Wednesday, June 23, 2010

Generalizability: The Concept of the Corporation Chapter 2

Things often unfold as you are reading. Details come clear. The kind of process that Drucker is works best in situations where productive process can be isolated in a single unit. These ideas may not be the panacea that Drucker claims.

There are really two problems for most companies. The first is indeed that a number of productive processes can’t be done in a way that allows for competition between units. The second is that a single product or single production process can’t provide many useful market-based yardsticks for managers beyond cost accounting. We move from return on investment to minimizing cost, which is radical change. We move the market to Frederick Winslow Taylor.

Drucker gives some examples. They may provide models for midsized companies. We shall see.

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