The talk begins with Drucker addressing the topic of cronyism in institutions, and the class works through defining what, exactly, the term means, and why cronyism is problematic. Drucker states that, in spite of the class being able to identify what cronyism is and recognize it as a troublesome issue, all of the students in the course will engage in cronyism when they reach the top of their professions and career paths. Drucker then recounts the career of several politicians, including Dwight D. Eisenhower and Abraham Lincoln, to highlight how cronyism has functioned successfully in history. He goes on to state that friendship is a part of work as well as a part of life, and unavoidable in successful relations because without friendship, one can become too insulated. At the same time, one must keep free from destructive entanglements that may compromise job stability and performance. To be an effective manager, managers have to learn how to communicate with humanity, humanely, and effective executives force themselves to have real friends in an organization, and they think through how one builds effective coalitions. Drucker gives the example of General George Catlett Marshall Jr. as an example of someone who shunned friendship and close human contacts, and the class proceeds to talk about the topic of management development. Drucker states that it is very easy to do what we like to do, but that does not mean that we like to do it, and provides the example of Albert Einstein, who hated his mathematics homework but completed it wonderfully. He connects the Einstein example to managers who really know how to manage people but can never quite figure out how to do it, the problem being that they never open their mouths to communicate effectively. Drucker then discusses the human condition and how people have a need to be right before moving on to consider how banks often understand finance, but do not understand business. Business depends on teams, and teams depend on knowing each other. Drucker goes on to give several examples of different types of temperaments to demonstrate what it means to know one’s teammates effectively, and how one should perceive and approach them. A team, he says, is not something one can improvise, so it must be built before it is needed, and before it can be paid for. He goes on to emphasize what it takes to make a governing board effective, stating that it is hard work, and that it is, no matter the professional sector or field, a nineteenth century institution, based on the assumption that a business is small, local, and producing a single product, with five shareholders having their fortunes in the business. Drucker states that a manager should not become too familiar with their subordinates, and that managers require someone they can trust personally to understand their problems and provide guidance--the board serves, in part, to accomplish this. He then suggests that the class individually thinks through what the function of the board is--what their task is and what is expected of them--and states that any manager should determine the two or more people that can be collaborated with to institute change in an organization. Drucker continues on to describe the three systems of administration in the world, the first being the Chinese; the second, the Boy Scout system; and the third, the manager with an effective board. He then states that the stronger the leader in an organization, the more difficult the succession crisis, as strong leaders do not breed strong successors; they breed assistants. Drucker then relates that one of his heroes, George Marshall, accomplished succession consciously and successfully because he necessarily restrained himself. He closes the lecture commenting that no leader has ever come into his/her position knowing what to expect, citing several U.S. presidents and their tenures to support his claim. He then claims that a board is required to manage a strong leader and acknowledge his/her flaws, and cautions against staying in a job waiting for a leader to retire or die, stating that one “does not wait for dead man’s shoes” because it corrupts. The class moves on to the topic of how to make decisions involving placing people in positions within an organization, or “people decisions,” and how to transfer technology from one part of a company to another. Drucker comments that transfer of technology is something that people do not understand--all people know is that at certain times, certain technologies travel faster than others. He proceeds to observe that we cannot know if technology represents a social, economic, or scientific phenomenon, and that the focus should be on transferring people, rather than technology, to create growth and innovation. Drucker comments that in the electronics, aviation, and medicine industries, technology transfers occur more readily.
Drucker, Peter F. (Peter Ferdinand), 1909-2005 Claremont Graduate University Claremont Graduate School Claremont Graduate University-Faculty Claremont University Center Eisenhower, Dwight D. (Dwight David), 1890-1969 Lincoln, Abraham, 1809-1865 Friendship Management Management by objectives Management science Marshall, George C. (George Catlett), 1880-1959 Einstein, Albert, 1879-1955 Banks and banking Business Business communication Business, culture and change Teams in the workplace Corruption Technological innovations Technology Technology transfer Electronics Medicine, technology, and society Medical technology Boy Scouts Chinese Cronyism Management development Succession, Executive Aviation technology Aviation electronics Electronics technology
Source
Original recording, 1978; Drucker Archives; Box 68
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