Consulting Drucker Read online

  Advance Praise

  “Cohen’s book not only captures the essential parts of Peter Drucker’s management principles, he offers tangible advice on how to effectively use them as a management consultant. This is a thorough and well-researched book from a man who worked so closely with Drucker that it reads as if Drucker wrote this himself. This is sure to become the go to book for anyone interested in business consulting.”

  F. Lee Reynolds, Senior Manager - Studio Tour, Universal Studios, Hollywood

  “Peter Drucker is gone. Fortunately his student, Bill Cohen, carries on Drucker’s work. Consulting Drucker is not just good advice for those who are professional consultants. It reveals aspects of Drucker’s work that are rarely discussed and not closely analysed. How was Drucker able to be so successful as a consultant, working alone, in so many different environments? His consulting work included industries and many countries from governments and the military to even individual entrepreneurs and religious organizations. This book has the answers, answers that all managers need and can profit from.”

  Bill Bartmann, author of Bouncing Back and other books; President and Founder, CFS, CFS2, Inc. and Financial Samaritan.com, assisted 4.5 million debtor clients in rebuilding their lives.

  “Peter Drucker once explained his greatest strength as a consultant was to be ignorant and asked a few questions. It sounds simple but difficult to apply. Now you can learn and practice Drucker’s legendary consulting methodology through Consulting Drucker written by Dr. Cohen, the first and favorite PhD graduate of Drucker. His first hand observation from Drucker with simple but effective techniques is very fascinating and insightful. You just cannot miss this invaluable book.”

  Julia Wang, President, Peter F. Drucker Academy, Hong Kong

  “Business consultants come in three flavours. The first is familiar with Peter Drucker the author. The second loves Drucker, occasionally quoting him to clients. The third understands Drucker, applying his ideas multiple times a day. I have yet to meet a business consultant who has not heard of Peter Drucker. General Cohen, one of Professor Drucker’s first students and a veteran business consultant and business academic, here describes and explains Drucker’s early beginnings, his routines, and his lasting intellectual contributions. By reading this book, you’ll save countless hours deciphering his work, and your clients will benefit immediately.”

  Nevin Kamath, JD, former Director, The Consulting Institute, CIAM and former Senior Consultant, McKinsey & Company, President and Founder, Kamath & Company

  “I acquired an EMBA from Claremont Graduate School, Drucker School of Management where I had the privilege of experiencing Peter Ducker’s lectures and discussions first hand. I have known Bill Cohen for over three decades and had the privilege of professionally sharing his account of Peter Ducker’s management and leadership frameworks in the military, industrial and healthcare sectors. Dr. Cohen’s recent expanded account Consulting Drucker is insightful, astute and accurate.”

  Albert M. Randall, MD, Colonel, USAF, Ret. Board of Directors Corona Regional Medical Center

  Advance Praise

  From

  Previous Books

  From A Class with Drucker

  “A fresh look at the timeless wisdom of Peter Drucker. This riveting book reveals previously unpublished ideas that Drucker shared with his students and offers a glimpse into what it was like to know the man himself.”

  Edward T. Reilly, President and CEO, American Management Association

  “A Class with Drucker is more than a book – it is a great gift, bringing Peter Drucker and his classroom alive for all of us who never had the privilege of a class with Drucker . . . Bill Cohen’s journey with Drucker adds a new dimension to our understanding and appreciation and keeps the Drucker legacy vibrant and alive for future generations.”

  Frances Hesselbein, Chairman and Founding President, Leader to Leader Institute

  “Bill Cohen brings that laboratory of learning alive to those of us who didn’t have the pleasure, privilege or opportunity to sit at the feet of the master in Peter’s classroom. One can feel the energy, the humour, the discipline, the interaction, the edge, the energy, the simplicity and the relevance of Peter’s practice of teaching. This is a gift Bill has produced as a way of returning the favour and blessing of Peter’s friendship and caring for Bill over more 30 years.”

  Ira Jackson, Dean, Peter F. Drucker and Masatoshi Ito Graduate School of Management, Claremont Graduate University

  From Drucker on Leadership

  “Cohen has written with clarity and authority about the major challenges facing leaders today. And Cohen, like Drucker, emphasizes responsibility and integrity in leadership, qualities so desperately needed today. I strongly recommend this book to you.”

  Joseph A. Maciariello, Horton Professor of Management, Peter F. Drucker and Masatoshi Ito Graduate School of Management, and co-author of The Daily Drucker by Peter F. Drucker and Management by Peter F. Drucker

  “Cohen’s unique relationship with Peter Drucker, as student and friend, allows him to extract valuable leadership lessons from Drucker’s writings and teachings on management. Bill Cohen’s “labour of love” provides the essential lessons for leaders straight from the Father of Modern Management.”

  Ronald E. Riggio, Henry R. Kravis Professor of Leadership and Organizational Psychology, and director of the Kravis Leadership Institute at Claremont McKenna College

  “What Cohen learned as Peter Drucker’s student, and their personal relationship afterwards, changed Bill’s life. Reading Drucker on Leadership will change the way you look at and apply leadership forever.”

  Bruce Rosenstein, author of Living in More Than One World: How Peter Drucker’s Wisdom Can Inspire and Transform Your Life

  From Drucker on Marketing

  “Drucker said it best when he said that marketing and innovation are the most important business functions because they generate new customers. So, believe me, anything he said about marketing is worth reading. There’s no better thinker.”

  Jack Trout, President, Trout & Partners Ltd., and co-author of Positioning

  “Every successful organization must be about “creating and keeping customers.” This book is about the essence of marketing. It reflects Bill Cohen’s unique ability to understand and communicate Peter Drucker’s thoughts and ideas about this subject with the added touch of how to implement them in a dynamic and changing world.”

  C. William Pollard, Chairman Emeritus, The ServiceMaster Company

  “Perhaps the only real flaw in Peter Drucker’s work is that there is so incredibly much of it – some 10,000 book pages, plus countless articles from newspapers, magazines and scholarly journals. How can you possibly begin to pull out just what you’re looking for? Thankfully, we now have Drucker on Marketing in which Bill Cohen has synthesized and analysed and brought to life the single subject that, in many respects, lies at the heart of all of Drucker’s writing: how to create a customer. This is a major contribution.”

  Rick Wartzman, Executive Director, Drucker Institute and columnist for Forbes.com

  From The Stuff of Heroes:

  The Eight Universal Laws of Leadership

  “A first-class primer on the elusive subject of leadership.”

  General H. Norman Schwarzkopf

  “Cohen’s “Eight Universal Laws” are not presented in bloodless abstract, but are instead revealed through the examples of real people being tested.”

  Robert A. Lutz, Vice Chairman, Chrysler Corporation

  “Dr. Cohen absolutely knows his stuff. If you want to know how to lead any organization, read The Stuff of Heroes.”

  Barry Gordon, Past President, Screen Actors Guild

  From The Art of t
he Leader

  “Full of excellent examples and analogies – crisp and clear. Well done!”

  Frank Popoff, President and CEO, The Dow Chemical Company

  “The range of sources and examples is most impressive. Leadership skills can be taught and developed in those possess the nascent qualifications. Dr. Cohen’s book not only proves it, but contributes to the process.”

  John D. Ong, Chairman of the Board, The B.F. Goodrich Company

  “Easy reading, good logic, and a novel approach. It will deservedly attract a wide range of readers.”

  James Wood, Chairman and CEO,

  The Great Atlanta and Pacific Tea Company, Inc.

  From The Art of the Strategist

  “This book is a ‘must read’ for anyone responsible for leading an organization. It is so engrossing that it is almost impossible to put down, but more importantly it is a sure recipe for success. I am gifting a copy to the management of all of my portfolio companies.”

  Harvey Knell, CEO, KCM Management, Inc., former President and CEO, Grace Homes Centers West

  “Outstanding! An indispensable guide for strategists and decision makers. Master the ten principles in this book and you will master your competition.”

  Michael A. Mische, CEO, Synergy Industries, former Principal, KPMG Peat Marwick and author of Strategic Renewal

  “Everyone who reads this book will wish that they had done what it recommends a long time ago.”

  Ambassador Ronald F. Lehman, II, PhD, former Director of the U.S. Arms Control and Disarmament Agency and Assistant Secretary of Defense for International Security Policy

  CONSULTING

  DRUCKER

  PRINCIPLES AND LESSONS

  FROM THE WORLD'S LEADING

  MANAGEMENT CONSULTANT

  WILLIAM A. COHEN, PHD

  Dedication

  I’d like to dedicate this book to the following individuals:

  Dean Paul Albrecht who along with Peter Drucker developed the PhD Programme to which I am proud to have been the first graduate.

  Minglo Shao who had both the determination, ability, and generosity to found both the Peter Drucker Academy of China and the non-profit California Institute of Advanced Management (CIAM) and to serve as its chairman.

  My colleagues, administrators, professors, and board members at CIAM who through their courage and hard work have performed above and beyond the call of duty and succeeded under adversity in building a school teaching Drucker’s principles and while implementing new concepts and elements available nowhere else.

  CIAM’s students and graduates who by their success are proving the value of Peter Drucker’s concepts.

  Finally to two people who not only impacted on this book, but on its author:

  My wife, Dr Nurit Cohen, who through 48 years of wars, challenges, defeats, and victories on several continents has never wavered in her support.

  And of course, Peter Drucker himself who saw something in me during a time of great trial that I did not see in myself.

  Table of Contents

  Foreword by Dr Francisco Suárez Hernández

  Introduction by Philip Kotler

  Chapter 1

  The World’s Greatest Independent Consultant

  My First Book about Drucker.

  How to Make It Big as a Consultant.

  Drucker Swings into Action as a Consultant.

  How Drucker Got His Start as a Management Consultant.

  Drucker’s Peculiar Advice about Almost Everything.

  Consulting and the California Institute of Advanced Management.

  How to Use and Master Drucker’s Techniques and Concepts.

  Chapter 2

  The Drucker Consulting Difference

  Applying Drucker’s Methods Requires Understanding.

  What Is a Social Ecologist?

  Drucker’s Strange Non-consulting Organization.

  How Drucker Became a Consultant Helped Form the Drucker Difference.

  Drucker Was Concerned with What to Do, Not How to Do It.

  The Most Difficult Aspect of Being a Drucker Client.

  Drucker’s Methodology of Conducting the Consulting Engagement.

  The Brain Is for Thinking – Use It!

  Drucker’s Caution in Applying “Breakthrough” Ideas.

  Drucker’s Emphasis on Feelings over Numbers in Decision Making.

  Chapter 3

  What We Can Learn from How Drucker Developed as a Management Consultant

  Did Drucker Always Plan to Become a Management Consultant?

  Drucker’s Early Serendipitous Preparation for Consulting.

  Drucker Misses a Chance at College, But Gets a Serious Education.

  Hitler Causes Drucker to Drop Everything.

  Drucker’s Activities in England and His First Book.

  The Influence of World War II and Marvin Bower.

  Drucker’s Big Break.

  Chapter 4

  How Drucker Established a Top-rated Consulting Practice

  Why Do Consultants Become Consultants?

  Zeroing in on Preferences.

  The Advantage of Control over Your Life.

  The Question of Compensation.

  Location, Location, Location.

  Risky Business.

  The Importance of Goals and More Serendipity.

  Part-time Consulting.

  Part-time Consulting by Students.

  When to Transition from Part Time to Full Time.

  One More Consultant’s Tale.

  What Makes an Outstanding Consultant?

  The Ability to Interact with All Participants in a Consulting Engagement.

  The Ability to Diagnose Problems Correctly.

  The Ability to Find Solutions that Work.

  Technical Expertise and Knowledge.

  Good Communication Skills.

  Strong Marketing and Selling Abilities.

  Managerial Skills.

  Chapter 5

  Marketing Drucker’s or Anyone Else’s Consulting Practice

  Basic Drucker Marketing.

  The Primacy of Marketing over All Other Business Functions.

  The Important Distinction between Sales and Marketing.

  Not Reading Drucker.

  Theoretically, Perfect Marketing Would Make Selling Unnecessary.

  The Possibility that Marketing and Selling Are Not Complementary, but Adversarial.

  The Focus on the Customer and What the Customer Values.

  Marketing as a Pervasive Theme throughout the Organization.

  Did Drucker Take His Own Medicine?

  Chapter 6

  Drucker’s Ethical and Integrity Bedrock

  Drucker’s “Lies” and the License to Shade Statements for Emphasis.

  Drucker’s Ethics vs. Those Commonly Stated.

  Ethical Decisions May Be More Complex Than You Think.

  What Are We Talking About?

  The Distinction between What Is Legal and What Is Ethical.

  Drucker on Extortion or Bribery.

  Drucker’s Analysis of Ethical Approaches.

  The Ethics of Prudence.

  The Ethics of Profit.

  Confucian Ethics.

  Drucker’s Conclusions.

  Chapter 7

  Drucker’s Consulting Model Was to Ask Questions

  The Big Three Consulting Firms and How They Got that Way.

  The Primary Difference in Drucker’s Consulting Model.

  The Client Is the Real Expert.

  Asking Your Own Brain Questions.

  Why This Strange Technique Works.

  The Power of Distraction in Problem Solving.

  Drucker’s Five Basic Questions.

  What Is the Mission of Your Client?

  Who Are Your Client’s Customers?

  What Does Your Client’s Customer Value?

  What Results Are Your Client Getting?

  What Is Your Client’s Plan?

  How to Develop Good Questions.

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p; Chapter 8

  Disregarding What Everyone “Knows” to Get to the Truth

  Drucker Was Right Again.

  What Everyone Knows Is Usually Wrong.

  Many Things that Everyone “Knows” Today Are Also Wrong.

  The Ancients Knew that 100% Agreement is Suspect.

  Drucker’s Wisdom Critical in Management and Therefore Consulting.

  Drucker’s Most Valuable Contribution?

  Why Krav Maga Training Has a Relatively Low Injury Rate.

  Drucker on Customer Value.

  How a 61-Year-Old Won the World’s Toughest Ultra Marathon.

  Applying this Lesson as a Consultant.

  Analysing an Assumption.

  Tracking Down the Origin.

  Is the Source Valid?

  Chapter 9

  How Drucker Used his Ignorance to Consult in Any Industry

  Ignorance Has Value.

  Analysing Drucker’s Claim of Ignorance.

  The Beauty of Ignorance in Problem Solving.

  Left-brain Problem Solving.

  Building Ships at High Speed.

  Problem Definition.

  Relevant Factors.

  Alternative Courses of Action.

  The Analysis.

  Conclusions and Recommendations.

  The Right-brain Solution.

  Helping the Subconscious Solve Consulting Problems.

  Chapter 10

  Drucker Tells his Clients What to do about Risk

  Even Attempting to Lower Risk Could Be the Wrong Move.

  One of Drucker’s Few Errors Was of this Type.

  The Story of the Unlucky General Who Took the Wrong Risk.

  Picking the Right Risk Is Crucial.

  Risk Controls and their Characteristics.

  The Near Impossibility of Objectivity and Neutrality When Dealing with Human Beings.

  Focusing on the Real Results.