A story in December’s Harvard Business Review was heartening in its initial impact, but depressing upon reflection. The article ‘To Be a Better Leader, Give Up Authority’[i] reported on how two large manufacturers had improved results by giving up a dictatorial, cost-measurement approach to management in favour of empowered teams. It was heartening because it illustrates the power of this enlightened approach, but depressing because this knowledge has been around for at least half a century. To see it presented as a ‘new’ breakthrough after all this time begs some serious questions.
Why is it that, in management, we keep finding ourselves having to reinvent good practice, before managers relapse and implement failed hierarchical, mechanistic or cynical models such as Business Process Re-engineering?
I am a management writer. I write management books. In the course of 10 years or so of writing such tomes, I have come across not hundreds but thousands of books, reports and learned articles on the subject, nearly all coming to the same broad conclusion as mine. The conclusion is this: the creation of workplaces with high levels of commitment and enthusiasm, and promising career options for the staff, strong teams and communication, out-perform more exploitative companies in pure business terms. Making the workplace miserable does not maximise profits, other than perhaps in deliberately cruel trades like the sex industry.
Yet all our carefully chosen words and thorough research may count for less than we hope. Because there is a puzzle at the heart of management, and it is this: to a considerable extent, it is not based on what managers themselves have discovered about what works. It’s not like medicine, engineering or painting, where one learns from the finest exponents or from clear evidence of what is effective. One of my more learned contemporaries in the field of management writing, Jeffrey Pfeffer, commented in his work The Human Equation a few years ago that something ‘very strange’ was occurring in organisational management. While numerous studies have demonstrated the enormous economic returns obtained through the implementation of enlightened, participative management practices, ‘trends in actual management practice are, in many instances, moving in a direction exactly opposite to what this growing body of evidence prescribes,’ he noted[ii].
Professor Pfeffer has found that pretending that people behave like ‘resources’, obsession with quarterly financial reports, thoughtless cost-cutting, gratuitous reorganisational tinkering are preferred by most executives to the time-consuming task of making teams of people work more effectively; and above all to the horrifying concept of creating workplaces that are suitably humane and habitable for sane human beings to spend the greater part of their waking hours. The cult of recent decades has been to pretend that people aren’t people – it’s even written in to the jargon: ‘human resources’; and that endlessly restructuring our public and private sector institutions, in the mindlessly mechanical approach that flows from this, ‘improves efficiency’.
If management is not influenced by management research; what on earth is it influenced by? Why this eccentric mix of cynical folklore and bean-counting as the guide to running our great institutions? This engendering of collective misery that is, it turns out, largely gratuitous?
I have become increasingly convinced that some of the most powerful influences upon the way in which managers go about their craft are extra-curricular. We interpret and understand the world through stories; we grow up absorbing stories – either consciously, in the history and literature lessons at school, or sub-consciously, through the messages and anecdotes we hear from parents and others.
Normally, when researching for a management book, I will read academic works, and interview managers about their working lives. For my most recent work, Meet the New Boss[iii], I decided to look more broadly at how themes and stories about work and careers are conveyed to us in our leisure time.
I have discovered that there are plenty of books that propagate the notion that treating workers as a cost and a nuisance is the way to maximise profits. They are long established in Western culture, are widely read, and have wide influence. It transpires that those of us who write management books have a rival literature – literature. Charles Dickens and John Steinbeck have probably had more influence on how managers go about their craft than Professor Pfeffer. And far more than myself.
Let’s consider Ebenezer Scrooge from Dickens’ A Christmas Carol; his counting house and his one employee. Let’s make a people and business risk assessment (something that very few employers do to any comprehensive extent).
Just how advisable would it be for a Scrooge, under any economic circumstance, to treat such a diligent, incorruptible and effective worker as Bob Cratchit quite so badly? The most cursory risk assessment would rapidly conclude that Mr Cratchit was highly likely to seek employment elsewhere, and that there would be no guarantee at all of finding a replacement of similar calibre. His first duty was to his large family, including a disabled son, not to Mr Scrooge. Only if unemployment were very high would such a people strategy be even feasible, never mind sensible.
The little scene at the start of A Christmas Carol, with Scrooge in his counting house and Cratchit in his frozen office, is a perfect microcosm of the priorities, structure and operating assumptions of the typical business: the pretence that employee welfare matters only to the employee and is a net cost to the business; the emphasis upon accountancy, rather than understanding the business; the ignorance of the links between employee engagement and business performance; the neglect of the risk of loss of talent through indifferent management and poor leadership.
If management were guided primarily by evidence, the approach of enlightened employers such as Southwest Airlines, Nationwide Building Society, WL Gore and others would be the norm, not the exception. Do the others sub-consciously imitate Ebenezer Scrooge, rather than the latest findings from Harvard Business Review?
Blog: http://felipewh.wordpress.com
www.humancapitalforum.com
[i] http://hbr.org/2009/12/to-be-a-better-leader-give-up-authority/ar/1
[ii] The Human Equation, Pfeffer J, Harvard Business Press, 1998
[iii] Meet the New Boss is available as an e-book only, from www.whiteleywords.com