Peter Drucker and Social Innovation

Was spending some time over at Changing Higher Education and was reading a post on higher education’s social responsibilities in a globalizing economy. A lot of the piece is about educating workers that satisfy the needs of today’s businesses. The post then went on to reference some of Peter Drucker’s writings and linked to a great article on Drucker by Michael Hiltzik  of the LA Times on Dec. 31, 2009. From Hiltzik:

Drucker’s most important insight concerned the role of the corporation in society. “The business enterprise is a creature of a society and an economy, and society or economy can put any business out of existence overnight,” he wrote in 1974. “The enterprise exists on sufferance and exists only as long as the society and the economy believe that it does a necessary, useful, and productive job.”

From that simple observation sprung a wealth of further insights. It placed the corporation’s social responsibility in perspective by establishing its breadth and its limitations.

Drucker showed that there is no “inherent contradiction between profit and a company’s need to make a social contribution,” but that the former is indispensable to achieve the latter. He also warned that an enterprise that fails to “think through its impacts and its responsibilities” exposes itself to justified attack from social forces. Consumerism and environmentalism, he taught, are not enemies to be vanquished, but symptoms of business’ failure to understand its broad social role.


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