Peter F. Drucker symposia question-and-answer session on populism and anti-Semitism, Stalinist Russia, privatization, the common market, the petroleum exchange, early and mid-career endurance, specialty businesses, and the importance of human touch in business relationships
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The symposium continues with a question-and-answer session featuring Peter F. Drucker and Alex d’Arbeloff. The first question, directed to Peter F. Drucker, concerns populism and if the resentment toward corporate financiers will develop anti-Semitic strains. Drucker responds that American populism has had anti-Catholic strains, but has never been anti-Semitic, which he describes as a distinctly European development after the Panic of 1873. He goes on to discuss Konvatchev, a communist who was executed under Stalin’s regime because his model showed that collectivization would destroy productivity. Drucker argues that, according to Konvatchev’s cycle, the U.S. should have been in an extreme depression about ten years ago. However, Drucker notes that it has not happened for two reasons, namely, the fact that the new industries, in some parts of the world, are growing much faster than in the Konvatchev model, and, second, the industrial economy of the world has separated from the raw material and food economy. He also imparts the wisdom that an organization should not make short-range decisions exclusively--one makes short-range decisions on the basis of long-range goals. Drucker then responds to a question concerning education and health, and their privatization. The greatest opportunity for private industry is not in healthcare, Drucker notes, but in creating community. So, leisure and retirement communities are seeing tremendous development. He thus recommends that executives look for where the opportunities are, and disregard the title of industries, because they are changing very quickly. Instead, he recommends concentrating on the content of industries. D’Arbeloff proceeds to reply to a question concerning the common market, stating that he has observed little change in the common market and that he does not see the big trends that will unite Europeans together, while Drucker predicts that executives will see something much closer to the way American companies operate in Europe already, because American companies operate in a European economy. They thus look upon national markets as restraints. Drucker continues on to respond to a question on petroleum, stating that it is conceivable that within four years, there will be a regional block in petroleum because the American strategic position is becoming very weak. If the petroleum price keeps decreasing, it is conceivable that a very high prohibitive tariff will be implemented on petroleum and hydrocarbons that do not originate in the Western Hemisphere. To optimize results, one must be multinational, but the fact that petroleum dependence may damage and impair the U.S.’s own petrochemical industry is not much of an argument against multinationals. A question is then posed concerning how to survive the cognitive dissonance in industrial positions until an executive reaches a senior level of management, and Drucker suggests that one should, first, make the job as big as one can--do not just respond on the job to one’s tasks, but think about how certain group and individual contributions can be made that would make a difference if done expertly. Second, Drucker recommends that executives think in a long range perspective about what they want to be remembered for, and, third, make sure that executives take charge of their careers and determine where they belong and what they do well. Fourth, and last, is having a major outside interest in which one comes in contact with people with different values and terminology. D’Arbeloff responds that in the electronics industry, contrary to the questioner’s assumptions, not enough people think or initiate, and electronics needs more people that can and do. Drucker goes on to state that he would have told the questioner to quit--an employee should not wait for dead man’s (or woman’s) shoes, as it is corrupting. Another respondent then delivers advice to the previous questioner concerning what to do in her position with cognitive dissonance before posing a question to the panelists on the concept of specialty business. Drucker states that there are three kinds of very different businesses--the commodity business, the product business, and the specialty business. The specialty business is one in which one operates in a niche market, wherein the business does something that few other companies can do effectively--there isn’t that much volume, there is a constant challenge of doing better, and it has the great advantage of knowing the customer’s business better than the customer does. Institutional money management, for instance, has become a specialty business. Specialty businesses have limits and require great flexibility and great speed. Drucker then discusses MBA major concentrations and relates that schools will have to learn to become schools of management, not finance, and attract non-business people because that is where the growth is. In the end, personal skills in human relationships will also be necessary, and Drucker concludes that people will have to be able to manage both themselves and their bosses in the future.
Drucker, Peter F. (Peter Ferdinand), 1909-2005 New York University New York University. Graduate School of Business Administration Populism Anti-Semitism Anti-Catholicism Stalin, Joseph, 1879-1953 Collectivization of agriculture--Soviet Union--History Short-term business financing Long-term business financing Privatization Leisure Petroleum Hydrocarbons Tariff Western Hemisphere Multinational corporations Petrochemicals Middle managers Cognitive dissonance Legacies Hobbies Money management Master of business administration degree Finance Nonprofit organizations Nonprofit organizations - United States - Management Interpersonal relations Management - Employee participation Management Symposia Panic of 1873 Konvatchev Placement Specialty business Commodity business Product business Niche market Management education Personal skills
Original recording, April 13, 1988; Drucker Archives; Box 68