And the world's greatest independent consultant is...?




Consulting has always fascinated me. I think maybe this started with Sir Arthur Conan Doyle’s famous character, Sherlock Holmes, who was according to Doyle, a "Consulting Detective."

Here was a totally independent expert who answered to no one. He did as he pleased, and though many powerful law and order officers and administrators were frustrated and occasionally even actively opposed his participation and methods, he was called upon again and again to solve criminal mysteries which they were unable to unravel. His expertise never failed to provide a solution. Without a doubt, Holmes was the world’s greatest fictional consulting detective.

Peter Drucker wasn’t fictional. Yet, from within management - a field heavily populated with highly paid management consultants and world-renowned management consultant companies - Drucker still stands out.

James O. McKinsey, a professor from my alma mater, the University of Chicago, founded the consultant firm of McKinsey and Company in 1926 (he left the firm in 1935). This year, just twelve years short of 100 years after its founding, the firm is still ranked as number one, and the New York Times still calls McKinsey and Company "the most prestigious consulting firm."

The firm of Peter F. Drucker & Associates doesn’t exist and never did, because Peter never founded it. He worked alone. He even answered his own phone. Those who were his clients or his intimates probably remember calling and hearing a deep and ponderous voice uttering one simple sentence in a heavy Viennese accident, "this is Peter Drucker."

Yet Drucker is respected no less nor is he less well-known than mighty McKinsey and Company despite their 9,000 consultants in 97 locations in 55 countries and annual revenues of about 7 billion dollars a year. And Drucker died in 2005!

Why is Drucker so honored?

As I’ve noted numerous times in the past, Drucker was a genius. Frankly, there are a lot of geniuses around including of both the unrecognized and unrewarded, variety, and the well-known celebrity type which can be sub-categorized as malevolent or benign; ineffectual or highly effective, living or failing to live up to an undefined potential and more. The definition of genius has very clearly become unclear.

In fact, I believe that just about anyone can achieve genius status, or at least be acclaimed as such with some devotion and effort, depending upon the field of expertise and a host of sometimes irrelevant other factors.

Drucker was a special type of genius. When we consider the single field of management consulting, and especially operating as an independent consultant, we can see how important personal habits, traits, and values are in achievements as a consultant, and what he as an individual did differently. My observation and analysis of what made Drucker great was that there was a "Drucker Difference" and that he did three things very different from others.

Drucker said that thinking was hard. I thought this was a pretty lame observation until I really tried to do it when I was much older than I should have been. Then I realized how Drucker worked through his ideas and actively struggled with them intellectually until he was satisfied that he had reasoned to the correct conclusion or solution no matter how long it took; and if there were no correct solution or a certain conclusion could not be established to his satisfaction, at least he had the best conclusion or solution that he could come up with.

For example, he fought mightily to come up with the correct way to implement ethics. He cast a wide net, beginning with ethical philosophies from the western tradition and expanding his search both geographically and historically.

Drucker objected to any "new business ethics" which asserted that acts that are immoral or illegal if done by private citizens became moral and acceptable, if not legal, if done in the context of a business organization. Various actions might be stupid, they might be illegal, and they might be the wrong thing to do. However, they were not necessarily "business ethics."

Drucker delighted in telling his students that procuring prostitutes for visiting executives didn’t make you an unethical business person. It just meant that you were a pimp.

He examined the ethics of responsibility, the ethics of prudence, the ethics of responsibility, and the ethics of profit. He analyzed Judeo-Christian religious doctrine and that of Buddhism. Always he found imperfections and exceptions to rules.

Finally, he declared that there were only ethics, not "business ethics" and that the best that could be done were buried in the writings of the ancient Greek physician Hippocrates. "Primum Non Nocere," he wrote. That’s Latin for "above all do no harm."

However, here I get to correct my teacher. He said that this was from the Hippocratic Oath sworn to even today by all physicians. It wasn’t. It was from another piece that Hippocrates wrote called "Epidemics":

""The physician must ... have two special objects in view with regard to disease, namely, to do good or to do no harm," according to the translated text.

Abandon the Concept of "Common Knowledge"

According to Drucker, common knowledge was knowledge believed by all, but was offered up with no proof. One of Drucker’s favorite sayings was "What everyone knows is usually wrong."

Drucker was right, "common knowledge" was commonly wrong. Some have even written books collecting these wrong things that everyone knows. My favorite has to do with the aforementioned Sherlock Holmes. The detective’s most famous utterance, as everybody knows is "Elementary, my dear Watson."

However, as I said, Peter was right. In all of the many adventures that Conan Doyle wrote, not once did Sherlock speak this well-known line. Instead we must look to the movies and the famous series of Holmes’ movies during which the English actor, Basil Rathbone gave Holme’s voice to these immortal words.

On to the subject of management Drucker was one of the first to demolish the notion that sales and marketing were really the same thing and went on to explain their differences.

But he went further. He said that not only were sales and marketing not the same, they were not even automatically complementary and could be adversarial.

In the light of what everyone knows, I consider this one of the most astonishing statements that Drucker ever made and I think many marketing professors might be ready to take him on. Most marketing textbooks simply list sales or selling as one of a number of marketing subsets, on a par say with advertising or marketing research.

Unfortunately, Drucker never really explained his reasoning. Although I certainly had my doubts when I first heard him make this statement, he was right again, though this simple claim requires some thought.

Selling may be a subset of marketing, but it can still be adversarial to marketing because marketing is strategic and selling is tactical. So if the wrong market is attempted for a product, extraordinary salespeople may succeed because they have the ability to "sell anything to anybody."

However their success when they are selling in the wrong market will be limited and may mislead decision makers to invest even more resources in a market which is extremely difficult in which to sell this product (whereas a different market might result in a far greater and easier success).

Thus in this context, the two can be adversarial. Marketing managers should strive to have their sales and marketing efforts support one another, and Drucker recognized that with exceptional selling, but poor marketing, this unwanted adversarial result could occur.

Put Right above Expediency

There are those in business who take the view that they are simply giving their customers what they want. They take no responsibility as to whether their products or services are of benefit or are even potentially dangerous to their users.

Looking back at the issue of ethics, theirs is the ethics of profit. If it is profitable it is acceptable, since according to them, this is the "business ethics," which Drucker denied.

As the Mafia don declared as he slew a competitor: "It’s nothing personal, it’s just business."

Drucker dug much deeper and examined the very notion as to the purpose of a business. "The purpose of a business," he declared, "is not profit." "The purpose of a business is to create a customer."

How simple and yet how eloquent – and how right!

Steve Jobs, never haven’t studied marketing in the halls of the great universities, in fact never having attended any university, he nevertheless created a great industry and became a billionaire, not by focusing on profits, but by his great success in creating customers. Commented Jobs: "If you keep your eye on the profit, you’re going to skimp on the product. But if you focus on making really great products, then the profits will follow."

Drucker’s greatness as a consultant rests on three principles:

  1. He practiced thinking
  2. He abandoned the notion of common knowledge
  3. He place right above expediency

These practices are applicable in an infinite number of practices and human endeavors, and will likely lead to similar extraordinary results as Drucker obtained.