Mondejar, Calvin Paulo A.

Project (Individual part)

CEM/2
CEM112-C1
2013151011
September 16, 2015

The Practice of Management by Peter Drucker

A book by a management consultant, Peter Drucker talks about the
practice of management through management theories implemented and
principles applied in a company. The book by Drucker serves as a guide in
management in which the readers can utilize the book for evaluating
themselves in when it comes to their production, contribution, work, and
performance in their company or in any setting. The book also helps the
readers to analyze and know the core of their weaknesses in management
and recommend themselves some possible alternatives to improve
themselves as an effective manager.
Drucker wrote seven parts of practicing management in the book: the
importance of management, a marketing attitude is crucial, the nature of
organizations, the managerial role, the importance of moral responsibility,
management by objectives, and tasks for the manager of the future. Drucker
likewise pronounce in his book that management will still be a ruling and
basic institution because the practice of management is an influence of
Western civilization. Thus, as long as the Western civilization survives,
management will remain on top.
In the Practice of management by Peter Drucker, the principles used in
a certain company that were mentioned in the book are the principle of
decentralization, principle of production, principle of work, federal principle
of management, and a mass-production principle. While the implemented
theories in management that were mentioned in the book are the
Organization theory, the economic theory of business or the theory of the
maximization of profits, information theory, traditional economic theory,
and Mathematical information theory. The management theories and
principles mentioned in the book are applications, methods and advanced
techniques of Druckers concept in the managerial practice.
The first principle applied in a certain company according to Drucker is
the principle of decentralization. Drucker stated in the book about principle

of decentralization that To improve organization structure through

maximum of federal decentralization, and through application of the
principle of decentralization to functionally organized activities will therefore
always improve performance. This statement by Drucker shows that an
improvement of the performance output will be discovered once there is an
improvement in the organization structure of the company and an
improvement in the organized activities functionally by the use of the
principle of decentralization.
The second principle applied in a company is the principle of
production. Drucker wrote about the principle of production that, Marketing
itself is affected by the basic concepts of the new technology. We have, on
the whole, discussed Automation as if it were exclusively a principle of
production. The statement above explains that the marketing of the
company is influenced by the rapid growth of technology, and through
principle of production, a change from manual to automation produced by
the principle affects the marketing performance.
The third principle is the principle of work. This principle was stated in
the book that, The new technology does not, as did early individual
production, focus on skill as the integrating principle of work. It states here
that as the new technology affected the marketing of the company through
turning into an automation process, new technology also does not give much
attention at all when it comes to the skill as the integrating principle of work
in which before the new technology appeared, an individual production or
manually production in the company was in control.
The fourth principle if the federal principle of management. Drucker
wrote about this principle, In the large business the federal principle of
management organization is always the better one. In most large businesses
it is the only satisfactory one. This raises a problem of the relationship
between top management and the autonomous managers of federal
business. Even though for large business a federal principle of management
is better, particularly all large businesses corporations or conglomerates
think that federal principle of management is in the satisfactory level. This
creates a relationship problem for the higher ranks and middle ranks of the
federal business because federal business unites several large companies
but they remain independent when it comes to their internal affairs in their
own respective organization.
The last principle applied in the book is the mass-production principle.
Drucker stated that, It is above all the logical methods of Operations
Research that allow us to take the complicated analyses of products and
parts that are necessary to put the correct mass-production principle into

effect. This statement means that in order to get a cost reduction through
putting a correct mass-production principle into effect, one must take the
products complexed inspection by using the reasonable techniques of
operations research, which is a discipline that deals with the application of
advanced analytical methods to make better decisions.
The first implemented theory stated in the book is the Organization
theory. According to Drucker in the Organization theory, Indeed,
organization theory is the main subject taught under the heading of
management in many of our business schools. The organization theory is
considered as the main subject of taught because this theory is significant
for studying organizations to identify how they solve problems and how they
maximize efficiency and productivity.
The second implemented theory is the economic theory of business or
theory of the maximization of profits. Drucker said about this theory that,
Similarly, there is total bankruptcy in the prevailing economic theory of
business enterprise and behavior: the theory of the maximization of profits
simply a complicated way of phrasing the old saw of buying cheap and
selling dear. This statement defines that the theory of maximization of
profits is a complex type theory in which the business enterprise and
behavior economic theory experience bankruptcy in a company.
The third implemented theory is the information theory. Drucker stated
about the Information theory that, These mathematical and logical tools will
include operations research, information theory, and symbolic logic. The
mathematical and logical tools will be used by a chief executive job of
tomorrow in which an Information theory is one of the tools. Information
theory is also applied for the decision-making process that uses facts,
information, analysis, and process to come to decision.
The last implemented theory is the Traditional economic theory.
Drucker said about the traditional economic theory that, What does he look
for when he buys the product? Traditional economic theory has answered this
question: price. This statement means that it is traditional for buyers to look
for the price of the product first before purchasing, but Drucker said that this
type of approach is misleading and there is a small number of products in
which price is not included in the major considerations likewise price is not a
simple complex.