Cisco Grows Smarter

In his most recent column for Bloomberg Businessweek, Rick Wartzman, Drucker Institute executive director, takes a deeper look at a subject we recently covered here: Cisco Systems’s recent decision to re-focus its business after being seduced and set back by the prospect of unremitting growth.

In his work, Peter Drucker often cautioned against growth for growth’s sake. “There are few exceptions to the rule that today’s growth company is tomorrow’s problem,” Drucker wrote in his 1973 classic, Management: Tasks, Responsibilities, Practices.

While he warned of the dangers of unchecked growth, Drucker wasn’t simply anti-growth. “Growth,” he wrote, “will continue to be a desirable and indeed a necessary business objective.” The key is to ensure that the growth is healthy. To achieve this, “a management needs a rational growth policy,” Drucker explained. “A management needs objectives that are based on more solid grounds than the desire to grow or the promise to grow.”