Peter Drucker, theorist on management, dies

Preached to business that employees were a resource, not a cost

November 12, 2005|By NEW YORK TIMES NEWS SERVICE

Peter F. Drucker, the political economist and author whose view that big business and nonprofit enterprises were the defining innovation of the 20th century led him to pioneering social and management theories, died yesterday at his home in Claremont, Calif. He was 95.

Mr. Drucker thought of himself, first and foremost, as a writer and teacher, though he eventually settled on the term "social ecologist." He became internationally renowned for urging corporate leaders to agree with subordinates on objectives and goals and then get out of the way of decisions about how to achieve them.

He challenged both business and labor leaders to search for ways to give workers more control over their work environment. He also argued that governments should turn many functions over to private enterprise and for organizing in teams to exploit the rise of a technology-savvy class of "knowledge workers."

Mr. Drucker staunchly defended the need for businesses to be profitable, but he preached that employees were a resource, not a cost. His constant focus on the human impact of management decisions did not always appeal to executives, but they could not help but notice how it helped him foresee many major trends in business and politics.

He talked about such practices in the 1940s and '50s, decades before they became so widespread that they were taken for common sense. Drucker foresaw that inflation would rise in the 1970s, that Japanese manufacturers would become major competitors for the United States, and that union power would decline.

For all his insights, he clearly owed much of his impact to his extraordinary energy and skills as a communicator. But while Mr. Drucker loved dazzling audiences with his wit and wisdom, his goal was not to be known as an oracle.

Indeed, after writing a rosy article shortly before the stock market crash of 1929 in which he outlined why stock prices would rise, he pledged to himself to stay away from gratuitous predictions. Instead, his views about where the world was headed generally arose out of advocacy for what he saw as moral action.

His first book, The End of Economic Man, 1939, was intended to strengthen the will of the free world to fight fascism. His later economic and social predictions were intended to encourage businesses and social groups to organize in ways that he felt would promote human dignity and vaccinate society against political and economic chaos.

"He is remarkable for his social imagination, not his futurism," said Jack Beatty in a 1998 review of Mr. Drucker's work, The World According to Peter Drucker.

Mr. Drucker, who was born in Vienna, Austria, worked in Germany as a reporter until Adolf Hitler rose to power and then in a London investment firm before immigrating to the United States in 1937. He became an American citizen in 1943.

Recalling the disasters that overran the Europe of his youth and watching the American response left him convinced that good managers were the true heroes of the century. The world, especially the developed world, had recovered from repeated catastrophe because "ordinary people, people running the everyday concerns of business and institutions, took responsibility and kept on building for tomorrow while around them the world came crashing down," he wrote in 1986 in The Frontiers of Management.

Mr. Drucker never hesitated to make suggestions he knew would be viewed as radical. He advocated legalization of drugs and stimulating innovation by permitting new ventures to charge the government for the cost of regulations and paperwork.

He was not surprised that General Motors for years ignored nearly every recommendation in The Concept of the Corporation, the book he published in 1946 after an 18-month study of GM that its executives had commissioned.

From his early 20s to his death, Mr. Drucker held various teaching posts, including a 20-year stint at New York University's Stern School of Management and, since 1971, a chair at the Claremont Graduate School of Management.

He also consulted widely, devoting several days a month to such work into his 90s. His clients included major businesses but also the Archdiocese of New York and several Protestant churches, government agencies in the United States, Canada and Japan, universities and entrepreneurs.

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