19.1. Innovation and the Maximization of Shareholder Value

Peter Drucker has been fascinated with innovation ever since he started writing books in the early fifties. He links it with entre-preneurship, which, he says, is neither a science nor an art. It is a practice—and innovation (or the knowledge that is the outcome of the innovation) is a means to an end. "Entrepreneurs innovate. Innovation is the specific instrument of entrepreneurship."

Which "end" is Drucker talking about? As a good Austrian economist, he links it up with Schumpeter's creative destruction. Through innovation, the entrepreneur creates a dynamic disequilibrium, which gives him opportunities and brings destruction to the others. Unfortunately, in this process not only the ...

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