Peter F Drucker

Born
Died
Alma mater
Occupation

November 19, 1909, Vienna, Austria-Hungary

November 11, 2005 (aged 95)
University of Frankfurt
Management Consultant, Educator and Author

Brief about Peter F Drucker

Peter Ferdinand Drucker 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 (MBO)
He has been described as "The Founder of Modern Management
His writings have predicted many of the major developments of the
late twentieth century, including privatization and decentralization

Drucker's writings

Drucker's 39 books have been translated into more than thirty-six

languages.
He also penned a regular column in the Wall Street Journal for 10 years
Contributed frequently to the Harvard Business Review, The Atlantic
Monthly, and The Economist

Key Ideas

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 concept of "knowledge worker" in his 1959 book "The Landmarks
of Tomorrow". Since then, knowledge-based work has become
increasingly important in businesses worldwide.
The concept of what eventually came to be known as "outsourcing." 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 non-profit sector, 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, Drucker contended
that economists of all schools fail to explain significant aspects of
modern economies.
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.

Major contributions of Peter Drucker are as follows

1. Nature of Management
Drucker is against bureaucratic management and has emphasised
management with creative and innovative characteristics. The basic
objective of management is to read towards innovation. The concept of
innovation is quite broad. It may include development of new ideas,
combining of old and new ideas, adaptation of ideas from other fields or even
to act as a catalyst and encouraging others to carry out innovation. He has
treated management as a discipline as well as profession. As a discipline,
management has its own tools, skills, techniques and approaches. However,
management is more a practice rather than a science. Thus, Drucker may be
placed in empirical school of management.
2. Management Functions:
According to Drucker, management is the organ of its institution. It has no
functions in itself, and no existence in itself. He sees management through
its tasks. Accordingly, there are three basic functions of a manager which he
must perform to enable the institution to make its contribution for:
The specific purpose and mission of the institution whether business,
hospital or university;
Making work productive and the worker achieving; and
Managing social impacts and social responsibilities.
All these three functions are performed simultaneously within the same
managerial action.
3. Organization Structure:

Drucker has decried bureaucratic structure because of its too many

dysfunctional effects. Therefore, it should be replaced. He has emphasised
three basic characteristics of an effective organization structure. These are:
Enterprise should be organised for performance;
It should contain the least possible number of managerial levels
It must make possible the training and testing of tomorrows top
managersresponsibility to a manager while still he is young.
4. Federalism:
Drucker has advocated the concept of federalism. Federalism refers to
centralised control in decentralised structure Decentralised structure goes
far beyond the delegation of authority.
5. Management by Objectives:
Management by objectives (MBO) is regarded as one of the important
contributions of Drucker to the discipline of management. MBO includes
method of planning, setting standards, performance appraisal, and
motivation.
According to Drucker, MBO is not only a technique of management but it is a
philosophy of managing. It transforms the basic assumptions of managing
from exercising cattalo to self-control. Therefore, in order to practice MBO,
the organisation must change itself MBO has become such a popular way of
managing that today t is regarded as he most modern management
approach. In fact, it has revolutionalised the management process.
6. Organizational Changes:
Drucker has visualized rapid changes in the society because of rapid
technological development. Though he is not resistant to change, he feels
concerned for the rapid changes and their impact on human life. Normally,
some changes can be absorbed by the organization but not the rapid
changes.
Since rapid changes are occurring in the society, human beings should
develop philosophy to face the changes and take them as challenges for
making the society better. This can be done by developing dynamic
organizations which are able to absorb changes much faster than static ones.
Awards and Honors
Drucker was the Honorary Chairman of the Peter F. Drucker Foundation for
Nonprofit Management, now the Leader to Leader Institute, from 1990
through 2002.

Drucker was awarded the Presidential Medal of Freedom by US

President George W. Bush on July 9, 2002.
He also received honors from the governments of Austria, including the
Grand Silver Medal for Services to the Republic of Austria in 1974,
The Grand Gold Decoration for Services to the Republic of Austria in
1991
The Austrian Cross of Honour for Science and Art, 1st class in 1999 and
Japan
In 1969 he was awarded New York Universitys highest honor, its
Presidential Citation. 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.
Drucker was inducted into the Junior Achievement US Business Hall of
Fame in 1996.
He received 25 honorary doctorates from American, Belgian, Czech,
English, Spanish and Swiss universities.
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.

Drucker is perhaps the only Western Management thinker who has attracted
so much attention of the community world