Explain the major contributions of Peter Drucker.

Some of the major contributions of Peter Drucker are as follows:

• ·         Nature of Management

Drucker was against “bureaucratic management’ and visualised Management with  creative and innovative characteristics. The basic objective of Management is to lead  towards innovation, The concept of innovation in his view is quite broad, which includes  development of new ideas, combining of old and new ideas, adaptation of ideas from  other fields and as a catalyst in encouraging others to carry out innovation. Drucker is  generally placed in ‘empirical school of management’. He treated Management as a discipline as well as a profession. As a discipline, Management has its own tools, skills, techniques and approaches. However, Management is more a practice rather than a science. While talking about Management asa profession, Drucker does not advocate treating Management as a strict profession, but only a liberal profession which places more emphasis that managers should not only have skills and techniques, but also the right perspective putting the things into practice. They should be good practitioners so that they can understand the social and cultural requirements of various organisations and countries.

 

• ·         Management Functions

According to Drucker, Management is the organ ofits institution. It has no functions in itself, and no existence in itself. He sees Management through its tasks. Accordingly, there are three basic functions of a manager, which he must perform to enable the institution to make its contribution towards:

• ·         the specific purpose and mission of the institution whether business, hospital or university.
• ·         making work productive and the worker achievement-oriented; and
• ·         managing social impacts and social responsibilities.

 

All these three functions are performed simultancously within the same managerial action. A manager has to act as an administrator, where he has to improve upon what already exists and is already known. He has to act as an entrepreneur in redirecting the resources from ‘seas of tow’ or diminishing results to areas of high or increasing results. Thus, a manager has to perform several functions: setting of objectives, making, organising and motivating. Drucker has attached great importance to the objective of setting functions and has specified eight areas where clear objective setting is required. These are: market standing, innovation, productivity, physical and financial resources, profitability, managerial performance and development, worker performance and attitude, and public responsibility. These features are common to the study of public administration and can be studied parallelly.

 

• ·         Restructuring Government

Drucker was against the bureaucratic structure because of its too many dysfunctional effects. Therefore, he wanted that it should be replaced. He thus emphasised three basic characteristics ofan effective organisation structure and these are:

• ·         Enterprise should be organised for performance.
• ·         It should contain the least possible number of managerial levels; and
• ·         It must make possible the training and testing of tomorrow's top manager- responsibility to a manager while still he is young.

He identified three basic aspects in organising Activity Analysis, Decision Analysis, and Relation Analysis. An Activity Analysis shows what work has to be performed, what kind of work should be put together, and what emphasis is to be given to cach activity in the organisation structure. Decision Analysis takes into account the four aspects Of a decision: the degree of futurity. In the decision, the impact of decision over other functions, number of qualitative factors that enter into it, and whether the decision is periodically recurrent or rare. Such an analysis will determine the level at which the decision can be made. Relation Analysis helps in defining the structure and also to give guidance in manning the structure.

 

• ·         Federalis

Drucker advocated the concept of Federalism. It refers to centralised control I decentralised structure and decentralised structure goes far beyond the delegation of authority, It creates a new Constitution and new ordering principle. Drucker emphasized the close links between the decisions adopted by the top management on the one hand and by the autonomous unit on the other. Ina federal organisation, local management should participate in the decision that set the limits of their own authority. Federalism has certain positive values over other methods of organising.

 

These are as follows:

• ·         It sets the top management free to devote itself to its proper functions.
• ·         It defines the functions and responsibilities of the operating people.
• ·         It creates a yardstick to measure their success and cffoctiveness in operating jobs and
• ·         It helps to resolve the problem of continuity through giving the managers of various units education in top management problems and functions while in an operating position.

• ·         Management by Objectives

Management by Objectives (MBO) is regarded as one of the important contributions of Drucker to the discipline of management. He introduced this concept in 1954. MBO has further been modified by Edward C.Schleh, which has becn termed as ‘Management by Results’. MBO includes methods of planning, setting standards, performance appraisal. and motivation. According to Drucker, MBO is not only a technique of management, but it isa philosophy of managing. It transforms the basic assumptions of managing from exercising to self-control. MBO works from botton-up as well as from top-down. At organisational level, MBO links objectives of one level to another, and at a personal level. it provides specific performance objectives. MBO programmes have four elements: goal specificity, participation, time period and performance feedback for an MBO system to work, The organisational objectives must meet four criteria:

• i)        They must be hierarchically put from most important to least important.
• ii)       Quantification of objectives.
• iii)     Specific goals.
• iv)     Consistent goals.

Therefore. in order to practice MBO, the organisation must change itself. MBO has become sucha popular way of managing that today it is regarded as the most modem Management Approach. In fact, it has revolutionalised the management process.

 

• ·         Organisational Changes

Since rapid changes are occurring in the society, human beings should develop philosophy to face the changes and take them as challenges for making the society better. This can be done by developing dynamic organisations, which are able to absorb changes much faster than static ones. Drucker’s contributions have made tremendous impact on the management practices. “Drucker shows certain farsightedness and understanding of the development prospects of modern production when he opposes the view that worker is no more than an appendage of machine. Moved by a desire to strengthen the position of capitalism, he endeavored to give due consideration also to some objective trends in production management. Drucker, therefore, tells the industrialists not to fear a limited participation ofthe workers in the management of production process. He wams them that ifthey do not abandon that fear, the consequences may be fatal for them”. Drucker is perhaps the only Western management thinker who has attracted so much attention of the Communist World.

 

• ·         Rethinking and Abandonment

Drucker rejects the concept of downsizing organisations, which could prove fatal in the long run. So he proposes rethinking, which relates to identifying activities that are productive and need to be strengthened, promoted and expanded. He also suggests that that there is a need to rethink on the organisational set-up based on activities and suggestions. Peter Drucker coined leadership terms and strategies that are still used today. He advocated a more flexible, collaborative workplace, and the delegation of power across the board.According to Drucker, “Management is doing things right; Leadership is doing the right things”. Unlike many early Management Theorists, Drucker thought that subordinates should have the opportunity to take risks, learn and grow in the workplace.

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