Drucker’s 33rd Book Sees Trends for Next Century

Peter F. Drucker, author, teacher, consultant to global business and Southern California resident, has just published his 33rd book, “Management Challenges for the 21st Century.”

Like most of Drucker’s books, dating to the 1930s, his latest is filled with thought-provoking observations, grounded in history rather than theory, on major trends in the economy and business.

Drucker, 89, also has definite ideas on Southern California, his home since 1971 when he took an appointment at Claremont Graduate University, where he teaches today. He considers the region’s prospects promising for reasons that grow out of the “certainties,” as he calls them, that are the subject of his latest book.

“The most important new certainty--if only because there is no precedent for it in all of history--is the collapsing birthrate in the developed world,” Drucker writes. He is referring to the decline of childbearing that, unless reversed, will reduce Italy from 60 million people to 20 million and Japan from 125 million to 55 million in the next century.

The trend is widespread, with population aging even in a developing country like China. The U.S. population is aging more slowly than most because of immigration and high birthrate patterns among offspring of recent immigrants.

Today’s low birthrates, even if they reverse in the new century, already dictate aging populations in most countries for at least the next 20 years, with profound consequences for business and politics.

Some consequences are already evident--delayed retirement in the U.S., for example, as a way of easing the burden on the Social Security system. People will have to prepare themselves for a working life of 50 years or more, Drucker says. Second careers and shifts of activity to social organizations will become commonplace in “the second half of life,” he says.

Financing the support of aging populations will add to the importance of retirement savings, which has been the fastest-growing business of the last 30 years. Thus, there will be even greater pressure on companies to produce returns to keep stock prices steadily rising while at the same time investing to see that the business survives for 30 and 40 years.

“We will have to establish new definitions of what ‘performance’ means in a given enterprise,” Drucker writes.

And we will have to learn how to measure the productivity of the knowledge worker, because most people will be engaged--as they are today--not in manual production work but in varieties of tasks involving knowledge. New accounting systems will be needed to measure the quality of their output, he says.

Drucker never bothers with the particulars of technology in discussing trends of the next 20 years. Indeed, he sees fascination with the tools of information technology--the computers and software programs--about to give way to emphasis on the content of the information transmitted via those tools.

Drucker’s inspiration is not an analysis of cybernetics but a look at what he calls the “first information revolution,” the invention of the printing press in 1450. For the first 50 to 100 years, Drucker relates, printers were showered with money and honors--as developers of leading computer and software firms are today. Printer Christophe Plantin of Antwerp was the Bill Gates of his day, the richest man in town, with a magnificent palace to show for it.

But the printers’ place of honor was soon taken by “what we now call publishers,” Drucker writes, and what was printed shifted from church texts to secular books on navigation, science, political ideas and novels. Universities arose, monasteries closed. The Protestant Reformation, Portugal’s voyages to India and Columbus’ voyages to the Americas followed the invention of printing.

In today’s second information revolution, the few consequences we can foresee are impressive. Education will change, Drucker writes. “Long-distance learning may well make obsolete the free-standing undergraduate college. The center of gravity will shift to the continuing education of adults and move off campus to homes and cars and workplaces.

“Health care will be defined as the maintenance of physical and mental functioning rather than as the fight against disease.”

Drucker has visited many of these themes before, in some 15 books on business management and another 17 books on economics, politics and society. Yet in “Management Challenges for the 21st Century,” he sees a new development in business and history. Individuals will have “to manage themselves” in the new century and new economy, he writes. Each person will have to determine how he or she can best contribute to the task at hand, the organization to which one belongs.

And that is where Drucker’s insights into Southern California come in. He sees it as a place encouraging individual effort over regimented work, with new people who will offer extraordinary levels of innovation in the coming decades.

Southern California is a place of immigrants, as Vienna-born Drucker himself was a 1937 immigrant to the United States. It is the sons and daughters of immigrants who will make the difference, he says. “They are hybrids of two cultures, and they have the energy and determination to show that they can do better. They are innovative.”

And they are in an innovative landscape. This is a decentralized place, Drucker notes, with 88 cities in Los Angeles County alone. “My own City Council in Claremont had to decide whether to allow a second fitness club. In large, traditional cities, such a decision would be made by a centralized bureaucracy. But here it is local.”

Other than that, Drucker says, “all I know about Southern California is the incredible beauty of its landscape.”

One further certainty: In 1971 that landscape attracted an original thinker.