The book is also nicely balanced, along a num-
ber of dimensions. The authors accept the impor-
tance of and draw from both theory and research;
both laboratory experiments and field surveys
are used. The book considers, in an even-handed
way: principles of respondent behavior and oper-
ant behavior; theories of reinforcement; verbal
behavior; thinking, problem solving and deci-
sion making; the behavior of individuals in
groups; and organizational leadership.
The authors are even-handed in another im-
portant wcry. They glean what should be gleaned
from the studies they describe, but do not give
the reader greater confidence than is warranted.
That is, the weaknesses and limitations of the
studies cited are noted, but always in a construc-
tive manner, so that the reader feels that he or
she has been mentored rather than forced to
participate m a critique for the sake of criticism.
The book earns high, but not perfect, marks in
two areas that are critical to the success of any
primer: defining terms before using them, and
illustrating these terms through the use of practi-
cal illustrations. In general, careful definitions
are offered before a technical term is employed
and although sometimes the authors get carried
away, murky definitions and esoteric content are
not frequent.
As mentioned, the authors draw nicely from
both laboratory and field research. This means
that they pay careful attention to what has been
learned from both rats and people. What still
cannot be said definitively—by the authors or
anyone else—is how confident we may be about
extrapolating from research on animals to funda-
mental truths about people. This is an age-old
controversy which will not benefit from regurgi-
tation here, but I'd like to offer a particular obser-
vation that caught my eye. One of the "truths"
gleaned from experiments on animals is that rein-
forcement should be administered "with mini-
mum delays" (p. 47), for reasons carefully spelled
out by the authors. Yet I find, for example, that a
compliment such as "that was a really good ques-
tion you asked at the meeting this morning,"
delivered in a subordinate's office several hours
after the meeting, is made more dramatic (and
172
more reinforcing) precisely because time has
passed than if the question at the meeting had
immediately been followed by "that's a really
good question." To the extent that this example
is sound, it raises issues that aren't addressed
very fully in the text.
I've argued that the book is comprehensive,
competent, and important. Nobody can argue
that it is sexy, mainly because the topic is so
complex (the authors point out five times in the
first four pages that human behavior is complex)
and partly because the authors do not want to
limit their intended audience:
This book is intended as a primary text for ad-
vanced undergraduate and graduate courses in
organizational behavior. However, we believe it
can serve equally well when used in conjunction
with other texts for such courses as organizational
psychology, organizational theory, organizational
development, and human resource manage-
ment, whether they are part of a graduate curric-
ulum or an executive development program (pp.
vii-viii).
In particular, I envisioned some difficulties in
using the text with executive trainees for stylistic
reasons: margins are very narrow and the book
was produced without color. More importantly,
pages 1-75, contain twelve figures whereas the
remaining 123 pages contain only one figure.
Finally, the writing is clear, but relatively formal.
I have inadvertently taken up more space
being critical than being complimentary, some-
thing often done in reviews about excellent
books, so let me end this review with the remark
that began it. The topic is important, the authors
highly credentialed, and the content accurate
and competently handled. This is an easy book
to recommend, and I unequivocally recommend
it to you.
Innovation and Entrepreneurship, by
Peter F. Drucker. New York: Harper &
Row, 1985, 277 pp., $19.95, cloth.
Reviewed by William B. Gartner, Georgetown
University, School of Business Administration,
Washington, DC.
I wrote the book because I felt the time had come
to be a little more serious about the topic than
most of the prevailing work was, and also in part
because, bluntly, most of the things you read or
hear seem to me, on the basis of 30 years of work
and experience, to be misunderstandings. The
entrepreneur—the person with George Gilder's
entrepreneurial personality—yes, there are such
people, but they are rarely successful. On the
other hand, people whom Gilder would never
accept as entrepreneurs are often very successful.
Entrepreneurship is not a romantic subject. It's
hard work. I wanted to dislodge the nineteenth-
century folklore that holds that entrepreneurship
is all about small business and new business.
Entrepreneurs range from the likes of Citibank,
whom nobody has accused of being new or
small—or General Electric Credit—to Edward D.
Jones & Co. in St. Louis, the fastest-growing Ameri-
can financial services company.
But there's another reason. When I published
Ptactice of Management 30 years ago, that book
made it possible for people to learn how to man-
age, something that up to then only a few geniuses
seemed able to do and nobody could replicate it.
I sat down and made a discipline of it. This book
does the same with innovation and entrepreneur-
ship (Drucker, 1985, p. 46).
In these direct and candid remarks from an
nterview conducted shortly after the publication
:>i Innovation and Entrepreneurship, Peter opportunities
Drucker admirably addresses the Zeitgeist on
nnovation and entrepreneurship and summa-
rizes the thrust of his book. It is the sweep of his
/ision and the authority of his tone that are
mpressive—both in these remarks and in the
Dook itself. For individuals with a solid working
aiowledge of the strategic management and
sntrepreneurship literature, Drucker's book will
De more a triumph of form than substance.
Drucker acknowledges that Kanter (1983), Porter
1980), and Vesper (1980) provided far greater
iepth and breadth on the subjects of innovation,
strategy, and entrepreneurship, but the tone and
orientation of Drucker's book and Drucker's sta-
;us as one of the major (if not the major) writers
n management make this book a significant con-
:ribution to the field.
From the beginning, Drucker seeks to dispel
he idea that the entrepreneur is entrepreneur-
ship. "[The book] does not talk of the psychology
173
and character traits of entrepreneurs; it talks of
their actions and behaviors" (p. vii). He says that
innovation and entrepreneurship can no longer
be seen as the domain of a gifted few with spe-
cial personality characteristics. Seeing the entre-
preneur in terms of practice rather than as a
personality is the key premise of the book and
represents a major shift in how we view entre-
preneurship. Drucker sets out to identify the prac-
tices of innovation and entrepreneurship and to
explain why these practices should be a neces-
sary part of an organization's, and an individ-
ual's, repertoire of behaviors.
The book is divided into three parts. In Part I,
Drucker identifies innovation as the key attribute
of entrepreneurial behavior. Drucker points out
that all organizations face constantly changing
environments. Organizations that survive are
those that can adapt through innovation. He
defines systematic innovation as the "purposeful
and organized search for changes, and the sys-
tematic analysis of the opportunities such
changes might offer for economic or social inno-
vation" (p. 35). Innovative organizations must
systematically monitor seven sources of change,
which Drucker identifies as areas from which
arise for innovative firms. Change
arises in the following ways: (a) the unex-
pected—unexpected success, failure, or outside
events; (b) incongruity—differences between how
the world actually is and how the world is as-
sumed to be; (c) a process need—a better way to
do something; (d) unforeseen changes in an
industry or market structure; (e) demographics—
population changes; (f) changes in perception,
mood, and meaning; and (g) new knowledge. A
chapter is devoted to each of t"hese sources of
change and each source is elaborated through
several stories. The lessons in these seven chap-
ters are not a set of rules about innovative
behavior, rather they are ways of seeing how to
behave. Drucker's stories provide us with the
means to see our own experiences in new ways,
which is itself at the root of innovation.
Drucker does suggest some principles of inno-
vation, such as: "An innovation, to be effective,
has to be simple and it has to be focused" (p. 135)
and "Don't diversify, don't splinter, don't try to
do too many things at once" (p. 136). While
Drucker admits that these principles are state-
ments of the obvious, his mission is to make us
aware that those successful obvious alternatives
and actions often escape our attention.
Part II analyzes the practice of entrepreneur-
ship in three types of businesses: existing, public-
service, and new ventures. In new ventures, for
example, Drucker suggests that the new organi-
zation focus on management, rather than entre-
preneurship. He posits that a focus on manage-
ment will require the new organization to: (a)
focus on the market, (b) plan ahead for future
financial needs, (c) build a top management
team before it actually needs or can afford one,
and (d) ask the founders to evaluate their
strengths and abilities in light of the changing
needs of the growing organization.
In Part IE, Drucker discusses four entrepreneur-
ial strategies which exploit changes in the mar-
ketplace: (a) being "fustest with the mostest"; (b)
"hitting them where they ain't"; (c) finding the
ecological niche; and (d) changing the economic
characteristics of the product or market. These
strategies provide additional images of how inno-
vative companies behave. In the chapter enti-
tled "Hit Them Where They Ain't," for example,
Drucker posits two methods, creative imitation
and entrepreneurial judo. In creative imitation
(a term developed by Theodore Levitt) the strat-
egy IS to wait until others have established the
new, but only approximately, then to develop a
product that more closely meets the needs of the
customer. Drucker uses IBM's introduction of the
personal computer and Johnson and Johnson's
introduction of Tylenol as illustrations of how
companies improved on existing products (Apple
computers and aspirin), thereby capturing a sig-
nificant share of the market. In entrepreneurial
judo, the strategy is to enter an industry which is
carelessly defended because of competitive hab-
its that were successful in the past. Successful
organizations often become complacent and take
customers for granted, leaving openings for
entrants that can develop innovative products.
174
Sony's introduction of the transistor radio in ^
marketplace grown complacent because of th
perceived quality of vacuum tubes and ROLM'
introduction of digital PBX systems in market
long dominated by the Bell System are two c
the examples which Drucker provides to describ
entrepreneurial judo. Both creative imitation an(
entrepreneurial judo are market-focused am
market-driven with the objective of achieving (
leadership position in the marketplace.
Innovation and Entrepreneurship piques tb
interest and imagination of the reader interestei
in how organizations might successfully adap
to changing environments. Whether Drucker ha
been successful in creating a discipline of entre
preneurship is subject to interpretation. Drucke
is successful in redirecting the focus of interes
from the entrepreneurial personality to the prac
tice of entrepreneurship. This may be the firs
book on entrepreneurship that does not discus
the entrepreneur. He never resorts to "explain
ing" entrepreneurship with personality charac
teristics of the entrepreneur. I hope that the boo!
will provide additional impetus for scholars ii
entrepreneurship to ask: What do entrepreneur
do? and to design appropriate methodologies t(
explore this question.
One problem with the book that often crops uj
when innovation and entrepreneurship are dis
cussed is the distinction between innovation anc
entrepreneurship that is constantly obscured anc
these words often were used interchangeably,
believe entrepreneurship and innovation ar;
different. From Drucker's perspective, entrepre
neurial activities also must be innovative. Fo
example, in his first attempt at defining entrepre
neurship, he suggests that "not every new smal
business is entrepreneurial . . . " (p. 21). He con
siders only businesses that introduce an innova
tion (e.g., McDonald's) to be entrepreneurial.
I suggest that entrepreneurship be defined ai
"organization creation" (Gartner, 1985; Vesper
1980) whether the new organization is innova
tive or not; and innovation should be defined a
activities which apply the "new," (new being an;
new process, product, technology, idea, etc.
Tomatzky, et al., 1983). Given these definitions,
entiepreneurship (organization creation) is a
solution to those situations which need organiz-
ing, while innovation is a solution to those situa-
tions that need something new. From my per-
spective, Drucker's book is primarily about inno-
vation rather than entrepreneurship.
One might fault the book for its generalities
and for the lack of specific steps to take for entre-
preneurial action, but Drucker's writings have
always been guides rather than how-to manuals.
Drucker's contribution provides us with a new
way to see entrepreneurship; it does not map
out all the details. To see entrepreneurship as a
practice provides us with a much wider horizon
for exploration of a territory that we are just
beginning to address. I think that Drucker sets us
off in the right direction.
References
Drucker, P. (1985) The entrepreneurial mystique. Inc. 7(10),
34-58.
Gartner, W. B. (1985) A conceptual framework for describing
the phenonmenon of new venture creation. Academy of
Management Review, 10, 696-706.
Kanter, R. M. (1983) The change masters. New York: Simon
& Schuster.
Porter, M. E. (1980) Competitive strategy. New York: Free
Press.
Tomatzky,L. G., Eveland, J. D., Boyland, M. G., Hetzner,
W. A. , Johnson, E. C. , Roitman, D., & Schneider, J. (1983)
The process of technological innovation: Reviewing the
literature. Washington, DC: National Science Foundation.
Vesper, K. H. (1980) New venture sfra/egies. Englewood Cliffs,
NI: Prentice-Hall.
U.S. Coal Goes Abroad: A Social Action
Perspective on Interorganizational Net-
works, by Kathr/n S. Rogers. New York:
Praeger Publishers Division of Green-
wood Press, Inc., 1986, 253 pp., $38.95,
cloth.
Reviewed by James E. Post, School of Manage-
ment, Boston University, Boston, MA.
175
If the corporation has become the central social
institution of our age (Mason, 1986), it must also
be acknowledged that modern corporations are
increasingly evolving toward socioeconomic and
sociopolitical networks that magnify the impact
they have on all facets of social life. One result is
larger, more complex, polycentric networks of
organizations (Gerlach & Palmer, 1981) that defy
simple theoretical and empirical categorization.
Analyzing such networks is impeded by their
size and complexity, and ironically, the variety
of scholarly techniques and perspectives that can
be employed to study their structures, motiva-
tions, behavior, and effects.
We are fortunate to have a new system of
inquiry that facilitates a higher degree of concep-
tual and empirical analysis. Kathryn Rogers'
study of the coal industry is much more than an
examination of how a complex and threatened
industry responded to major environmental
change. It is a conceptual and methodological
work of note, because the author has found a
remarkably effective way to integrate multiple
research perspectives and a variety of units of
analysis into a coherent "social action" frame-
work. (This framework draws heavily from the
works of Oharles Perrow, 1979, and French soci-
ologist Lucien Karpik, 1978.)
The basic problems addressed by Rogers are:
how to conceptualize the interorganizational rela-
tionships that occur in a rapidly changing, so-
called turbulent setting, and how to explain or
causally model the behavior and structural ef-
fects that accompany these relationships. Opera-
tionally, this problem is refined into three ques-
tions: (a) What kinds of new interorganizational
patterns occured in an industry facing rapid
change? (b) What explains such patterns in terms
of current interorganizational theory? and (c)
What effects did the new patterns have on distri-
butions of power among industry (or network)
members, and what is socially significant about
this reorganization?
The situation that Rogers selected to study was
the United States coal industry. From early 1980
through the end of 1982, U.S. steam coal, used