CHAPTER | THIRTY-EIGHT
Is Leadership a “Marketing Job”?
One of Peter Drucker's far-reaching and integrative ideas isn't well known. This is his belief that good leadership is essentially marketing. People mistake this comment as recommending manipulation, which may be why it is a Drucker concept that is widely ignored. At least, I've never seen it in a leadership book or in a marketing book, except for one of mine. But it was in Drucker's book Management Challenges for the 21st Century, which he wrote in 1999, six years before his death. Leadership, Drucker stated, was a “marketing job.”1
But what was he thinking? Drucker never recommended manipulating subordinates. Quite the contrary. Peter Drucker's view was that all knowledge workers are partners in an organization. As partners, they cannot simply be ordered around and certainly cannot be “managed.” They have to be led. This leading involves not only persuasion, which is basic, but also includes an understanding of the goals and objectives of the business, some strategic thinking, and many other elements that we might normally consider part of marketing.
To understand this idea fully, it is important to recognize that Drucker did not say that leadership is “a selling job.” He said it is “a marketing job.” This is a critical difference. As mentioned in earlier chapters of this book, Drucker explained that selling involves persuading a prospect to buy a product that you want to sell, while marketing is about having a product that a prospect is seeking to buy. Thus, he felt that if marketing is done perfectly, selling is unnecessary.
Why Marketing Isn't Selling
It's fundamental to understand what Drucker believed about selling and marketing before we can relate it to leadership. In Chapters 22 and 34, I explained Drucker's position on marketing. To reiterate, he wrote that not only is marketing not selling, but that the two might not even be complementary. Many marketing experts might take issue with that extraordinary notion, but let's look at marketing first.
Drucker explored the mysteries of marketing, a subject that is second only to leadership in its apparent simplicity yet frequently is even more difficult in its implementation and application. Famed marketing Professor Philip Kotler, who is often referred to as the “Father of Modern Marketing,” said, “If I am the Father of Modern Marketing, then Drucker is the Grandfather of Modern Marketing.”2
In his first book on management, Drucker wrote that there are only two basic functions of business: marketing and innovation. He went on to say that any organization in which marketing is either absent or incidental is not even a business. Thirty-six years later, in a detailed interview with Kotler for inclusion in Drucker's book Managing the Nonprofit Organization, Drucker made clear that marketing was not just a concept for business, but for other organizations as well.
What Drucker believed about selling and marketing is the next step in our understanding of this concept. He saw marketing as concerned with top-level thinking, decision making, and strategies. Below this level are various means of carrying out these strategies: advertising, selling, pricing, distribution means, and so on. Many refer to these as lesser strategies useful in the implementation of bigger strategies—they call them “tactics.” Like the words selling and marketing, tactics and strategies are not the same thing. Strategy is far more important than tactics. In fact, even when your tactics are less than perfect, if your strategy is the correct one you can still be successful. That's also what the CEO of Sears Roebuck said about that company's period of greatest growth. A former military man, General Robert E. Wood commented, “Business is like war in one respect—if its grand strategy is correct, any number of tactical errors can be made, and yet the enterprise proves successful.”3
Marketing is the higher strategy. Let's look at an example.
Example: Good Tactics, Bad Strategy
Promoted back in 2001, the XFL football league lasted only a single season. Yet, the guy who thought it up had the experience, know-how, and past success to present a seemingly sure thing. This was Vince McMahon, chairman of the World Wrestling Federation. The idea was to combine the sport of football with pure spectacle, as wrestling had been combined with spectacle sixty years earlier. McMahon convinced everyone, including NBC, which was a co-sponsor, that he could duplicate the model of professional wrestling with football and attain equal success.
McMahon's strategy was to offer this spectacle football as “offseason football,” an additional advantage being that it would not compete with games played during the regular NFL season. He calculated that it would attract football fans still hungry for the game's action after the regular season was over. And what football it would be! Football as it was never seen or imagined before. But he used the wrong strategy.
The problem was that McMahon's strategy was wrong for the market segment, which was far from identical to the one for wrestling audiences. In fact, from the beginning some complained of the “wrestling feel,” which was probably intended as part of the strategy.4 Of course, McMahon was ridiculed by mainstream sports journalists, owing to the “fake” stigma suffered by professional wrestling. However, he expected that, and thought that if anything the “fake” label would add to XFL's appeal. Even the catchy three letters supported this approach.
Most of McMahon's tactics were actually pretty good. These included good TV coverage (don't forget that NBC was a partner). Then there was the wide-open nature of the football that would be played in the XFL. Football fans relish the hard hits and collisions that define the sport. Yet football injuries have been a concern since the inception of the sport. Even the helmet has been improved to provide additional protection, and strict rules exist against unnecessary roughness. But not in the XFL. There were no penalties for roughness, and there were fewer rules in general. The less strict format was intended to spice things up and contribute to the spectacle: sort of Roman gladiators reborn in modern team competition. The franchises carried names such as Hitmen, Outlaws, and Rage.5 Only the thumbs-up or thumbs-down of an emperor was missing—and some say that McMahon even thought about this as a possibility.
The players gave it their all, going above and beyond the call of duty. They weren't just a bunch of average Joes hoping to catch on in a professional sports league; many were skilled enough to play in the NFL. And I'm sure the salespeople and those advertising and distributing the tickets did their best. But all of that is tactics. The strategy was to offer off-season football. But because the strategy was in error, the XFL failed.
Marketing as the Leadership Model
Now let's look at leadership and understand why Drucker asserted that it was “a marketing job.” On the face of it, marketing and leadership seem to have little in common. Even the basic development of the two differed greatly. Drucker saw the basic elements of leadership as having been thought through, tried, optimized, and documented in books and known by the ancients millennia ago. Drucker made an oft-repeated comment that the first systematic book on leadership was written by Xenophon 2,500 years ago, and that it was still “the best.” Xenophon was a historian and successful Grecian general.
In contrast to leadership, Drucker saw sales and marketing as relatively recent developments. He basically agreed with conventional accounts of the growth of sales, beginning at a time when the first merchants were able to sell a small number of homemade items. For example, think of books. They were originally prepared laboriously by scribes, who frequently spent more time recording the material on sheepskin than the originator did in conceiving the thoughts. A single error could cause the destruction of many weeks of work, since an entire page would need to be redone. To complete a single scroll might take a year or more. Each scroll was unique—there was no such thing as multiple exact copies of a work.
The ancient process was revolutionized in 1450 with the invention of movable type and the printing press, which made multiple copies of printed materials now possible. Further developments in printing and binding eventually enabled books to be available to almost everyone at relatively low cost. So while there was effective leadership in ancient times, there was little need for marketing.
Engineering and technology have been responsible for bringing new products to people's attention. As competition to produce these products increased, eventual overproduction created the need to get rid of this inventory. That's when sales became the issue—being able to sell the product that has been produced. But this, again, is sales, not marketing.
Drucker claimed that it was the Japanese in the seventeenth century who developed the concept of marketing. A merchant came to Tokyo with a revolutionary concept for selling goods. Previously, all selling was done by the manufacturers and farmers themselves, who made or grew what they sold. For the first time, this new merchant didn't sell a single class of goods. He sold all kinds of goods, mostly made by others. He was essentially a buying agent for what his customers wanted. Consequently, this retailer saw his task less as that of persuading others to purchase a product he already owned, and therefore must sell, and instead as that of discovering what his customers wanted and then getting them those products. A successful retailer had to research the market and have ready the products that consumers wanted, or he was soon out of business. This led to research into what the customers wanted and how much they were ready to pay, along with all the other aspects of marketing that have grown up since, including today's emphasis on the buyer and on societal responsibility. The basic idea behind marketing, then, is to have what the customer wants, rather than to try to sell what you have to unsuspecting customers.6
An interviewer asked one of the judges on American Idol about the overall decline in album sales while at the same time American Idol and its alumni had achieved such great success. “That's easy,” he said. “The recording studios have been trying to give the public what they think the public wants. We let the public decide, and then we give it to them.” The judge's statement reflects pure marketing!
Leadership as an Expression of Marketing
Now let's look at why Drucker asserted that leadership was “a marketing job.” On the face of it, marketing and leadership seem to have little in common. Even the basic development of the two fields differs greatly.
Again, Drucker saw the elements of leadership as qualities determined by the ancients millennia ago and optimized over time.
In this view, Drucker stated that it is the leader who is primarily responsible for the organization's future. Therefore, the leader must begin with a mission that he believes in and that is believable to and desired by those he leads. That is a strategic goal. Making the mission believable and communicating and promoting that mission is not only a priority but also a continual process. The leader never ceases to develop and implement the strategies through the use of tactics to reach the goals and objectives that will achieve the organization's mission. That's the nature and process of leadership. And as Peter Drucker concluded in his book regarding our challenges in the new century, that is also the process of marketing. Therefore, leadership is a marketing job.