Why Leadership is a "Marketing Job"

One of Drucker’s far reaching and integrative ideas is actually little known. This idea is that good leadership is essentially marketing. People mistake this as recommending manipulation, and so it is widely ignored. But that’s not what he meant. The concept is based on Drucker’s view that all knowledge workers are partners in an organization. As partners, they could not simply be ordered around. They had to be led—and this involved not only persuasion, but strategic thinking and many other elements of marketing. Leadership, Drucker concluded, was a "marketing job."

Why Marketing Isn’t Selling

Note, again, that Drucker did not say that leadership was a "selling job." He said a "marketing job." This is an important difference. Drucker explained that the first had to do with persuading a prospect to buy a product you wanted to sell while marketing was about having a product a prospect sought to buy. According to Drucker, if marketing was done perfectly, selling would be unnecessary.

Drucker 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 before we look at why Drucker made this claim, let’s first look at marketing. Famed marketing professor Philip Kotler, who is often referred to as the "Father of Marketing" said, "If I am the Father of Marketing, then Drucker is the Grandfather of Marketing." And indeed, Drucker had a long history of exploring the mysteries of marketing, a subject that is second only to leadership in its apparent simplicity, yet difficulty in implementation. In his first book devoted to 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 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. Whatever Drucker believed about selling and marketing is well worth examining.

Drucker saw marketing as concerned with top level thinking, decision making and strategies. Below this were various means of carrying out these strategies: advertising, selling, pricing, distribution means, etc. Many refer to lesser strategies used in the implementation of bigger strategies. They call these "tactics." Strategies and tactics are not the same either. Strategy is far more important; in fact your tactics may be less than perfect, but if your strategy is the correct one, you can still be successful. At least that’s what the CEO of Sears Roebuck, former military man, General Robert E. Wood, said during its period of greatest growth. To quote him accurately, his comment was, "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." Marketing is the higher strategy.

You might remember the XFL football league, which lasted only one season back in 2001. The XFL itself was the brainchild of Vince McMahon, World’s Wrestling Federation Chairman. The idea was to combine the sport of football with pure spectacle, as had been done with wrestling. McMahon thought that he could duplicate the success that professional wrestling had enjoyed over the years. His basic strategy was to offer this new spectacle as "off-season football," saying that it would not compete with games conducted during the regular season. According to McMahon it would attract football fans hungry for football after the regular season was over. The problem was that the strategy was wrong. McMahon didn’t understand that the market segment he wanted to appeal to was entirely different from the one with which he was familiar.

McMahon was ridiculed by mainstream sports journalists because of the stigma attached to professional wrestling’s image of being "fake." Some sports journalists speculated, only half-jokingly, whether any of the league's games were rigged for one side or the other. For the same reason, regular football fans were unconvinced from the start. So much for the strategy; that is, so much for marketing. The tactics were pretty good. Good TV coverage including partner NBC, no penalties for roughness and fewer rules in general. This was intended to liven things up and contribute to the spectacle, almost like Roman gladiators reborn. The teams played their hearts out, and many of the players went on (or back) to the NFL once the league broke up. And presumably those on the sales end sold their hearts out. But those are all tactics. Despite excellent tactics, the XFL lasted only one season. Great tactics that were well-executed, but the strategy was in error. The XFL failed.

Marketing as a Leadership Model

Now let’s look at leadership and why Drucker thought 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’s made an oft-repeated comment that the first systematic book on leadership was written by Xenophon 2,000 years ago, and that it was still "the best." On the other hand he saw marketing as a relatively recent development. He basically agreed with the orthodox accounts that had merchants first in the position of being able to sell the few copies produced, for example of books, prepared laboriously by skilled scribes, frequently spending more time getting the material down on sheepskin than the author did in writing what was being reproduced. One error could cause the destruction of many weeks' work since an entire page would need to be redone. To complete a single book might take a year or more of labor by these trained specialists. These ancient processes were revolutionized by technology and the industrial revolution. The Gutenberg Press enabled books to be available to almost everyone at relatively low cost. So there was no marketing. This was basically an engineering and production issue. Then as more competition, which produced these products, entered the marketplace and overproduction created the need to get rid of inventory, it became a sales issue—being able to sell the product produced.

Drucker claimed that it was the Japanese who developed marketing in the 17th century. A merchant came to Tokyo with a revolutionary concept of selling. Previously, all selling was by the manufacturers themselves who made or grew what they sold. Drucker said that 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 of persuading others to purchase a product that he already owned and therefore must sell, but rather in discovering first what his customers wanted and then getting these desired products. A successful retailer had to research the market and have products that the consumer wanted first, or he was soon out of business. This led to research as to what his customers wanted and were ready to pay, along with all the other aspects of marketing that have grown up since, along with today’s emphasis on the buyer and societal welfare as a result of using the product. The basic idea was to have what the customer wanted rather than to try and sell what you had to an unsuspecting customer.

Watching an interview with one of the judges on American Idol, the judge was asked to comment on the decline in sales in the recording industry at the same time that American Idol and its alumni had reached 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 we then we give it to them." The latter is pure marketing!

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 the leader believes in and that is believable and desired by those he leads. Making this mission believable and communicating and promoting the mission is a continual process, so the leader must never cease to develop and implement the strategies and tactics to reach the goals and objectives that will achieve the organization’s mission. That’s marketing. And, as Drucker taught us, that is also leadership.