Management Paradigms: Old and New

by buildingpharmabrands

Peter Drucker

Peter Ferdinand Drucker (November 19, 1909 – November 11, 2005), the Austrian-born American management consultant contributed to the modern management thought significantly as an educator and author. He was a prolific writer and his writings influenced the way many organizations think and work even today.

Peter Drucker has been recognized as the father of the science of management. Starting with his first book in 1939, The End of Economic Man, Drucker wrote many ground breaking books such as Managing for Results, The Effective Executive, Managing for the Future, The Post-Capitalist Society, and Peter Drucker on the Profession of Management among others.

Peter Drucker had a distinguished career of teaching for over sixty-two years . For more than twenty years he taught at New York University as a Professor of Management and later at Claremont Graduate University in California from 1971 to 2002. He taught his last class in 2002.

Drucker developed one of the country’s first executive MBA programs for working professionals at Claremont Graduate University, which was later named the Peter F. Drucker Graduate School of Management in his honor in 1987.

At the beginning of the new millennium he wrote a book, Management Challenges for the 21st Century, in which he described the shifting paradigms of management. These are as valid  and relevant today as they were when he wrote, which was about twelve years ago.

Old Paradigm New Paradigm
1. Management is business management. Management principles apply to all organizations.
2. There is, or there must be one right organizational structure. Look for, develop and test the organization structure that fits the task.
3. There is, or there must be one right way to manage people. Don’t manage people. Lead them.
4. Employees are just what they are, employees. What they need is a pay check and some motivation. You get the work done by commanding and controlling. You need to treat employees as volunteers, not just employees. They want more than a paycheck; they seek interesting and rewarding work. You inspire them by leading, not commanding.
5. Innovations in your industry come from your own industry. Innovations in your industry don’t necessarily come from within your own industry. They are likely to come from  outside as well.
6. The economy is defined by national boundaries. National boundaries restrain but don’t define.
7. Technologies, markets and end-users are predefined for each industry. Customers, with their increasing disposable incomes dictate policy and strategy. Technologies crisscross.
8. National boundaries define economies. National boundaries restrain but don’t define.
9. Cheap labor is a major competitive advantage. Cheap labor won’t give a company a substantial advantage as manual labor is becoming smaller and smaller part of total costs. Labor productivity and not cheap labor per say will be a competitive advantage.
10. Change has to be managed. You cannot manage change. You can only stay ahead of change to win at the marketplace.