Peter Drucker's Way to the Top Read online

  ADVANCE PRAISE

  “Dr. Bill Cohen has done it again! In his latest book, Peter Drucker’s Way to the Top, he managed to stomp on my complacency, grabbed my attention, and sat me down to learn some new lessons and to unlearn a few stale truths that were no longer working. Thanks for the new epiphanies and insights, and for reminding me of what’s important.”

  Ariel Koropitzer, CEO, iSubTech Corp.

  FROM OTHER DRUCKER BOOKS BY DR COHEN

  “Peter F. Drucker helped me found the Peter F. Drucker Academy in China. It was a pleasure to see his concepts and what he instructed me brought together in one place and explained so that they could be applied by any executive. This is a valuable and useful book.”

  Minglo Shao, Chairman and CEO of the Bright China Group, Founder of the Peter F. Drucker Academy

  “William Cohen’s new book has brought the genius of Drucker to life for all of us. Easy to read, easy to understand and easy to use. The book should be in everybody’s leadership toolbox.”

  Howard Behar, President, retired, Starbucks International

  “Bill Cohen has done us a wonderful service by faithfully combing through Peter Drucker’s vast writings and weaving together Peter’s thoughts on marketing. This has never been done before. We owe it to Bill Cohen to have taken the various strands of Peter’s observations on all aspects of marketing and put them together in the 25 chapters of this fine book. I highly recommend his work to you.”

  Philip Kotler, Distinguished Professor of Marketing, Kellogg School of Management, Northwestern University

  “I am constantly amazed at how Bill Cohen is able to effectively and elegantly draw on his experience as Drucker’s student and then tie it together with his own research. If you want to apply Drucker’s theories and see how to do them in the real world, this book is definitely the place to start.”

  Jim Kouzes, Co-Author of the bestselling The Leadership Challenge, Dean’s Executive Fellow of Leadership, Leavey School of Business, Santa Clara University

  “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

  “Of the thousands of testaments written about a giant of our times – none can rival this. Only one person in the world could have written this book. Cohen has captured the essence of Drucker in every page of this marvelous book. Bravo, Bill – Peter would be proud!”

  Bill Bartmann, Billionaire Business Coach and winner of the National Entrepreneur Award from NASDAQ, USA Today, Merrill Lynch and the Kauffman Foundation

  “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, Co-Author of The Daily Drucker by Peter F. Drucker and Management by Peter F. Drucker

  “Peter F. Drucker helped me found the Peter F. Drucker Academy in China. It was a pleasure to see his concepts and what he instructed me brought together in one place and explained so that they could be applied by any executive. This is a valuable and useful book.”

  Minglo Shao, Chairman and CEO of the Bright China Group, Founder of the Peter F. Drucker Academy

  “Bill Cohen was a singularly stimulating and attractive student from whom my colleagues on the faculty and I learned at least as much as we could teach him.”

  Peter F. Drucker, 1983

  CONTENTS

  Foreword by Jenny Darroch

  1 How Drucker Became Drucker

  2 Four Entrepreneurship Strategies that Drucker Used to Build His Career

  3 If You Dare the Impossible, You Can Achieve the Extraordinary

  4 Drucker’s Insights into the Essence of Leadership and Success

  5 Drucker’s Views on Integrity, Ethics, Honour, and Doing the Right Thing

  6 What You Need to Know About Knowing Your Stuff

  7 Expectations and Their Declaration

  8 Forging Ahead with Uncommon Commitment

  9 The Importance of Expecting Success and How to Do It

  10 Taking Care of Your People

  11 Put Duty Before Self

  12 Get Out in Front

  13 Gaining Self-Confidence and Overcoming Fear

  14 Setting and Reaching Goals: Planning and Strategy

  15 Become a Change Leader and Innovate

  16 Marketing and Selling Yourself

  17 How Drucker Influenced Others

  18 How to Deal with Risk

  19 The Importance of a Positive Attitude

  Index

  An Introduction to William A. Cohen

  FOREWORD

  When General William (Bill) Cohen asked me to write a foreword for his new book, Peter Drucker’s Way to the Top, I was somewhat reluctant. As Dean of the Peter F. Drucker and Masatoshi Ito Graduate School of Management, I lead the Drucker School and protect the Drucker brand by making sure it remains well known and relevant to today’s audiences, but I do not see myself as a Drucker scholar. That’s not to say I don’t know Drucker’s work – I do, but I do not spend long periods of time studying what Drucker wrote. There are many others who have deeper knowledge of Drucker’s work.

  So, I sat down to read Bill’s manuscript, not sure what I could add or say about his latest book.

  I must say, I enjoyed reading the manuscript. It ultimately focuses on self-development but the book also provides a great overview of Drucker’s work and includes many examples – both old and new – to illustrate the points being made. Personally, I enjoyed the summaries provided of Drucker’s life and thought Bill covered the numerous topics on Drucker well.

  The finished product is a well thought out and well-written book – an interesting read. Topics include entrepreneurship, leadership, ethics, integrity, and morality, and management by objectives, but Bill also provides an overview of the qualities of a leader and guidelines on how to develop these qualities.

  I took many notes but I want to highlight two areas that caught my attention.

  First, Drucker famously said: “Results are gained by exploiting opportunities, not by solving problems.” (Bill uses this quote to open Chapter 19). I think of this quote a lot because I do feel that today’s managers often spend an inordinate amount of time going from one fire to the next or implementing policies that address problems (even if the problem occurred just once). This is especially true of older-established firms in industries facing disruptive change – e.g. hotels (think: Airbnb), taxis (think: Uber or Lyft), education (think: online classes or MOOCs), or cable television (think: Netflix or YouTube). As a manager, it is easy to allow the day to be filled with finding solutions to problems. Instead, and as Drucker advocated, a manager should switch his or her mindset to proactively identifying and exploiting opportunities. This simple shift of focus has a tremendous ripple down effect on organizational culture and employee engagement. I highly recommend it.

  The second area that caught my attention was Chapter 5 on ethics. In this chapter, Bill opens with another Drucker quote: “Integrity may be difficult to define, but what constitutes lack of integrity is of such seriousness as to disqualify a person for a managerial position.” And in Chapter 4, Bill reminds us of the well-known Drucker position on character: “Character is not
something you can fool people about. The people with whom a person works, and especially subordinates, know in a few weeks whether he/she has integrity or not. They may forgive a person for a great deal: incompetence, ignorance, insecurity or bad manners, but they will not forgive a lack of integrity.”

  These quotes are powerful reminders that we find ourselves in an unusual environment today, one in which many world political and business leaders do, at times, demonstrate a lack of integrity.

  As we look for guidance, Bill first offers definitions in Chapter 5: “Ethics is a code of values. Integrity speaks to adherence to this code of values. Morality is the quality of this adherence.” He then reminds us that Drucker saw Confucius’s principles as “the most successful and most durable [code of values] of them all”, partly because Confucius focused on interdependence and the importance of mutual obligations between, for example, employers and employees.

  My takeaway is a reminder that we have an obligation to lead with integrity and a responsibility to lead well-run, sustainable organizations that flourish and allow those connected to the organizations to also flourish. I am also reminded that we operate in a global and highly interconnected world where we have much to learn from people who have come from different histories and operate in different contexts.

  I want to close by congratulating General William Cohen on his latest book, Peter Drucker’s Way to the Top.

  Professor Jenny Darroch

  Henry Y. Hwang Dean, The Peter F. Drucker and Masatoshi Ito Graduate School of Management

  CHAPTER 1

  HOW DRUCKER BECAME DRUCKER

  The most crucial and vital resource you have as an executive and as a manager is yourself.

  – Peter F. Drucker

  HOW PETER DRUCKER BECAME A GURU

  Millions of managers worldwide have heard the name Peter Drucker. Even if you are not involved in management or business you may have heard that Drucker was the most famous management thinker over the last hundred years, and perhaps of all time.1 Few know, though, that Drucker could easily have qualified as a self-help and motivational guru even though ‘guru’ was a term he did not agree with when describing himself. Drucker not only believed in and taught self-development, but he practised the methods he developed (which he called self-management) himself. As noted by Drucker researcher Bruce Rosenstein, self-development is a major theme throughout Drucker’s writings and teachings.2 Moreover, Drucker believed that every person was responsible for their own acquisition of learning and applying these principles in their practice of business to reach their personal best. And there was a real reason that this was important. “The most crucial and vital resource you have as an executive and as a manager is yourself; your organization is not going to do better than you do yourself,”3 he said.

  In an article in Harvard Business Review he wrote:

  We live in an age of unprecedented opportunity. If you’ve got ambition, drive, and smarts, you can rise to the top of your chosen profession – regardless of where you started out. But with opportunity comes responsibility. Companies today aren’t managing their knowledge workers’ careers. Rather we must each be our own Chief Executive Officer.

  Simply put, it’s up to you to carve out your place in the world in of work and know when to change course.

  It’s up to you to keep yourself engaged and productive during a work life that may span 50 years.4

  THE METHODS DRUCKER DEVELOPED TO REACH SUCCESS

  I don’t think that he intended it, but his own career and accomplishments confirmed his concepts. Drucker practised what he taught and wrote. And he reached even the loftiest of his goals and dreams. There are hundreds of great managers, and distinguished professors by the bunch, who could potentially claim the title that Drucker holds. Yet, if you input “The Father of Modern Management” into a search engine, you will see that it is his name which pops out – every time.

  How did this inexperienced young man, born and raised in Austria early in the last century become a seer, predicting events decades into the future, an advisor of powerful chief executives and heads of state about what they should or should not do? How did he write books that, years after his death, are read by tens of thousands of executives worldwide seeking success, who often go on to intensely study, reflect on, and apply Drucker’s wisdom to managing activities from corporations to politics to religion? It is only Drucker to whom Jack Welch, the legendary CEO of General Electric (Fortune’s “Manager of the Century”5), Rick Warren, Pastor of the famed Saddleback Church, and billionaire Chinese businessman Minglo Shao share common allegiance for success. And it is only for Drucker’s thinking and teachings that managers and academics from around the world have formed formal societies to study his ideas.

  DRUCKER’S LITTLE-KNOWN BIG SECRET

  I became his student by accident. Before the internet, it was his university that, partly at his urging, hit on the idea of an executive working part-time to earn a PhD. With all my time as Drucker’s student and my own considerable time in the military (I was a former Air Force major at the time and started my military service as a cadet at West Point), I never knew of Peter’s knowledge or admiration of the Army’s training, education, and methods to self-development until I attained my PhD from Drucker and our relationship changed from my being his student. It was partly from what I learned from Drucker that I became an Air Force general before I retired.

  Years later, his wife Doris told me that I was his favourite student. I certainly never knew this at the time, nor that this may have been due at least partly to my military background. True, he had on rare occasions cited examples or statistics from the military in illustrating management points he wanted to make to the class. But he did this with many other subjects too, from religions to many other occupations. As his students, we assumed this was further evidence of his vast general knowledge and experience. Once, in class, he commented that the reason for the large losses and missteps in battle during World War I was that “too few generals were killed”. This was an odd comment. Not only was Drucker not ‘bloodthirsty’, in any way, but he wasn’t any kind of fire-eater promoting a big military or an enlarged defence budget. According to Drucker, for the first time in history, because of technology, generals were not up at the front where they shared the same dangers as those they commanded. This not only had consequences for leadership, but also for knowing what was happening, and resulted in numerous mistakes in decision-making as well as unnecessary casualties.

  After graduation, we had many talks with regard to the military, several of which he initiated. His general knowledge of the profession’s methods, training, strategy, and even logistics in the military amazed me. He knew a lot about my profession.

  Some years after I studied with Drucker, I graduated from the year-long Industrial College of the Armed Forces in Washington, DC. I was asked if I could recommend a pro bono guest speaker who knew something about business. Of course, I recommended Peter although I cautioned the requester that he rarely travelled great distances to speak. He was already in his 90s and I doubted if Drucker would accept an invitation. I was wrong and was pleasantly surprised when I heard that he had accepted.

  Then, in 2004, only a year before his death, his admiration for the military was confirmed in a testimonial he wrote for Frances Hesselbein and General Eric Shinseki’s book Be, Know, Do: Leadership the Army Way (Jossey-Bass, 2004). “The Army trains and develops more leaders than all other institutions together and with a lower casualty rate,” he wrote.

  With this I knew Drucker’s secret for his personal self-development that he had never divulged, nor previously put in print. Drucker admired the military and had read extensively about military practices and strategy, and as you will see in this book, he applied many of their ideas in his own career.

  HOW AVOIDING COLLEGE LED TO GENIUS

  Drucker claims to have developed his start because he was encouraged to participate in conversations with his father and his father’s friends.
This may be common for many fathers, yet one doesn’t see their offspring being acknowledged as a genius, or becoming known as the founding father of anything except perhaps grandchildren. But clearly Drucker started with something somehow and his ideas grew to be powerful and effective. He learned from his mistakes and constantly refined his principles over his long lifetime of 96 years. Again, although a fair number of individuals live well into their 90s today they do not necessarily become acknowledged as the ‘father of modern management’. Most tend to repeat the same types of mistakes in particular activities without any improvement at all. Such was not the case with Drucker.

  As he grew older, Drucker did not at first want to attend a college, at least the way most students do. Instead he took an apprenticeship with a cotton-exporting company in Hamburg, Germany away from his parents. At that time, even more than today, an apprenticeship was mostly applied to the trades. The idea was very much like The Sorcerer’s Apprentice. Whether the intent was to become a sorcerer or something else, the apprentices were expected to spend their time mastering the work to learn the position. During his apprenticeship, Drucker had been attending night school, studying law at Hamburg University, even though his parents had the money and wanted him to study full-time in a prestigious institution as a more conventional student. After just one year Drucker quit the apprenticeship but continued studying. Then he got his first job as a journalist afterwards writing for a regional newspaper, the Frankfurter General-Anzeiger. Moving to Frankfurt after Hamburg, he again went to night school at the University of Frankfurt. He explained to us, his own PhD students, that he graduated in the easiest doctorate that he could attain; a practical PhD in international and public law.

  Until I wrote these words, it never occurred to me that all of us, his students at the time, were or had been senior executives and that we too were studying and working towards a practical PhD in his new PhD programme at what was then Claremont Graduate School. Today it is the Peter F. Drucker and Masatoshi Ito Graduate School of Management, part of Claremont Graduate University. Like Peter, we mostly went to night classes. While we were required to take one or two courses in each discipline, we looked at no discipline in depth nor took a multitude of courses in a single chosen business speciality as most PhD students did then and now. Therefore, while we considered the work challenging, our professors felt, for the most part, that we were getting an easy doctorate, rather than in-depth studies that would help us do research in a single discipline after the acquisition of our doctorates. This must have been very much like Drucker’s doctoral study in international and public law at the University of Frankfurt, a degree he completed in 1931. Drucker had designed this PhD, we had been told, to educate ‘super managers’ for the new challenges coming in the new century.