Before Warren Buffet there was Peter Drucker
Peter Drucker’s first great contribution was to focus on management as a discipline in its own right. In so doing he has been credited with changing the face of industrial America. Drucker went on to invent many of the concepts that are now part of our common language.
WHAT IS A BUSINESS?
The answer that is usually given is ‘It is an organization to make a profit.’ That is not only false, said, Drucker, it is irrelevant. Profit-seeking is not the purpose of management decisions but a test of whether they work.
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An organisation to make money
He goes on “If you want to know what a business is, we have to start with its purpose, which must be found outside the business itself… in society, in fact, since a business enterprise is an organ of society.
The Drucker Dictum
There is only one valid definition of business purpose – namely to create a customer.” This is the Drucker dictum that is best known around the world. “There is only one valid definition of business purpose – namely to create a customer.”
In the book ‘The Effective Executive’ Drucker says the purpose of a business is to create a customer and the business manager’s main tasks are:
to set objectives
to motivate and communicate
to measure results
to develop people (including him/herself)
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There is only one valid definition of business purpose – namely to create a customer. Do you agree or disagree with Peter Drucker? What are your reasons?
Plan your response for 2 minutes
You will need to speak for about 2 minutes