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Peter Drucker On Leadership

Copied from Forbes with some format editing and notes added.

Rich Karlgaard, 11.19.04, 6:00 AM ET


Peter F. Drucker was born 95 years ago today — can it be possible? — in Vienna.

The universally known writer, thinker and lecturer now is nearly deaf and doesn’t get around like he used to.

He stopped giving media interviews about a year ago.

But in late October, Drucker granted an exception to at the urging of Dr. Rick Warren, the founder and head of the Christian evangelical Saddleback Community Church in Lake Forest, Calif.

The Drucker-Warren relationship may surprise many readers, but it goes back two decades, to when the young minister came to Drucker for advice.

Under Drucker’s tutelage, Warren’s own success as a spiritual entrepreneur has been considerable.

Saddleback has grown to 15,000 members and has helped start another 60 churches throughout the world.

Warren’s 2001 book, The Purpose-Driven Life, is this decade’s best seller with 19.5 million copies sold so far and compiling at the rate of 500,000 per month.

Warren and I met at Drucker’s surprisingly spartan home in Claremont, Calif., on a cloudy Tuesday morning.

We were greeted by Drucker’s wife, Doris, and ushered into the den for what developed into a two-hour conversation.

During the first 30 minutes, Drucker — a religious man himself, albeit of a more muted Episcopalian type as compared to Warren’s exuberant brand of Southern Baptist — advised Warren on the challenges of ministry and church building.

This consultation is one Drucker and Warren have engaged in twice yearly for two decades.

For the last 90 minutes we moved to broader topics.

Below are (some of ) Drucker’s thoughts on leadership.

(Drucker’s official biography.)

What Needs to Be Done

Successful leaders don’t start out asking, “What do I want to do?”

They ask, “What needs to be done?”

Then they ask, “Of those things that would make a difference, which are right for me?”

They don’t tackle things they aren’t good at.

They make sure other necessities get done, but not by them.

Successful leaders make sure that they succeed! They are not afraid of strength in others.

Andrew Carnegie wanted to put on his gravestone, “Here lies a man who knew how to put into his service more able men than he was himself.” (calendarize this?)

See the secret office

The Effective Executive

Check Your Performance

Effective leaders check their performance.

They write down, “What do I hope to achieve if I take on this assignment?”

They put away their goals for six months and then come back and check their performance against goals.

This way, they find out what they do well and what they do poorly.

They also find out whether they picked the truly important things to do.

I’ve seen a great many people who are exceedingly good at execution, but exceedingly poor at picking the important things.

They are magnificent at getting the unimportant things done.

They have an impressive record of achievement on trivial matters.

(calendarize this?)

Mission Driven

Leaders communicate in the sense that people around them know what they are trying to do.

They are purpose driven — yes, mission driven.

They know how to establish a mission.

bbx Drucker on Asia - A Dialogue Between Peter Drucker and Isao Nakauchi,

bbx The Five Most Important Questions and

bbx Managing the Non-Profit Organization

And another thing, they know how to say no.

The pressure on leaders to do 984 different things is unbearable, so the effective ones learn how to say no and stick with it.

They don’t suffocate themselves as a result.

Too many leaders try to do a little bit of 25 things and get nothing done.

They are very popular because they always say yes.

But they get nothing done. (calendarize this?)

He’s not talking about verbose mission statements that reside on a bookshelf.

A mission is a relevant end that is clear and highly focused.

It should be usable as a foundation for defining strategies, objectives, priorities, and work assignments.

See Business Performance section in
Management, Revised Edition, and
Management: Tasks, Responsibilities, Practices

Creative Abandonment

A critical question for leaders is, “When do you stop pouring resources into things that have achieved their purpose?”

The most dangerous traps for a leader are those near-successes where everybody says that if you just give it another big push it will go over the top.

One tries it once.

One tries it twice.

One tries it a third time.

But, by then it should be obvious this will be very hard to do.

So, I always advise my friend Rick Warren, “Don’t tell me what you’re doing, Rick.

Tell me what you stopped doing.” (calendarize this?)

The failed strategy

The Rise of the Modern Multinational

The modern multinational corporation was invented in 1859.

Siemens invented it because the English Siemens company had grown faster than the German parent.

Before the Second World War, IBM was a small maker, not of computers, but of adding machines.

They had one branch in England, which was very typical for the era.

In the 1920s, General Motors bought a German and English and then Australian automobile manufacturer.

The first time somebody from Detroit actually visited the European subsidiaries was in 1950.

A trip to Europe was a big trip.

You were gone three months.

I still remember the excitement when the then head of GM went to Europe in the 1920s to buy the European properties.

He never went back. (calendarize this?)

21st Century Organizations

Let me give you one example.

This happens to be a consulting firm headquartered in Boston.

Each morning, between 8 A.M. and 9 A.M. Boston time, which is 5 A.M. in the morning here in California and 11 P.M. in Tokyo, the firm conducts a one-hour management meeting on the Internet.

That would have been inconceivable a few years back when you couldn’t have done it physically.

And for a few years, I worked with this firm closely and I had rented a room in a nearby motel and put in a videoconferencing screen.

Once a week, I participated in this Internet meeting and we could do it quite easily, successfully.

As a result of which, that consulting firm is not organized around localities but around clients. (calendarize this?)

How To Lead a 21st Century Organization

Don’t travel so much.

Organize your travel.

It is important that you see people and that you are seen by people maybe once or twice a year.

Otherwise, don’t travel.

Make them come to see you.

Use technology — it is cheaper than traveling.

I don’t know anybody who can work while traveling.

Do you?

The second thing to say is make sure that your subsidiaries and foreign offices take up the responsibility to keep you informed.

So, ask them twice a year, “What activities do you need to report to me?”

Also ask them, “What about my activity and my plans do you need to know from me?”

The second question is just as important. (calendarize this?)

Prisoner of Your Own Organization

When you are the chief executive, you’re the prisoner of your organization.

The moment you’re in the office, everybody comes to you and wants something, and it is useless to lock the door.

They’ll break in.

So, you have to get outside the office.

But still, that isn’t traveling.

That’s being at home or having a secret office elsewhere.

When you’re alone, in your secret office, ask the question, “What needs to be done?” and here

Develop your priorities and don’t have more than two.

I don’t know anybody who can do three things at the same time and do them well.

Do one task at a time or two tasks at a time.

That’s it.

OK, two works better for most.

Most people need the change of pace.

But, when you are finished with two jobs or reach the point where it’s futile, make the list again.

Don’t go back to priority three.

At that point, it’s obsolete.

(calendarize this?)

How Organizations Fall Down

Make sure the people with whom you work understand your priorities.

Where organizations fall down is when they have to guess at what the boss is working at, and they invariably guess wrong.

So the CEO needs to say, “This is what I am focusing on.”

Then the CEO needs to ask of his associates, “What are you focusing on?”

Ask your associates, “You put this on top of your priority list — why?”

The reason may be the right one, but it may also be that this associate of yours is a salesman who persuades you that his priorities are correct when they are not.

So, make sure that you understand your associates’ priorities and make sure that after you have that conversation, you sit down and drop them a two-page note — “This is what I think we discussed.

This is what I think we decided.

This is what I think you committed yourself to within what time frame.”

Finally, ask them, “What do you expect from me as you seek to achieve your goals?”

(calendarize this?)

The Transition from Entrepreneur to Large Company CEO

Again, let’s start out discussing what not to do.

Don’t try to be somebody else.

By now you have your style.

This is how you get things done.

Don’t take on things you don’t believe in and that you yourself are not good at.

Learn to say no.

Effective leaders match the objective needs of their company with the subjective competencies.

As a result, they get an enormous amount of things done fast.

(calendarize this?)

How Capable Leaders Blow It

One of the ablest men I’ve worked with, and this is a long time back, was Germany’s last pre-World War II democratic chancellor, Dr. Heinrich Bruning.

He had an incredible ability to see the heart of a problem.

But he was very weak on financial matters.

He should have delegated but he wasted endless hours on budgets and performed poorly.

This was a terrible failing during a Depression and it led to Hitler.

Never try to be an expert if you are not.

Build on your strengths and find strong people to do the other necessary tasks.

(calendarize this?)

The Danger Of Charisma

You know, I was the first one to talk about leadership 50 years ago, but there is too much talk, too much emphasis on it today and not enough on effectiveness.

The only thing you can say about a leader is that a leader is somebody who has followers.

The most charismatic leaders of the last century were called Hitler, Stalin, Mao and Mussolini.

They were mis-leaders! Charismatic leadership by itself certainly is greatly overstated.

Look, one of the most effective American presidents of the last 100 years was Harry Truman.

He didn’t have an ounce of charisma.

Truman was as bland as a dead mackerel.

Everybody who worked for him worshiped him because he was absolutely trustworthy.

If Truman said no, it was no, and if he said yes, it was yes.

And he didn’t say no to one person and yes to the next one on the same issue.

The other effective president of the last 100 years was Ronald Reagan.

His great strength was not charisma, as is commonly thought, but that he knew exactly what he could do and what he could not do.

(calendarize this?)

How To Reinvigorate People

Within organizations there are people who, typically in their 40s, hit a midlife crisis when they realize that they won’t make it to the top or discover that they are not yet first-rate.

This happens to engineers and accountants and technicians.

The worst midlife crisis is that of physicians, as you know.

They all have a severe midlife crisis.

Basically, their work becomes awfully boring.

Just imagine seeing nothing for 30 years but people with a skin rash.

They have a midlife crisis, and that’s when they take to the bottle.

How do you save these people?

Give them a parallel challenge.

Without that, they’ll soon take to drinking or to sleeping around.

In a coeducational college, they sleep around and drink.

The two things are not incompatible, alas!

Encourage people facing a midlife crisis to apply their skills in the non-profit sector.

(calendarize this?)

Character Development

We have talked a lot about executive development.

We have been mostly talking about developing people’s strength and giving them experiences.

Character is not developed that way.

That is developed inside and not outside.

I think churches and synagogues and the 12-step recovery programs are the main development agents of character today.

(calendarize this?)





Purpose Driven source

Rich Karlgaard, 02.16.04, 12:00 AM ET

Most business books are big fat bores, except for those that are skinny bores — those trite little tomes involving whales and cheese and lessons learned from kindergarten.

Unless I know the author personally, I won’t read a business book.

If I do know the sucker, I like to drop the book on the pavement — in his presence — and back my car over it.

I spent too many years reading such piffle, underlining and highlighting “salient” points, taking notes and promptly forgetting everything I’d read within a week.

Lessons from business books never stick.

Much better learning tools are novels, history books and biographies.

For me, at least, these can really teach.


I suppose it’s because when your imagination is engaged, when you dig the lessons out yourself and connect them to your own life, the learning goes much deeper.

With that said, I give you the best book on entrepreneurship, business and investment that I’ve read in some time.

It’s not new and it’s not a business book.

It was written in 1995 and comes from the field of religion.

It’s titled The Purpose-Driven Church and was penned by Rick Warren.

Warren — in 1980 and from scratch — launched Saddleback Church in Orange County, Calif.

Under his leadership, the church has become the fastest-growing one in America.

(Saddleback is a Southern Baptist evangelical church, by the way.)

Weekends bring in an average of 15,000 worshippers.

Saddleback has spawned dozens of so-called daughter churches throughout the country.

Were it a business, Saddleback would be compared with Dell, Google or Starbucks.

The Purpose-Driven Church has sold more than 1 million copies.

Its sequel, The Purpose-Driven Life, has sold 12 million copies.

Whatever you think about Warren or his religious beliefs, he has discerned a consumer need out there.

So let’s engage our imaginations, substitute the word “business” for “church” and see what Warren has to tell us.

• Don’t try to make your business grow.

Instead, work to make your business healthy.

Because if it’s healthy, it will grow.

• Don’t be afraid to make it up as you go along.

Warren quotes Mark Twain, who once said: “I knew a man who grabbed a cat by the tail and learned 40% more about cats than the man who didn’t.”

A healthy business is one that tries many things that don’t work — and has the scratches and scars to prove it.

• Don’t trap yourself in costly infrastructure.

To accommodate Saddleback’s continual growth, Warren used 79 different facilities for functions in the church’s first 15 years — schools, bank buildings, recreation centers, theaters, restaurants, large homes, even a 2,300-seat tent.

Only in 1995, when the church had grown to 10,000 worshippers per weekend, did Warren erect Saddleback’s own building.

“The shoe must never tell the foot how big it can grow,” he says.

• Don’t compete for market share.

Instead, compete with nonconsumption.

“The church [business] must offer people something they cannot get anywhere else,” Warren says.

• Sell big!

“I’ve discovered that challenging people to a serious commitment actually attracts people rather than repels them,” says Warren.

“The greater commitment we ask for, the greater response we get.”

• Faith and dedication won’t overcome lack of skill and technology.

Funny words from a preacher, but how true.

“One of my favorite verses,” Warren says, “is Ecclesiastes 10:10: ‘If the ax is dull and its edge unsharpened, more strength is needed, but skill will bring success.’”

• Borrow from others’ successes.

“Anytime I see a program working in another church [business], I try to extract the principle behind it and apply it in our church.

I’m very grateful for the models that have helped me.

I learned a long time ago that I don’t have to originate everything for it to work.”

• Never enter a new business without first picking someone to lead it.

“If no leader emerged, we would wait on God’s timing before beginning a ministry,” says Warren.

• Purpose not only defines what your business should do, it defines what it shouldn’t do.

“The secret to effectiveness is to know what really counts.

Then do what really counts.”

• Nothing should precede the purpose of your business.

“Plans, programs and personalities don’t last,” says Warren.

Only purpose lasts.

It can heal your business, too.

“Nothing will revive a discouraged church [business] faster than rediscovering its purpose.”

The Lesson of Dell

A couple of weeks ago I interviewed Michael Dell at an investment banking conference.

As terrific as Dell Inc.’s success has been, some think the company’s announced goal of $60 billion in sales (now $40 billion) by 2006 is, well, too audacious.

To hit its mark, Dell must succeed across a range of new businesses — plasma TVs, printers, MP3 players, high-end servers, even consulting services.

Many battles on many fronts — thus the skepticism.

But when I look at Michael Dell, I see a guy who told me in 1992--at age 26--that he was going to become the IBM of the 21st century.

(Talk about inviting skepticism!)

In Dell I see a company that, despite its size, retains its clear purpose.

Carly Fiorina of Hewlett-Packard, a top-class CEO herself, inadvertently got Michael Dell to reveal his purpose when she accused Dell Inc. of being a one-trick pony.

“No,” Dell shot back.

“We’re a two-trick pony.

We satisfy customers and we make a profit.”

Such clarity will propel Dell Inc. to $60 billion by 2006.




Peter Drucker: Conceptual Resources

The Über Mentor

A political / social ecologist
a different way of seeing and thinking about
the big picture
— lead to his top-of-the-food-chain reputation

drucker business week

about Management (a shock to the system)


“I am not a ‘theoretician’; through my consulting practice I am in daily touch with the concrete opportunities and problems of a fairly large number of institutions, foremost among them businesses but also hospitals, government agencies and public-service institutions such as museums and universities.

And I am working with such institutions on several continents: North America, including Canada and Mexico; Latin America; Europe; Japan and South East Asia.” — PFD




List of his books


Large combined outline of Drucker’s books — useful for topic searching.




High tech is living in the nineteenth century,
the pre-management world.
They believe that people pay for technology.
They have a romance with technology.
But people don't pay for technology:
they pay for what they get out of technology.” —
The Frontiers of Management


“The greatest danger in times of turbulence is not turbulence; it is to act with yesterday’s logic”. — Peter Drucker

The shift from manual workers who do as they are being told — either by the task or by the boss — to knowledge workers who have to manage themselves ↓ profoundly challenges social structure

Managing Oneself is a REVOLUTION in human affairs.” … “It also requires an almost 180-degree change in the knowledge workers’ thoughts and actions from what most of us—even of the younger generation—still take for granted as the way to think and the way to act.” …

… “Managing Oneself is based on the very opposite realities: Workers are likely to outlive organizations (and therefore, employers can’t be depended on for designing your life), and the knowledge worker has mobility.” ← in a context




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