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William Guth, the moderator, begins the session introducing Peter F. Drucker as a panelist and highlighting his career accomplishments alongside fellow contributor Dale E. Zand. Drucker begins his talk discussing how happy he is to be back at New York University’s Graduate Business School, and how the human resources management job is in a period of transition. Drucker then supports this observation in stating that, as organizations begin to be restructured around information, he is rapidly finding that such an alteration changes the character of the organization. As a result, fewer and fewer managers are needed in organizations. He goes on to note that, whenever organizations have become more information-based, he has found that most levels of management turn out to be information relays, have no decision responsibility, very little management responsibility, and become redundant. Moreover, they are being replaced with groups of specialists, each operating theoretically with very few intermediate layers, and Drucker compares these specialists to bassoon players in an orchestra. Drucker then contends that the next few years will be very difficult for the management of people, since the new people coming in are inevitably going to be disappointed because they expect the same promotion and opportunities as their predecessors. People need to have their expectations changed, he says, and that can only be done if jobs are restructured. Policies, procedures, and compensations will also have to be developed. Drucker then gives the example of banks, and the position of bank tellers, specifically, to illustrate how certain positions in certain industries are being phased out or reduced to part-time occupations. He proceeds to note that there is never a hierarchy of people, only a hierarchy of knowledge, and that managers must learn how to balance large bodies of colleagues. He also notes that managers will have to learn how to make knowledge work productively because it has been become the cost center, and must be effectively managed to optimize yield. Managing people as a resource is already changing and will continue to change drastically. Teaching personnel management will also continue to evolve as human beings engage in joint performance. Drucker then takes a question from the audience on knowledge worker productivity--what it is and how to measure it--and begins to describe, first, what it isn’t. He then states that managers have to define what output is, and that managers are nowhere near it in most areas. He states that managers have made the most progress in a few top medical schools. In knowledge work, the basic rule is that no two human beings are alike, and that one can only produce by putting strength to work rather than incompetence. Consequently, one has to know the performance strength of the individual, rather than their potential, so proper placement becomes crucial. Furthermore, essential to productivity of knowledge work is concentration of efforts. Drucker states that one of the toughest jobs in management is how to encourage workers without encouraging them so much that they take over. Drucker then responds to a question concerning the competitiveness of business over the next five to ten years, and describes how companies in different sectors/fields will change in an increasingly globalized and more fully employed workforce. He concludes that all changes occurring presuppose somebody in the center who has an ear to management and can reveal what traditions are becoming counterproductive.
Drucker, Peter F. (Peter Ferdinand), 1909-2005 Guth, William D New York University New York University. Graduate School of Business Administration Management Management by objectives Management science Specialists Bassoon Orchestra Job rotation Banks and banking Teller Bank tellers Knowledge and learning Knowledge workers Medical colleges Medical education Employee selection Employee motivation Competition Globalization Global economy and development Innovation Human resource management Job restructuring Output standards Business Competition Symposia
Original recording, April 29, 1987; Drucker Archives; Box 68