Born in 1909, Peter Drucker has been called the founder of modern management. A professor and consultant, he authored nearly 40 books, and established the first executive MBA program. His work examined the strategy, structure and management styles of the corporation and the realities of how people, both employees and customers really behave. He was decades ahead of his time, predicting many of the forces that would shape the economy of today, including decentralization, outsourcing, the decline of blue-collar employment, and even coining the term ‘ knowledge worker’. He also believed that companies shouldn’t serve profit alone, but strive to be noble and contribute to society. He was a strong supporter of the value of the non-profit sector, not just because of their impact on society, but the importance of volunteering for the volunteer.
Drucker is most known for his contributions to management theory. He also made substantial contributions to the field of marketing, most notably his attempt to make marketing a more central part of an organization rather than a just cost centre or peripheral function. He believed marketing was the responsibility of all senior leaders, including the executive and board, and not just an operational matter. He set out this belief, among many others, in his 1954 book The Practice of Management. There are two notable quotes on the role of marketing.
Because the purpose of business is to create a customer, the business enterprise has two – and only two – basic functions: marketing and innovation. Marketing and innovation produce results; all the rest are costs. Marketing is the distinguishing, unique function of the business.
– Peter Drucker, 1954
Marketing is not a function. It is the whole business seen from the customer’s point of view.
– Peter Drucker, 1954
Today, it’s debatable if marketing has found its place in the boardroom or C-suite. While many global companies have a CMO, it is much less common at the national or regional level. For many companies marketing remains an operational matter, rather than core function that both informs and executes on strategy. And in many ways, marketers only have ourselves to blame. The lack of evidence-based practice, challenges demonstrating value, and even the lack of a broadly accepted industry credential all hold marketing back.
Next week we’ll move just five years ahead and look at the classic, Symbols for Sale.
More on Drucker
In 2007, a study by Uslay, Morgan, Sheth study of the direct and indirect influence of Drucker on marketing and categorized his impact as follows:
- The Marketing Concept: Creating Value for Customers
- Broadened Role of Marketing in Society: Corporate Social Responsibility, Consumerism, Social Marketing, and Lessons from Nonprofit Organizations
- Contributions to Marketing Strategy: The Obvious and Not So Obvious
- Marketing-Innovation Interface: New Product Development
- Future of Globalization: Rise of Non-National Enterprises
The aim of marketing is to know and understand the customer so well the product or service fits him and sells itself.
Plans are only good intentions unless they immediately degenerate into hard work.
If you want something new, you have to stop something old.