Peter Drucker's Way to the Top

by William Cohen

  Drucker was a genius who became known as the father of modern management. But was Drucker always interested in management or social ecology? Early in his career Drucker wanted to be a professor. But he studied for a PhD in law because, according to him, in Germany it was the easiest to get at the time. If his real interest in management was always so great, why were his early books and teaching in other disciplines? Drucker acquired his intense interest in management only after some success and his work with General Motors. Opportunity knocked, demonstrated its wants and needs and Drucker recognized this demand. Further, he was ready: he had the tools, interest, and wisdom to answer. According to Drucker, that is about the best we can do, since we usually do not know our real interest at an early age, sometimes not until much older. Moreover, interests change. About the best that we can do is to have the necessary tools and wisdom ready when a new interest arises. So, Drucker, while still a young man in his thirties, could hit the ground running and take advantage of a brand-new career in management which would eventually morph into a career as a social ecologist.

  SOCIAL RESPONSIBILITIES

  In recognition of social responsibilities, many companies have modified their approach to include a social emphasis. For example, R. Gordon McGovern, at the time president of Campbell Soup Company, stated that the goal for Campbell was, “To be positioned with consumers as somebody who is looking after their well-being.”8

  The clear implication here is that firms with a social emphasis do not seek profit as their only purpose. Instead, profits are viewed as a business requirement in order as Drucker determined, to create a customer.

  Of course, without profit, business stops. Drucker discovered that the purpose of a business was to create a customer, for without a customer there can be no business. To succeed, a business must produce goods and services that a sufficient number of customers will want to buy at adequate prices. Since production wears out the machinery that produces the product and is necessary to financially support the employees who run and manage the machines, to keep the business going there’s got to be enough left over to replace what’s being worn out. That ‘enough’ is profit, no matter what the accountants, the tax authorities, or anyone calls it. That is why profit is a requisite, not a purpose, of business.

  If we translate this into a person striving to reach the top in any profession we run into the same issue. There are necessities like food and shelter for ourselves and our families that we need to keep going. But the purpose of our success must be to ‘create a customer’ that is, to contribute to society by producing value. Call it a positive unit of something.

  If this be social ethics, Drucker simplified it for those striving to reach the top. He suggested a straightforward method that he called the mirror test. When you look in the mirror every morning, who do you want to see looking back at you? He told us once that procuring prostitutes for visiting executives didn’t make you unethical. It merely made you a pimp. Is a pimp what you want to see in the mirror?

  Drucker figured this out early along the path and lived his life not to acquire, but to contribute and to maintain a value system that he could support at the same time.

  1. Drucker, Peter F. Innovation and Entrepreneurship (New York: Harper & Row, 1985), 220.

  2. “Baseball Reference: Progressive Leaders & Records for Batting Average”. Sports-Reference.com, https://bit.ly/2vMxR5r, accessed 21 July 2018.

  3. Kim, W. Chan and Renée Mauborgne. Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant (Cambridge, MA: Harvard Business School, 2005).

  4. Drucker, Peter F. Management Challenges for the 21st Century (New York: Harper Business, 1999), 2

  5. Kotler, Philip, quoted in in Mike Thimmesch. “What Is Marketing? How 10 Experts Define It”. Skyline® Tradeshow Tips, August 8, 2010, https://bit.ly/2vNbAEI.

  6. Levitt, Theodore. “Marketing Myopia”. Harvard Business Review (July-August 1960), 45-56. https://bit.ly/1xtBSn8.

  7. Drucker, Peter F. Management: Tasks, Responsibilities, Practices (New York: Harper & Row, 1974), 64.

  8. “Marketing: The New Priority”. Business Week, 21 November 1983, 96-106, 103.

  CHAPTER 17

  HOW DRUCKER INFLUENCED OTHERS

  To be effective you have to know the strengths, the performance modes, and the values of your co-workers.

  – Peter F. Drucker

  To be successful you must lead and practise the eight universal laws of success as described in Chapters 4 to 12. Knowing and practising these laws are especially needed. In most cases people, no matter how capable or talented, don’t achieve success alone. Others help. In addition, you must know how to lead others for positive results whether you are their supervisor or not. Leading and influencing for positive results means learning how others prefer to be treated and as much as possible treating them as they prefer even in moving towards your own goals and objectives. To do this you must influence others on an individual basis and if you work with groups you must consider how to influence the group for positive results. This chapter discusses eight strategies of influencing others depending on the situation, relative power you hold or do not hold in the situation, and what you are trying to accomplish. As we will see, that’s what Drucker did throughout his career.

  DRUCKER, A MAN OF APPLICATION, NOT THEORY

  Drucker was a man of application and not just a theorist. He knew that to accomplish anything you had to work with others and that the others were human beings who are always different in their likes and dislikes as well as their preferences. What this means is that to influence them positively, you need to know how each wants to be treated. You may think that there is only one correct way of doing anything, and that is wrong. There are many. As Drucker noted, others have the perversity to behave as human beings.1 There are frequently many ‘best’ ways depending on the situation and the individual or individuals you are dealing with. Each of us prefers a different way and feels that our own is best. Motivational speaker Tony Robbins had one explanation for this which Drucker would probably have agreed with. We were each raised differently and given different rules within our family, which we are taught is the way that things must be done.

  One person is taught that he must never participate in adult conversations, ‘a child should be seen, but not heard’. In another family, a child is encouraged to speak out whenever adults converse. As the child grows up these differing rules may result in differing approaches in dealing with others. Growing up with rules like these carry over into other relationships we have later in both our personal and professional lives.

  THE TALE OF THE TWO COMPETING VICE PRESIDENTS

  The story of the two competing vice presidents was a management problem based on an actual occurrence that Drucker asked his students to solve. The situation was that as the president of a company grew older he made the decision to retire in five years’ time. The president had two outstanding vice presidents who had about equal experience and were both equally competent in their performance although each had his own way of getting things done. The president called each into his office and explained that each was a candidate to replace him when he retired, and that the decision would be based on their performance over this five-year time frame.

  Over the next five years both worked diligently, and both did outstanding work in performance of their duties. However, the way in which each performed was quite different. One vice president felt that he should not bother the president. He worked every challenge given to him in on his own and he performed brilliantly. He went to query the president only when he had a particular challenging problem which he was having difficulty in solving. After he completed the project, he gave the president a briefing on why he had made the decisions that he had made.

  The other vice president performed brilliantly also but operated quite differently. He discussed all issues with the president before he made a decision. He briefed the president weekly on these problems and on the
ir status.

  Drucker asked us which vice president became the new president after five years. Most of us thought that it was the vice president that showed he could work on his own, independently, while keeping the president informed as to how things had gone. Much to our surprise Drucker told us that it was the other vice president, the one who discussed every issue with the retiring president. The answer surprised most of us but Drucker explained that it was the one that kept the president involved. This president desired this.

  Drucker’s reasoning on this outcome was that this particular president wanted to be involved and to understand everything that was happening within his company. Drucker’s point was that either answer could have been correct, but that with this particular president since he preferred, above all else, to be kept informed during any work that was done it was important for the subordinates to understand and do this. This is why the outgoing president made certain that the board would appoint a replacement much like himself. People are different in this way.

  THE STORY OF THE THREE GERMAN COLONELS

  During World War I, a captain in the German Army described a classical example of the use of different influence tactics by a brigade commander and how he influenced his three colonels before an important operation.

  The first regimental colonel wanted to do everything himself, and always did well. His second colonel executed every order, and performed well, but usually demonstrated little initiative on his own. He had to be told the smallest detail of what was expected. Finally, there was the colonel commanding the third regiment. He opposed almost everything he was told and was outspoken about wanting to do the contrary.

  In battle, the brigade came up against a heavily defended allied position that had to be captured. The brigade commander issued different orders to influence each regimental commander for the same operation.

  To his first colonel he said: “My dear Colonel ‘A’. We will attack. Your regiment will have to carry the burden of the attack. I have, however, selected you for this very reason. The second regiment will be your boundary on the left. The third regiment will be your boundary on the right. Attack at 1200 hours. I don’t need to tell you anything more as I have full confidence that you will use your own initiative in carrying out my orders to capture this position. Do you have any questions?” On answering the few points that his first colonel asked, he left and went to his third colonel, C, who generally opposed everything.

  To him the brigade commander spoke quite differently. “We have met a very strong enemy position which we have been told to capture. I am afraid however that we will not be able to attack successfully with the forces at our disposal.”

  As he thought, his third colonel didn’t agree.

  “Oh, General, certainly we will attack and capture it. Just give my regiment the time of attack and you will see that we will be successful.”

  “Oh, very well. Go, then, we will try it,” said the brigade commander and he gave his third colonel the formal order for the attack that he had prepared previously and again as with his first colonel, he answered any questions and then departed.

  As for the colonel commanding his second regiment, he simply sent the attack order with many more details than he had given his other commanders.

  All three regiments attacked successfully.2

  In this chapter, you will learn the primary influence tactics and when and how to use them in practice over a wide variety of situations. Drucker applied these to influence his superiors, his associates, his clients, and his students. Your proper use of these tactics will equip you with the arsenal to make you a powerful influencer recognizing, as Drucker maintained, that these are human beings and must be treated differently.

  HOW OTHERS PREFER TO COMMUNICATE

  But before we start, you should first recognize, as Drucker did, that different people prefer to receive knowledge and communicate in two ways: verbally or in writing. To be effective in dealing with others, you need to know which method they prefer. In a lesson Drucker taught on influencing your boss, he stated that it was extremely important to find out which method of communication that your boss prefers. Later he wrote:

  “Typical are people who, in their first assignment, work for a man who is a reader. They therefore were trained in writing reports. Their next boss is a listener. But these people keep on writing reports to the new boss – the way President Johnson’s assistants kept on writing reports to him because Jack Kennedy, who had hired them, had been a reader. Invariably, these people have no results. Invariably, their new boss thinks they are stupid, incompetent, lazy. They become failures. All that would have been needed to avoid this would have been one look at the boss and ask a question: ‘How does he or she perform?’”3

  In fact, all people prefer to receive knowledge and communicate in these two ways. It is important to know which. You can find out which by asking or by observation. But how you influence them, and others means that you depend on other things including the situation and the power you have in the situation.

  1. THE INFLUENCE STRATEGY OF DIRECTION

  There are three situations where simply giving orders with no discussion is your best choice. But first, to employ the direction strategy, you must have more power in the situation than those you intend to influence. If you try to influence your boss this way, not only will you probably fail, but you may damage the relationship permanently.

  The first situation where you may want to use direction is where there is little time. What you need done needs to be done now, with no time for discussion. For example, there is no time for dilly-dallying when stakes are high or when a slight delay can result in a significant negative impact.

  The second situation when you should use direction is when the action you want done may be good for the organization but is less desirable for the individual. You need a report written by tomorrow morning, but the person who must do this has their own plans that conflict with getting the report finished on time. While you can try to use the other influence strategies first, eventually it may come down to using direction.

  Unfortunately, the direction strategy is much overused. One reason is that when you have power it’s so easy to use it and have things done your way. All you do is tell someone what to do and they do it. And that’s the danger of overuse. As President Eisenhower commented about overuse of direct orders: “You do not lead by hitting people over the head – that’s assault, not leadership.”4 It’s a holding a gun to the head style of influence. It works. At times it is necessary, but overused, it is counterproductive.

  When is direction right? Drucker said that a certain decision should be taken even when there are many reasons why it should not be done, but one right reason why it should. And that leads to the third situation, something is right, or at least you believe it is, but you are the only one that can correct it, and others may fear the consequences if you make this decision and force others to accept your position.

  Late in 2017, President Trump announced the decision to move the American embassy to Jerusalem as the capital of Israel. Most of his senior advisors in government recommended against it. So did the Pope and many other foreign leaders. Some Arab and Palestinian groups threatened terror and “days of rage”.5 Trump pointed out that every country in the world had the right to declare its own capital, and despite this, for 70 years Israel’s capital as Jerusalem had not been recognized by the US or other countries. They said that the decision was controversial because it needed to be negotiated. “This,” he said, “is wrong.”

  Already, in 1995 a US law had been passed recognizing Jerusalem as Israel’s capital, but the law was ignored and each US president, both Democrat and Republican, gave himself a waiver.

  Trump’s decision recalls President Truman’s recognition of Israel’s very existence as a country in 1948. President Truman’s own Secretary of State then, General George C. Marshall threatened to resign if President Truman recognized Israel as an independent country. Arab countries
threatened to invade the territory that was to become Israel and destroy it if Truman gave Israel this recognition. Truman ignored both threats. He recognized Israel anyway.

  Secretary of State Marshall reconsidered and did not resign. However, seven Arab countries did invade the new State of Israel but were unsuccessful in destroying it, which may be just as well for them and for the rest of us, too. From voicemail technology, to the mobile (cell) phone, and the first fully computerized, no-radiation, diagnostic instrumentation for breast cancer, and other scientific breakthroughs and more, all were developed in Israel.6

  Regarding his announcement, Trump clearly recognized the credible threats made, but felt that the correctness of the decision outweighed the consequences. Rather than any other influence strategy, which he correctly said hadn’t worked in bringing peace between the Arabs and Israelis over the preceding 70 years, Trump chose direction.

  The point is not whether you favour Israel or its adversaries or if Israel should have been recognized, or the American embassy moved, but rather if you believe something to be right that overrides possible negative consequences, and you have the responsibility for making the decision, then it is wiser to make the decision you believe correct even if others disagree.