What do you think?
Rate this book
Concept of the Corporation
Concept of the Corporation was the first study ever of the constitution, structure, and internal dynamics of a major business enterprise. Basing his work on a two-year analysis of the company done during the closing years of World War II, Drucker looks at the General Motors managerial organization from within. He tries to understand what makes the company work so effectively, what its core principles are, and how they contribute to its successes. The themes this volume addresses go far beyond the business corporation, into a consideration of the dynamics of the so-called corporate state itself. When the book initially appeared, General Motors managers rejected it as unfairly critical and antibusiness. Yet, the GM concept of the corporation and its principles of organization later became models for organizations worldwide. Not only businesses, but also government agencies, research laboratories, hospitals, and universities have found in Concept of the Corporation a basis for effective organization and management. Because it offers a fundamental theory of corporate goals, this book is a valuable resource for business professionals and organization analysts. It will also be of interest to students and professionals in economics, public administration, and political science. Professional and technical readers who admire Peter Drucker's work will want to be certain this volume is in their personal library. At a time when everything from the size to the structure of corporations is being questioned, this classic should prove a valuable guide.
360 pages, Paperback
First published January 1, 1946
15 people are currently reading
722 people want to read
About the author
Peter F. Drucker
581 books1,988 followersPeter Ferdinand Drucker was a writer, management consultant and university professor. His writing focused on management-related literature. Peter Drucker made famous the term knowledge worker and is thought to have unknowingly ushered in the knowledge economy, which effectively challenges Karl Marx's world-view of the political economy. George Orwell credits Peter Drucker as one of the only writers to predict the German-Soviet Pact of 1939.
The son of a high level civil servant in the Habsburg empire, Drucker was born in the chocolate capital of Austria, in a small village named Kaasgraben (now a suburb of Vienna, part of the 19th district, Döbling). Following the defeat of Austria-Hungary in World War I, there were few opportunities for employment in Vienna so after finishing school he went to Germany, first working in banking and then in journalism. While in Germany, he earned a doctorate in International Law. The rise of Nazism forced him to leave Germany in 1933. After spending four years in London, in 1937 he moved permanently to the United States, where he became a university professor as well as a freelance writer and business guru. In 1943 he became a naturalized citizen of the United States. He taught at New York University as a Professor of Management from 1950 to 1971. From 1971 to his death he was the Clarke Professor of Social Science and Management at Claremont Graduate University.
The son of a high level civil servant in the Habsburg empire, Drucker was born in the chocolate capital of Austria, in a small village named Kaasgraben (now a suburb of Vienna, part of the 19th district, Döbling). Following the defeat of Austria-Hungary in World War I, there were few opportunities for employment in Vienna so after finishing school he went to Germany, first working in banking and then in journalism. While in Germany, he earned a doctorate in International Law. The rise of Nazism forced him to leave Germany in 1933. After spending four years in London, in 1937 he moved permanently to the United States, where he became a university professor as well as a freelance writer and business guru. In 1943 he became a naturalized citizen of the United States. He taught at New York University as a Professor of Management from 1950 to 1971. From 1971 to his death he was the Clarke Professor of Social Science and Management at Claremont Graduate University.
Ratings & Reviews
Friends & Following
Create a free account to discover what your friends think of this book!
Community Reviews
Displaying 1 - 14 of 14 reviews
November 9, 2017
I really wasn't expecting to like this book. Drucker is someone people just love to quote to prove just about any point. I was really surprised, over 70 years later, how much this spoke to me about business now.
April 21, 2023
While this is a great tome on business management (which Peter Drucker book isn't?), though it's not *the greatest one ever* -- that award belongs to the very dry, and perhaps hard to stay awake through it all My Years with General Motors by Alfred P. Sloan. It's an occasional cure for insomnia but it's also the best-written anatomy of a management structure for growth and value sustainability.
Drucker writes this book as almost a pre-narrative to that book, so I'd recommend reading this one back-to-back with that one for the full effect. Again, Sloan's book is dry.. reading the phone book could be a little more exciting; however, it offers a much more detailed look into one of the world's biggest corporations (GM) managed and grew during the 1910s-1960s, which saw car sales explode. Watching companies who are investing in technologies, whether it be AI or EVs, these markets may also explode and the format by which Sloan built the management structure with a common core and a committee-based system had been the recipe for a very successful GM.
On the other hand, Drucker's book is more academia in a way - on how or why the theory works. But coupled together, one gets an excellent sense of a management technique often overlooked in MBA schools: vertical management structures and how to build engines of growth and innovation. It's covered between this book and Sloan's, despite Drucker's insistence that they didn't care for one another.
Drucker writes this book as almost a pre-narrative to that book, so I'd recommend reading this one back-to-back with that one for the full effect. Again, Sloan's book is dry.. reading the phone book could be a little more exciting; however, it offers a much more detailed look into one of the world's biggest corporations (GM) managed and grew during the 1910s-1960s, which saw car sales explode. Watching companies who are investing in technologies, whether it be AI or EVs, these markets may also explode and the format by which Sloan built the management structure with a common core and a committee-based system had been the recipe for a very successful GM.
On the other hand, Drucker's book is more academia in a way - on how or why the theory works. But coupled together, one gets an excellent sense of a management technique often overlooked in MBA schools: vertical management structures and how to build engines of growth and innovation. It's covered between this book and Sloan's, despite Drucker's insistence that they didn't care for one another.
November 26, 2025
the wild Amazone
Interesting...
6/10
This is worth reading to understand how Peter Drucker's thoughts developed early in his career. The review by George Overton, written in 1947, before Drucker became an icon is spot on:
"Here is the anatomy of an institution laid out in 290 pages of erratic text, un-pleasant style, and often unfathomable prose. But with patience in reading, one learns that a social scientist has analyzed a dominant institution of our time in terms of its relations to human beings instead of its relation to other institutions."
/////
Historically Very Important - Still Relevant, Parts Outdated
8/10
This book has had a tremendous impact on management thinking and practice worldwide. As the first book to take an analytical study of a business corporation (GM) from the inside, many consider it to be the catalyst of the management boom that followed. It is certainly the first book to examine the business corporation as a social structure that brings together human beings for economic and social needs.
The book is also a sort of bridge from Drucker's more political and social writings in "The End of Economic Man" and "The Future of Industrial Man" to his later more managerial writings. It is credited with having established management of organizations as a discipline and a distinct field of study. However, as a book originally published in 1946, is it still relevent and worth reading today? Yes, but not for everyone.
Drucker raised many new issues and concepts basic to organizations. For example, he touched upon: dignity and status of the worker, corporate purpose, corporate contribution to and harmonization with community, management compensation and succession, worker training and development, workers as resources not costs, etc. Since new ideas will tend to seep into the popular consciousness over time, many of the ideas he introduced have long since become popularized and accepted (e.g. the benefits of decentralization, suggestion plans, and reengineering).
However, there are also a number the concepts which are not fully appreciated today or which we tend to just give lip service. For example, the basic concept of corporations as both economic and social institutions is still not fully appreciated or understood (neither by those on the "right" or the "left"). For me, the book was worth the read for these insights alone.
In summary, I very much recommend this book if you've read some of Drucker's other writings and are interested in reading Drucker's founding writings on the corporation as both an economic and social organization. One option you may want to consider is to skip Part II which mostly discusses GM decentralization as a model.
STRENGTHS: Great thinking and understanding from Drucker on corporations as social structures. First thorough analytical look at a business corporation from the inside. Important economic concepts explained too (e.g. monopoly, profit motive).
WEAKNESSES: Some parts are rambling and others more concise. Part II of the book (more specific to 1940s GM and decentralization) is more outdated. Never a graph or equation to help understanding.
WHO SHOULD READ THIS BOOK: Those interested in understanding corporations as both economic and social organizations.
Bradley A. Swope
Interesting...
6/10
This is worth reading to understand how Peter Drucker's thoughts developed early in his career. The review by George Overton, written in 1947, before Drucker became an icon is spot on:
"Here is the anatomy of an institution laid out in 290 pages of erratic text, un-pleasant style, and often unfathomable prose. But with patience in reading, one learns that a social scientist has analyzed a dominant institution of our time in terms of its relations to human beings instead of its relation to other institutions."
/////
Historically Very Important - Still Relevant, Parts Outdated
8/10
This book has had a tremendous impact on management thinking and practice worldwide. As the first book to take an analytical study of a business corporation (GM) from the inside, many consider it to be the catalyst of the management boom that followed. It is certainly the first book to examine the business corporation as a social structure that brings together human beings for economic and social needs.
The book is also a sort of bridge from Drucker's more political and social writings in "The End of Economic Man" and "The Future of Industrial Man" to his later more managerial writings. It is credited with having established management of organizations as a discipline and a distinct field of study. However, as a book originally published in 1946, is it still relevent and worth reading today? Yes, but not for everyone.
Drucker raised many new issues and concepts basic to organizations. For example, he touched upon: dignity and status of the worker, corporate purpose, corporate contribution to and harmonization with community, management compensation and succession, worker training and development, workers as resources not costs, etc. Since new ideas will tend to seep into the popular consciousness over time, many of the ideas he introduced have long since become popularized and accepted (e.g. the benefits of decentralization, suggestion plans, and reengineering).
However, there are also a number the concepts which are not fully appreciated today or which we tend to just give lip service. For example, the basic concept of corporations as both economic and social institutions is still not fully appreciated or understood (neither by those on the "right" or the "left"). For me, the book was worth the read for these insights alone.
In summary, I very much recommend this book if you've read some of Drucker's other writings and are interested in reading Drucker's founding writings on the corporation as both an economic and social organization. One option you may want to consider is to skip Part II which mostly discusses GM decentralization as a model.
STRENGTHS: Great thinking and understanding from Drucker on corporations as social structures. First thorough analytical look at a business corporation from the inside. Important economic concepts explained too (e.g. monopoly, profit motive).
WEAKNESSES: Some parts are rambling and others more concise. Part II of the book (more specific to 1940s GM and decentralization) is more outdated. Never a graph or equation to help understanding.
WHO SHOULD READ THIS BOOK: Those interested in understanding corporations as both economic and social organizations.
Bradley A. Swope
May 23, 2020
Drucker shines in his analysis of the minutiae of human organization, and how such decisions impact us on a level that is social and humane.
Part 1 provides necessary context of the ideals of the majority of the nation in that time period, which he writes to satiate.
Part 2 will be most useful to the business student, describing decentralization as a framework of human organization. He specifies this in the detail of General Motors’ organizational structure, and goes on to argue with well researched evidence that this is the most efficient form of productive organization. He also provides a general set of values suggested to apply the concept of decentralization to other businesses.
Part 3, in my opinion, is the best part of the book. Drucker discusses each member of the organization and the ways in which the system both serves and fails them. With the nuance of a trained businessman he interrogates the reasons why, evaluates the success of the corporation from a social perspective, and ponders the ways in which the corporate system can be adjusted to best serve its members. It is a skilled melding of the big picture and small picture.
Part 4 is the weakest. In an attempt to use his findings to find a moral argument for the existence of the free market, he accidentally dives into a field of political theory for which he is unprepared. His arguments rest on assumptions that are never addressed or defended, and he ignores a good deal of historical political thought. It is far too broad a subject to devote one chapter of a book which is primarily about something else. Drucker’s argument in this part is an early basis of what we can now understand as neoliberalism, but lacks the fully formulated ideology to make a rational argument.
Excepting the last chapter in which he strays into unknown territory an extremely well thought out and worthwhile read. A little dated at times, but surprisingly fresh at others. Great observational evidence of the forces of industrial capitalism.
Part 1 provides necessary context of the ideals of the majority of the nation in that time period, which he writes to satiate.
Part 2 will be most useful to the business student, describing decentralization as a framework of human organization. He specifies this in the detail of General Motors’ organizational structure, and goes on to argue with well researched evidence that this is the most efficient form of productive organization. He also provides a general set of values suggested to apply the concept of decentralization to other businesses.
Part 3, in my opinion, is the best part of the book. Drucker discusses each member of the organization and the ways in which the system both serves and fails them. With the nuance of a trained businessman he interrogates the reasons why, evaluates the success of the corporation from a social perspective, and ponders the ways in which the corporate system can be adjusted to best serve its members. It is a skilled melding of the big picture and small picture.
Part 4 is the weakest. In an attempt to use his findings to find a moral argument for the existence of the free market, he accidentally dives into a field of political theory for which he is unprepared. His arguments rest on assumptions that are never addressed or defended, and he ignores a good deal of historical political thought. It is far too broad a subject to devote one chapter of a book which is primarily about something else. Drucker’s argument in this part is an early basis of what we can now understand as neoliberalism, but lacks the fully formulated ideology to make a rational argument.
Excepting the last chapter in which he strays into unknown territory an extremely well thought out and worthwhile read. A little dated at times, but surprisingly fresh at others. Great observational evidence of the forces of industrial capitalism.
July 30, 2025
I first read "Concept of the Corporation" back in the seventies when I was starting my career. At the time, I was primarily interested in learning how successful companies worked. Frankly, for that I found Alfred Sloan's "My Years with General Motors" more informative and interesting reading. But later I read Drucker's "Management: Tasks, Responsibilities, Practices" and made that book my management bible.
Recently, I reread "Concept of the Corporation" and this time better understood the major issues Drucker was writing about. The book has two primary themes: (1) an analysis of the decentralized business model as General Motors pioneered it starting in the 1920s, and (2) more relevant today, a discussion of the role of the corporation in society.
Even in 1946, Drucker claimed corporations have a much broader responsibility than simply maximizing profits for shareholders as economist Milton Friedman popularized starting in the early 1960s. Drucker wrote that a corporation is more than an economic entity—it has a critical social function. Corporations must serve the interests of multiple stakeholders: not just shareholders, but also employees, customers, and the wider community.
Today, Drucker's view of the corporation as he first wrote in "Concept of the Corporation" has largely been replaced by Friedman's view of profits above all else (so long as no laws are broken.) Friedman’s philosophy has provided justification, for example, to social media companies to largely ignore the impact of disinformation on society so long as profits grow, and shareholders are happy.
But, in my opinion, Drucker’s view of the corporation’s role in society will ultimately prevail. And there are few better summaries of that responsibility than Drucker’s Section III: The Corporation as a Social Institution as he wrote in “Concept of the Corporation.” That section alone is worth reading carefully as we citizens consider the effect Big Business—media, pharmaceuticals, defense, etc.—has on our society.
Recently, I reread "Concept of the Corporation" and this time better understood the major issues Drucker was writing about. The book has two primary themes: (1) an analysis of the decentralized business model as General Motors pioneered it starting in the 1920s, and (2) more relevant today, a discussion of the role of the corporation in society.
Even in 1946, Drucker claimed corporations have a much broader responsibility than simply maximizing profits for shareholders as economist Milton Friedman popularized starting in the early 1960s. Drucker wrote that a corporation is more than an economic entity—it has a critical social function. Corporations must serve the interests of multiple stakeholders: not just shareholders, but also employees, customers, and the wider community.
Today, Drucker's view of the corporation as he first wrote in "Concept of the Corporation" has largely been replaced by Friedman's view of profits above all else (so long as no laws are broken.) Friedman’s philosophy has provided justification, for example, to social media companies to largely ignore the impact of disinformation on society so long as profits grow, and shareholders are happy.
But, in my opinion, Drucker’s view of the corporation’s role in society will ultimately prevail. And there are few better summaries of that responsibility than Drucker’s Section III: The Corporation as a Social Institution as he wrote in “Concept of the Corporation.” That section alone is worth reading carefully as we citizens consider the effect Big Business—media, pharmaceuticals, defense, etc.—has on our society.
December 24, 2020
It’s almost eerie to read insightful critiques of big business written 70 and 50 years ago. Drucker’s commentary is artful, candid, deeply informed, and instructive—but far less so now than it was in the past.
Serious rumination about the role of the corporation is less in vogue now than it was two generations ago, much to our detriment.
Drucker was too early to feel the ill wind that blows when the corporation imposes its awesome power on its employees and society as a whole.
Concept of the Corporation is an historical gem, but it doesn’t touch the hot nerves that drive the destructive role that big business has created for itself.
Read more of my book reviews and poems here:
www.richardsubber.com
Serious rumination about the role of the corporation is less in vogue now than it was two generations ago, much to our detriment.
Drucker was too early to feel the ill wind that blows when the corporation imposes its awesome power on its employees and society as a whole.
Concept of the Corporation is an historical gem, but it doesn’t touch the hot nerves that drive the destructive role that big business has created for itself.
Read more of my book reviews and poems here:
www.richardsubber.com
May 30, 2019
I like most who possess interest in management have come across the name Peter Drucker, more often than not revered as the authority on the topic.
This openly expressed fervent places enormous scrutiny on any works that the subject offers.
Peter Drucker does not disappoint with this title.
In my view, this book is fantastic, mind-blowing & incredibly progressive even in comparison to generally accepted management convention for today.
Drucker's ideas themselves are to be held with the reverence they are; stating that all one may achieve via policy is the right questions never the right answers... BRILLIANT!
This openly expressed fervent places enormous scrutiny on any works that the subject offers.
Peter Drucker does not disappoint with this title.
In my view, this book is fantastic, mind-blowing & incredibly progressive even in comparison to generally accepted management convention for today.
Drucker's ideas themselves are to be held with the reverence they are; stating that all one may achieve via policy is the right questions never the right answers... BRILLIANT!
Read
May 9, 2020As a sociologist, Drucker provided more interesting insights than similar management books. Having front-line workers to hold the same power as managers, was a crucial paradigm shift from Fordian scientific management, considering the time this was proposed. We can see it's effect not only in manufacturing industries but also its expansion to service and tech. Another important aspect is the pursue of a goal greater than an individual, such as cooperate's value and even nationalism. Clearly front-line workers are not as patriotic as the past, it's more interesting to shift into some greater goal as climate change or equity.
July 11, 2024
I personally enjoyed this book, but I don’t know if I can recommend it unless you’re interested in management or war-time production. This book is very philosophical, so even those interested in said topics might find this to be a tough read. I remain unconvinced that it’s to-date or worth the hours to read. If you really like this sort of history/economic philosophy, it might be worth your while.
March 12, 2025
I don't know why this book was on my to-read list, but I read it just to get it off of there. I don't know what I expected from an 80 year old book. Some stuff was highly relevant and obvious, probably because it's had 80 years for its ideas to disseminate. Other stuff was asserted and premises assumed with zero support or explanation. This may be useful as a historical curiosity, but all the important ideas are available in easier formats elsewhere.
March 29, 2021
就屬於，從此以後一言難盡的公司/工廠人身依附關係。
沒有封土封臣封建的自由人保護自由人的契約關係，卻要在傭兵工頭、寡頭那裡自己創建自己的歸屬感（工會還要付錢）。工人上班也不開心這件事，通用汽車當然不關心啦。
沒有封土封臣封建的自由人保護自由人的契約關係，卻要在傭兵工頭、寡頭那裡自己創建自己的歸屬感（工會還要付錢）。工人上班也不開心這件事，通用汽車當然不關心啦。
October 18, 2016
This book was written 70 years ago - and yet the concepts and recommendations of this book are just as relevant today. I thoroughly enjoyed reading this book and as part of our class work, it was the basis for a great discussion.
August 16, 2012
A book on General Motors in the 60s.
November 12, 2012
A good read!
Displaying 1 - 14 of 14 reviews