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Date: 2024-04-24 Page is: DBtxt003.php L0900-ML-Peter-Drucker-01a
Leaders in Management
Peter Drucker
Management Guru ... lived 1909 - 2005
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Peter Drucker famously said you manage what you measure ...

This is undoubtedly true ... in the corporate world, the components that go into making profit are measured intensely in order to improve profit performance ... and it works!
Unfortunately, we don't do anything like the same amount of measuring in order to improve society and avoid degrading the environment ... and we don't have any easy way of talking about social performance and environmental performance in the same way that we are able to talk about corporate performance and investment portfolio performance.
This has to change
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At TVM, we argue that you had better measure the right things
TPB note (written around 2010): Management accountancy and electronic data processing (EDP) enabled the optimization of profit performance during my adult lifetime and legitimized by fashionable universities like Harvard (the Business School) and Chicago (Milton Friedman). This resulted in financialization of the system. The system needs to be brought back in balance with social, environmental and economic issues all managed in a complex optimized manner.
More TPB commentary ... July 2023

Over time, my views about business management and policy choices have evolved substantially. Most of the teaching of Peter Drucker continues in my view to have value, but I am no longer much of a supporter of the teaching of Milton Friedman whose support of the primacy of business profit was in my view seriously misguided.

It has become clear to me over time that there are some important strengths associated with big corporate business organizations especially as regards productivity and economies of scale. However, the idea that the ultimate and only goal is to maximise profit for owners / investors is outdated and in the context of the modern world, just plain wrong and fundamentally immoral!
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