I did not realize it at the time, but I grew up with Peter Drucker. My father spent 25 years in management at GE, and another decade at Chase Manhattan. He met Peter at GE’s Crotonville facility in the 1950s and always had Drucker’s books on his bookshelf. Though I had no interest in business as a high school or undergraduate student, I flipped through my father’s books-Drucker classics such as The Effective Executive and The Practice of Management. Later, when I was in the U.S. Navy, I grew more interested in business while running service and retail operations at a U.S. airbase in Japan, and returned to those and other classics. Slowly but surely, I was becoming a Drucker student.
Regrettably, I did not take the initiative to meet Peter until 1999. P&G was in the midst of major strategic change and arguably the biggest organizational transformation in its 162-year history. I was then responsible for P&G’s North America region, the big home market, and for P&G’s new global beauty business. I called Peter and asked if he would meet with me. He agreed, and four decades after he and my father had talked at Crotonville, I sat with Peter in his modest Claremont, California, home, talking about a world he had been thinking about for nearly a half-century.
I had hoped for one hour of his time. We talked for two. Then when my wife, Margaret, arrived to pick me up, she came in and we all sat and talked for another two hours. It was like drinking from a fire hose. For every question I posed, Peter had one or two more things to think about. Persistently, he urged me to choose, to focus on the few right strategies and decisions that wouldmake the greatest difference. He challenged me to understand the unique leadership challenges of managing an organization of knowledge workers.
That exhilarating first conversation provided the themes Peter and I returned to for the next six years: how to unleash the creativity and productivity of knowledge workers; how to create free markets for ideas and innovation inside and outside a company such as P&G; how to build the organizational agility and flexibility to respond to and lead change. Later, we began a conversation about another subject on which he was focused in the last years of his life: the work of the CEO.
As I’ve looked back on these conversations and countless hours reading Peter’s books and articles, I’ve thought about what made him so extraordinary. For me, it comes down to five things.
First and foremost, Peter’s basic rule was the importance of serving consumers. As he liked to say, “The purpose of a business is to create and serve a customer.” Plain and simple. At P&G, we have translated this principle into respect for the consumer as boss. Consumer-driven strategy, innovation, and leadership are cornerstones of P&G’s success and a reflection of the influence Peter has had on our company.
Second, Peter insisted on the practice of management. He had little patience for detached theory or abstract plans. “Plans are only good intentions unless they immediately degenerate into hard work,” he wrote. He and I readily agreed that execution is the only strategy customers or competitors ever see. I always came away from our conversations with clear, fresh insights that I could apply to P&G’s business and organization almost immediately. But Peter was not a single-minded evangelist for the virtue of execution. He believed in the power of strategic ideas and making clear choices. He said, “From quiet reflection will come even more effective action.” His ability to balance action and reflection is what makes his ideas so practical and so enduring.
The third characteristic that made Peter extraordinary was his gift for reducing complexity to simplicity. His curiosity was insatiable, and he never stopped asking questions. He called himself a “social ecologist” because he drew from history, art, literature, music, economics, anthropology, sociology, and psychology. From these many sources of inspiration came the clear questions and simple Drucker insights that lit the road to action: “Management is doing things right; leadership is doing the right things.” “The only way you can manage change is to create it.” “The marketer is the consumer’s representative.” His most enduring gift to future generations is that he taught so many others how to ask the right questions.
The fourth defining Drucker strength was his focus on the responsibility of leaders. Late in his life, he sharpened this focus on the responsibility of CEOs in particular. “The CEO,” he said, “is the link between the inside, where there are only costs, and the outside, which is where the results are.” For many reasons, business organizations become inwardly focused. Their business and financial measures are internal. Even if they have external metrics, those measures are often given lower priority because they don’t drive short-term financial performance or because they are less precise and more qualitative. Peter argued that the CEO is in a unique position to balance this inward focus. The CEO has primary responsibility for bringing the outside in, for ensuring that the organization understands the views of the market, current and potential customers, and competitors.
The fifth and most important of Peter’s many attributes was his humanity. He treated everyone with deep respect. “Management is about human beings,” he wrote. “Its task is to make people capable of joint performance, to make their strengths effective and their weaknesses irrelevant.” He noted that business and other institutions are “increasingly the means through which individual human beings find their livelihood and their access to social status, to community, and to individual achievement and satisfaction.” While he did not suggest that businesses exist to supply jobs, he argued that managers have a fiscal, societal, and moral responsibility to ensure that jobs are fulfilling and individuals are able to contribute as fully as they can. I could not agree more. The most important thing I try to do as CEO is to inspire leaders and unleash the creativity and productivity of P&G’s 135,000 knowledge workers.
Humanity infused everything Peter wrote and said. He was a force for good in the world. He received the U.S. Medal of Freedom because his management thought, beginning with Concept of the Corporation, helped develop free societies of organizations more productive than dictatorships of the left or right. This is his greatest contribution. Peter Drucker was one of a kind. He was relentlessly focused on the promise of the future and the potential of individuals. It is entirely fitting that one of his final requests was for a biography of his ideas rather than of his life.
Liz Edersheim has fulfilled this request with The Definitive Drucker. She has captured not only the essence of Drucker’s 39 books and seven decades of discovery and insight, but also the essence of Peter Drucker the man-the wise, funny, insightful, humble teacher who sat with so many of us in his living room asking questions and patiently giving us the time to catch up to where he had already leaped, the man who helped us see what he always described as “visible, but not yet seen.”
Through his example and his ideas, Peter will continue to be a force for good in the world for generations to come.