973 Management: Tasks, Responsibilities, Practices, 'that in modern society there is no other leadership group but managers. If the managers of our major institutions, and especially of business, do not take responsibility for the common good, no one else can or will.'^[28]

Drucker was interested in the growing effect of people who worked with their minds rather than their hands. He was intrigued by employees who knew more about certain subjects than their bosses or colleagues, and yet had to cooperate with others in a large organization. Rather than simply glorify the phenomenon as the epitome of human progress, Drucker analyzed it, and explained how it challenged the common thinking about how organizations should be run.

His approach worked well in the increasingly mature business world of the second half of the twentieth century. By that time large corporations had developed the basic manufacturing efficiencies and managerial hierarchies of mass production. Executives thought they knew how to run companies, and Drucker took it upon himself to poke holes in their beliefs, lest organizations become stale. But he did so in a sympathetic way. He assumed that his readers were intelligent, rational, hardworking people of good will. If their organizations struggled, he believed it was usually because of outdated ideas, a narrow conception of problems, or internal misunderstandings.

Drucker developed an extensive consulting business built around his personal relationship with top management. He became legendary among many of post-war Japan's new business leaders trying to rebuild their war-torn homeland. He advised the heads of General Motors, Sears, General Electric, W.R. Grace and IBM, among many others. Over time he offered his management advice to nonprofits like the American Red Cross and the Salvation Army. His advice was eagerly sought by the senior executives of the Adela Investment Company, a private initiative of the world's multinational corporations to promote investment in the developing countries of Latin America.^[29]

Drucker's writings[edit]

Drucker's 39 books have been translated into more than thirty-six languages. Two are novels, one an autobiography. He is the co-author of a book on Japanese painting, and made eight series of educational films on management topics. He also penned a regular column in the Wall Street Journal for 10 years and contributed frequently to the Harvard Business Review, The Atlantic Monthly, and The Economist.

His work is especially popular in Japan, even more so after the publication of 'What If the Female Manager of a High-School Baseball Team Read Drucker's Management', a novel that features the main character using one of his books to great effect, which was also adapted into an anime and a live action film.^[30] His popularity in Japan may be compared with that of his contemporary W. Edwards Deming.^[31]

Key ideas[edit]

Decentralization and simplification.^[32] Drucker discounted the command and control model and asserted that companies work best when they are decentralized. According to Drucker, corporations tend to produce too many products, hire employees they don't need (when a better solution would be outsourcing), and expand into economic sectors that they should avoid.
The prediction of the death of the 'Blue Collar' worker.^[33] The changing face of the US Auto Industry is a testimony to this prediction.
The concept of what eventually came to be known as 'outsourcing.'^[34] He used the example of 'front room' and 'back room' of each business: A company should be engaged in only the front room activities that are critical to supporting its core business. Back room activities should be handed over to other companies, for whom these tasks are the front room activities.
The importance of the nonprofit sector,^[35] which he calls the third sector (private sector and the Government sector being the first two). Non-Government Organizations (NGOs) play crucial roles in the economies of countries around the world.
A profound skepticism of macroeconomic theory.^[36] Drucker contended that economists of all schools fail to explain significant aspects of modern economies.
A lament that the sole focus of microeconomics is price, citing its lack of showing what products actually do for us,^[37] thereby stimulating commercial interest in discovering how to calculate what products actually do for us, from their price.^[38]
Respect for the worker. Drucker believed that employees are assets not liabilities. He taught that knowledgeable workers are the essential ingredients of the modern economy, and that a hybrid management model is the sole method of demonstrating an employee's value to the organization. Central to this philosophy is the view that people are an organization's most valuable resource, and that a manager's job is both to prepare people to perform and give them freedom to do so.^[39]
A belief in what he called 'the sickness of government.' Drucker made nonpartisan claims that government is often unable or unwilling to provide new services that people need and/or want, though he believed that this condition is not intrinsic to the form of government. The chapter 'The Sickness of Government'^[40] in his book The Age of Discontinuity formed the basis of New Public Management,^[41] a theory of public administration that dominated the discipline in the 1980s and 1990s.
The need for 'planned abandonment.' Businesses and governments have a natural human tendency to cling to 'yesterday's successes' rather than seeing when they are no longer useful.^[42]
A belief that taking action without thinking is the cause of every failure.
The need for community. Early in his career, Drucker predicted the 'end of economic man' and advocated the creation of a 'plant community'^[43] where an individual's social needs could be met. He later acknowledged that the plant community never materialized, and by the 1980s, suggested that volunteering in the nonprofit sector was the key to fostering a healthy society where people found a sense of belonging and civic pride.^[44]
The need to manage business by balancing a variety of needs and goals, rather than subordinating an institution to a single value.^[45]^[46] This concept of management by objectives and self-control forms the keynote of his 1954 landmark The Practice of Management.^[47]
A company's primary responsibility is to serve its customers. Profit is not the primary goal, but rather an essential condition for the company's continued existence and sustainability.^[48]
A belief in the notion that great companies could stand among humankind's noblest inventions.^[49]
'Do what you do best and outsource the rest' is a business tagline first 'coined and developed'^[50] in the 1990s by Drucker.^[51] The slogan was primarily used to advocate outsourcing as a viable business strategy. Drucker began explaining the concept of outsourcing as early as 1989 in his Wall Street Journal (WSJ) article entitled 'Sell the Mailroom.'^[52]

Criticism[edit]

The Wall Street Journal researched several of his lectures in 1987 and reported that he was sometimes loose with the facts. Drucker was off the mark, for example, when he told an audience that the English language was the official language for all employees at Japan's Mitsui trading company. Drucker defended himself: 'I use anecdotes to make a point, not to write history.'

Also, while Drucker was known for his prescience, he was not always correct in his forecasts. He predicted, for instance, that the nation's financial center would shift from New York to Washington.^[53]

Others maintain that one of Drucker's core concepts,' management by objectives,' is flawed and has never really been proven to work effectively. Critic Dale Krueger said that the system is difficult to implement and that companies often wind up overemphasizing control, as opposed to fostering creativity, to meet their goals.^[54]

Drucker's classic work, Concept of the Corporation, criticized General Motors while it was considered the most successful corporation in the world. Many of GM's executives considered Drucker persona non grata for a long time afterward. Although Alfred P. Sloan refrained from personal hostility toward Drucker, he considered Drucker's critiques of GM's management to be 'dead wrong.'^[55]

Awards and honors[edit]

Drucker was awarded the Presidential Medal of Freedom by US President George W. Bush on July 9, 2002.^[56] He also received honors from the governments of Austria,^[57] including the Grand Silver Medal for Services to the Republic of Austria in 1974,^[58] the Grand Gold Decoration for Services to the Republic of Austria in 1991^[59] and the Austrian Cross of Honour for Science and Art, 1st class in 1999^[60] and Japan (Order of the Sacred Treasure, 3rd class; 24 June 1966^[61]).

Drucker was the Honorary Chairman of the Peter F. Drucker Foundation for Nonprofit Management, now the Leader to Leader Institute, from 1990 through 2002.^[62] In 1969 he was awarded New York University's highest honor, its Presidential Citation.^[63] For his article, 'What Makes an Effective Executive', Harvard Business Review honored Drucker in the June 2004 with his seventh McKinsey Award — the most awarded to one person.^[64] Drucker was inducted into the Junior Achievement US Business Hall of Fame in 1996.^[65] He received 25 honorary doctorates from American, Belgian, Czech, English, Spanish and Swiss universities.^[66] His 1954 book The Practice of Management was voted the third most influential management book of the 20th century in a poll of the Fellows of the Academy of Management.^[67] In Claremont, California, Eleventh Street between College Avenue and Dartmouth Avenue was renamed 'Drucker Way' in October 2009 to commemorate the 100th anniversary of Drucker's birth.^[68]Drucker was posthumously honored when he was inducted into the Outsourcing Hall of Fame in recognition of his outstanding contributions in the field.^[69] In 2018, Drucker was named the world's most influential business thinker on the Thinkers50.com list.^[70]

Bibliography[edit]

1939: The End of Economic Man (New York: The John Day Company)
1942: The Future of Industrial Man (New York: The John Day Company)
1946: Concept of the Corporation (New York: The John Day Company)
1950: The New Society (New York: Harper & Brothers)
1954: The Practice of Management (New York: Harper & Brothers)
1957: America's Next Twenty Years (New York: Harper & Brothers)
1959: The Landmarks of Tomorrow (New York: Harper & Brothers)
1964: Managing for Results (New York: Harper & Row)
1967: The Effective Executive (New York: Harper & Row)
1969: The Age of Discontinuity (New York: Harper & Row)
1970: Technology, Management and Society (New York: Harper & Row)
1971: The New Markets and Other Essays (London: William Heinemann Ltd.)
1971: Men, Ideas and Politics (New York: Harper & Row)
1971: Drucker on Management (London: Management Publications Limited)
1973: Management: Tasks, Responsibilities, Practices' (New York: Harper & Row)
1976: The Unseen Revolution: How Pension Fund Socialism Came to America (New York: Harper & Row)
1977: People and Performance: The Best of Peter Drucker on Management (New York: Harper's College Press)
1978: Adventures of a Bystander (New York: Harper & Row)
1980: Managing in Turbulent Times (New York: Harper & Row)
1981: Toward the Next Economics and Other Essays (New York: Harper & Row)
1982: The Changing World of Executive (New York: Harper & Row)
1982: The Last of All Possible Worlds (New York: Harper & Row)
1984: The Temptation to Do Good (London: William Heinemann Ltd.)
1985: Innovation and Entrepreneurship (New York: Harper & Row)
1986: The Frontiers of Management: Where Tomorrow's Decisions are Being Shaped Today (New York: Truman Talley Books/E.D. Dutton)
1989: The New Realities: in Government and Politics, in Economics and Business, in Society and World View (New York: Harper & Row)
1990: Managing the Nonprofit Organization: Practices and Principles (New York: Harper Collins)
1992: Managing for the Future (New York: Harper Collins)
1993: The Ecological Vision (New Brunswick, NJ and London: Transaction Publishers)
1993: Post-Capitalist Society (New York: HarperCollins)
1995: Managing in a Time of Great Change (New York: Truman Talley Books/Dutton)
1997: Drucker on Asia: A Dialogue between Peter Drucker and Isao Nakauchi (Tokyo: Diamond Inc.)
1998: Peter Drucker on the Profession of Management (Boston: Harvard Business School Publishing)
1999: Management Challenges for 21st Century (New York: Harper Business)
1999: Managing Oneself (Boston: Harvard Business School Publishing) [published 2008 from article in Harvard Business Review]
2001: The Essential Drucker (New York: Harper Business)
2002: Managing in the Next Society (New York: Truman Talley Books/St. Martin's Press)
2002: A Functioning Society (New Brunswick, NJ and London: Transaction Publishers)
2004: The Daily Drucker (New York: Harper Business)
2008 (posthumous): The Five Most Important Questions (San Francisco: Jossey-Bass)

Other publications[edit]

Early monographs in German

1932: The Justification of International Law and the Will of the State (doctoral dissertation)
1933: Friedrich Julius Stahl, Conservative Political Theory and Historical Development (Tübingen: Mohr)
1936: The Jewish Question in Germany (Wien: Gsur)

Contributing writer

1961: Power and Democracy in America (Westport, Connecticut: Greenwood Press Publishers)
1969: Preparing Tomorrow's Business Leaders Today (Englewood Cliffs, NJ: Prentice Hall)
1979: Song of the Brus: Japanese Painting from Sanso Collection (Seattle: Seattle Art Museum)
1988: Handbook of Management by Objectives with Bill Reddin and Denis Ryan (Published by Tata Mcgraw-Hill in New Delhi).
1991: The Rise of NEC (Blackwell Business)

Miscellaneous

1977: An Introductory View of Management (New York: Harper & Row)
1977 (revised edition, 2009): Management Cases (New York: Harper & Row)
2006: The Effective Executive In Action with Joseph A. Maciariello (New York: HarperCollins)
2006: Classic Drucker (Boston: Harvard Business Review Press)
2008 (posthumous): Management: Revised with sujog arya (New York: HarperCollins)

References[edit]

^Drucker, Peter F. 'Reflections of a Social Ecologist,' Society, May/June 1992.
^Denning, Steve (August 29, 2014). 'The Best Of Peter Drucker'. Forbes.
^ ^a^b^cWhy Drucker Now?, Drucker Institute.
^ ^a^bByrne, John A.; Gerdes, Lindsey (November 28, 2005). 'The Man Who Invented Management'. BusinessWeek. Retrieved November 2, 2009.
^Davenport, Thomas H. Thinking for a Living, 2005, p. 8.
^Schumpeter (19 November 2009). 'Remembering Drucker'. The Economist. Retrieved 15 March 2012.
^Drucker, Peter F., The Ecological Vision: Reflections on the Human condition, 2016, p. 425.
^ ^a^bDrucker, Peter F. Adventures of a Bystander, 1979.
^Peter F. Drucker: A Biography in Progress, p. 1, at his website
^Beatty, Jack. The World According to Peter Drucker, 2016, pp. 5–7.
^ ^a^b'Drucker's childhood and youth in Vienna'. Drucker Society of Austria. Drucker Society of Austria. Retrieved 2 August 2015.
^Drucker, Peter F. Adventures of a Bystander, 1979, p. 159.
^'Obituary: Peter Drucker, 95, Economist Who Prized Value of Workers,' The New York Times, 13 November 2005.
^Drucker, Peter F.;Cohen, William. A Class with Drucker: The Lost Lessons of the World's Greatest Management Teacher, 2007, p. 242.
^Peter F. Drucker: A Biography in Progress, p. 6, at this website
^Certified copy of Peter and Doris Drucker’s marriage certificate, The Drucker Institute Archives, Box 39, Folder 11, Claremont, California.
^The Essential Drucker (2001)
^Sullivan, Patricia (November 12, 2005). 'Management Visionary Peter Drucker Dies'. Washington Post.
^'Peter F. Drucker'. Claremont Graduate University. Archived from the original on 27 August 2006. Retrieved 24 March 2014.
^Pattison, Kermit (9 December 2008). 'The Twine That Binds: Q&A With Nova Spivack'. Fast Company. Retrieved 24 March 2014.
^Colker, David (October 4, 2014). 'Doris Drucker dies at 103; memoirist and wife of Peter Drucker'. Los Angeles Times. Retrieved 14 October 2015.
^Beatty, Jack. The World According to Peter Drucker, 1998, p. 163.
^Drucker, Peter F. The Ecological Vision: Reflections on the Human Condition, 1993, p. 75.
^Drucker, Peter F., The Ecological Vision, 1993, pp. 75–76.
^'Peter Drucker, the man who changed the world,' Business Review Weekly, 15 September 1997, p. 49.
^'The End of Economic Man, Introduction to the Transaction Edition' Transaction Publishing, 2009.
^Drucker, Peter F., Adventures of a Bystander, p. 288, (1979)
^Drucker, Peter F., Management: Tasks, Responsibilities, Practices, 1973, p. 325.
^Wartzman, Rick. 'How to Consult Like Peter Drucker'. Forbes.
^Drucker in the dug-out, A Japanese book about Peter Drucker and baseball is an unlikely hit, The Economist, July 1, 2010
^Outcome-Based Religions: Purpose-Driven Apostasy, Mac Dominick, 'The quest begins by looking into the lives of two men, Edwards Deming and Peter Drucker. Deming (now deceased) and Drucker (in his mid 90s) are enshrined as internationally renowned experts in business management and gurus of business methodology. These two individuals were among the primary players in a select group of Americans (Though Drucker is a U.S. citizen, he is actually Austrian.) who are lauded as part of the almost super-human effort that developed systems-based management philosophies that first gained public recognition in post-World War II Japan. The popular story is told of the Americans who developed a cutting edge business methodology that was rejected by western business but eagerly embraced by the Japanese.', quoted at Total Quality Management (TQM)
^Buchanan, Leigh (19 November 2009). 'Peter Drucker from A to Z'. Inc. magazine. Retrieved 12 March 2012.
^Drucker, Peter (December 1995). 'The Age of Social Transformation'. The Atlantic. Retrieved 12 March 2012.
^Wartzman, Rick (5 February 2010). 'Insourcing and Outsourcing: the Right Mix'. Bloomberg Businessweek. Retrieved 12 March 2012.
^Drucker, Peter (July 1989). 'What Business Can Learn from Nonprofits'. Harvard Business Review. Retrieved 12 March 2012.
^Drucker, Peter (23 May 1983). 'Schumpeter And Keynes'. Forbes. Retrieved 12 March 2012.
^Drucker, P.F., Innovation and Entrepreneurship, p250 (1985)
^Farrell. C.J. 'Commercial Knowledge on Innovation Economics', A Report, (2014) pp. 1-11
^Drucker, P. F., Collins, J., Kotler, P., Kouzes, J., Rodin, J., Rangan, V. K., et al., The Five Most Important Questions You Will Ever Ask About your Organization, p. xix (2008)
^Drucker, Peter (1969). The Age of Discontinuity. New York: Harper & Row. ISBN978-1-56000-618-3.
^Pollitt and Bouckaert, Christopher and Geert (2011). Public Management Reform. New York: Oxford University Press. p. 38. ISBN978-0-19-959508-2.
^Drucker, Peter (1974). Management: Tasks, Responsibilities, Practices. New York: HarperCollins. pp. 84–5. ISBN978-0-7506-4389-4.
^Drucker, Peter (1942). The Future of Industrial Man. New York: The John Day Company. p. 205. ISBN978-1-56000-623-7.
^Drucker, Peter (1990). Managing the Non-Profit Organization. New York: HarperCollins. p. xii. ISBN978-0-7506-2691-0.
^Drucker, Peter F., The Practice of Management, pp 62-63, (1954)
^Drucker, Peter F., Managing for the Future, p. 299, (1992)
^Drucker, Peter F., The Practice of Management, p. 12, (1954)
^Drucker, Peter F., The Practice of Management (1954)
^Drucker, Peter F., The Five Most Important Questions You Will Ever Ask About Your Organization, p. 54, (2008)
^Haus, Marian (9 October 2011). 'Best 10 Peter Drucker Quotes'. pmseed thoughts on managing project work. pmseed. Retrieved 27 April 2015.
^Vitasek, Kate (1 June 2010). 'A New way to Outsource'. Forbes.
^Drucker, Peter (15 November 2005). 'Sell the Mailroom'. Wall Street Journal. Dow Jones Company (Manager's Journal). Retrieved 27 April 2015Reprint from July 25, 1989
^'Peter Drucker, Leading Management Guru, Dies at 95,' Bloomberg, 11 November 2005.
^Krueger, Dale. Strategic Management and Management by Objectives, Small Business Advancement National Center, 1994.
^Drucker, Peter. Introduction, pp. v–vi, in Sloan, Alfred P. (1964), McDonald, John, ed., My Years with General Motors, Garden City, New York: Doubleday, LCCN64-11306, OCLC802024. ISBN978-0385042352
^Presidential Medal of Freedom ceremony, 2002-07-09, The Drucker Institute Archives, Claremont, California.
^Great Silver Award, Box 8, Folder 7, The Drucker Institute and Archives, Claremont, California.
^'Reply to a parliamentary question'(pdf) (in German). p. 398. Retrieved 20 January 2013.
^'Reply to a parliamentary question'(pdf) (in German). p. 905. Retrieved 20 January 2013.
^'Reply to a parliamentary question'(pdf) (in German). p. 1305. Retrieved 20 January 2013.
^Japanese Decoration of Honor, Box 8, Folder 7, The Drucker Institute Archives, Claremont, California.
^Drucker, Peter. Biographical data, Box 35, Folder 30, The Drucker Institute Archive, Claremont, California.
^Letter recognizing Presidential Citation of New York University, Box 8, Folder 7, The Drucker Institute Archives, Claremont, California.
^McKinsey Award Winners at Harvard Business Review
^'Peter F. Drucker'. U.S. Business Hall of Fame. Junior Achievement. Archived from the original on 19 June 2010. Retrieved 17 December 2012.
^Honorary Degrees in The Drucker Institute Archives, Claremont, California.
^Bedeian, Arthur G.; Wren, Daniel A. (Winter 2001). 'Most Influential Management Books of the 20th Century'(PDF). Organizational Dynamics. 29 (3): 221–25. doi:10.1016/S0090-2616(01)00022-5.
^Wassenaar, Christina (8 October 2009). 'Eleventh Street in Claremont, Calif., will be renamed 'Drucker Way''. Drucker Institute. Retrieved 17 December 2012.
^Wartzman, Rick (February 2010). 'Insourcing and Outsourcing: the Right Mix'. Bloomberg Business. Bloomberg Business.com. Retrieved 27 April 2015.
^'2018 Hall of Fame Inductees'. thinkers50.com. Retrieved November 30, 2018.

External links[edit]

Drucker Archives in the Claremont Colleges Digital Library
The Window in the Claremont Colleges Digital Library
Sell the Mailroom – 1989 article by Drucker
Appearances on C-SPAN

Retrieved from 'https://en.wikipedia.org/w/index.php?title=Peter_Drucker&oldid=917370144'

Peter Drucker Management Theory Summary

This article explains the theory of Management By Objectives (MBO), developed by Peter Drucker in a practical way. After reading you will understand the basics of this powerful strategic management tool.

What is Management By Objectives?

Management By Objectives (MBO) is an performance management approach in which a balance is sought between the objectives of employees and the objectives of an organization. The essence of Peter Drucker ’s basic principle: Management By Objectives is to determine joint objectives and to provide feedback on the results. Setting challenging but attainable objectives promotes motivation and empowerment of employees. By increasing commitment, managers are given the opportunity to focus on new ideas and innovation that contribute to the development and objectives of organizations.

However, Peter Drucker sets a number of conditions that must be met:

Objectives are determined with the employees;
Objectives are formulated at both quantitative and qualitative levels;
Objectives must be challenging and motivating;
Daily feedback on the state of affairs at the level of coaching and development instead of static management reports;
Rewards (recognition, appreciation and/or performance-related pay) for achieving the intended objectives is a requirement;
The basic principle is growth and development not punishments.

Management By Objectives (MBO) is also known as Management By Results (MBR).

Management By Objectives steps

Peter Drucker has developed five steps to put Management By Objectives into practice:

1. Determine or revise the organizational objectives

Strategic organizational objectives are the starting points of management by objectives. These objectives stem from the mission and vision of an organization. If an organization has not formulated these yet, it does not make sense to carry out the next steps.

2. Translating the organizational objectives to employees

In order to make organizational objectives organization-wide, it is important that these are translated to employee level. For efficiency reasons, Peter Drucker used the SMART Goals acronym SMART (Specific, Measurable, Acceptable, Realistic and Time-bound). The element Acceptable is crucial in management by objectives as this is about agreement on the objectives between the employees and the organization. The management by objectives principle does not allow management to determine the objectives by themselves. According to management by objectives, objectives should be clearly recognizable at all levels and everyone should know what their responsibilities are in this. Communication is also an important item for consideration when it comes to expectations, feedback and to giving rewards for objectives that have been achieved.

3. Stimulate the participation of employees in the determining of the objectives

The starting point is to have each employee participate in the determining of personal objectives that are in line with the objectives of the organization. This works best when the objectives of the organization are discussed and shared throughout all levels of the organization so that everyone will understand why certain things are expected of them. In this way, everyone can make their own translation of what their contribution can be to the objectives. This approach increases the involvement and commitment of the objectives. Instead of simply following expectations of managers and executives, everyone in an management by objectives approach will know what is expected of them. By broadening the decision making process and responsibility throughout the organization, people are motivated to solve the problems they are faced with in an intelligent manner and they are given the information they need so that they can be flexible in the changing circumstances. This participatory process ensures that personal objectives with respect to general team objectives, department objectives, business unit objectives and ultimately organizational objectives are made clear.

4. Monitoring of progress

Because the goals and objectives are SMART, they are measurable. If they cannot be measured, a system will have to be set up in which a monitoring function is activated when the objectives are deviated from. Detection must be timely so that large problems can be prevented. On the other hand, it is important that the agreed objectives do not cause abnormal behaviour of employees for example. For instance, when a service call must be handled within seven minutes and as a result employees finish these calls after 6 minutes and 59 seconds to meet this requirement. There are always exceptions to a rule and these situations should always be supervised.

In Management By Objectives, employees are not supported by their management through annual performance reviews. Management By Objectives is about growth and development. Each objective comprises mini objectives and it is about supporting these in small steps in the form of coaching by managers or executives. Create a clear path with sufficient evaluation moments so that growth and development can be monitored accurately.

5. Evaluate and reward achievements

Management By Objectives has been designed to improve performance at all levels within an organization. A comprehensive evaluation system is therefore essential. As goals and objectives have been SMART formulated, they make the evaluation of processes very easy. Employees are evaluated and rewarded for their achievements in relation to the set goals and objectives. This also includes accurate feedback. Management By Objectives is about about why, when and how objectives can be achieved.

It is not a one-off exercise

Peter Drucker’s five steps are not a one-off exercise. It is a development cycle that takes the organizational objectives as the starting point and these need to be translated to an individual level. The message behind Management By Objectives is the jointly determining and achieving of objectives and being rewarded for these achievements. It is important to make fair and correct assessments of the achievements against the setting of measurable goals. Clear performance indicators are essential for a good management by objectives approach.

It’s Your Turn

What do you think? Do you recognize the practical explanation about Management By Objectives or do you have more suggestions? What are your success factors for the organizational goal setting and achieving business success?

Share your experience and knowledge in the comments box below.

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