Uncommon Sense, Common Nonsense by Jules Goddard

Uncommon Sense, Common Nonsense by Jules Goddard

Author:Jules Goddard
Language: eng
Format: epub
Publisher: Profile Books Ltd
Published: 2013-03-25T16:00:00+00:00


Six global forces are reducing the need for management

“Battered by new sources of competition and new demands from customers, bombarded by investors, bemused and undermined by technology, buffeted by ideologies like empowerment that challenge the assumptions of hierarchy and control and beleaguered by recent academic attacks on head offices and other central overheads, the structure and behaviour of large corporations appear to be anachronistic and overdue for change.” Richard Koch and Ian Godden

JUST AS FEUDAL SOCIETIES ultimately fell into disrepair and disrepute because they failed to keep pace with changing human aspirations and values, so the managerial model of organisational life is in danger of becoming just as obsolete. Six particular forces are alive today that are challenging both the legitimacy of managerial power and the wisdom of managerial elites:

Customer-centricity. Making the customer the focus of every activity within the firm has the effect of dramatically reducing the need for administrative overheads. Judged against the criterion of customer value, most managerial activity is wasteful and self-indulgent. As the firm is turned through 90 degrees, from “vertically” serving the boss to “horizontally” serving the customer, large swathes of activity lose their validity. In particular, managers who are simply managing other managers are “found out”.

Information technology. As customers, shareholders and operatives become increasingly well-informed, the management structures connecting them become decreasingly necessary. Most managers, particularly middle managers, owe their jobs to having privileged access to data. Because well-designed, distributed IT systems remove this privilege, they have been able to reduce dramatically the number of management jobs, effectively disintermediating most managerial work. IT empowers “doers”, owners and customers at the expense of managers.

Shareholder pressures. With the stronger assertion of investor power and the trend towards shareholder metrics, various devices have been used to align managers (“the agents”) with the interests of the owners (“the principals”). As the pressures to perform mount, and as the performance of managers becomes increasingly transparent, fewer and fewer managers are found to add economic value.

Global competition. The power of investors and customers to exert cost and quality pressures on companies is hugely strengthened by free trade, deregulation and global competition. National economies, domestic-market leaders and geographical cartels can no longer escape the leanest or most reputable producer, wherever they happen to be located in the world. As Richard Koch, an entrepreneur and writer, puts it, “The ideology of capitalism has shifted from cost-plus to price-minus.” Management is invariably the sacrificial victim.

Economies of simplicity. Growth has long been the touchstone of most corporate strategies, the assumption being that scale creates greater cost economies and a more defendable advantage than any other factor. But with scale comes complexity in the form of proliferating products, fragmenting markets, matrix organisations, burgeoning transaction costs and a superstructure of co-ordinators, planners and head-office executives. The truth is dawning that economies of simplicity are a surer recipe for success than scale and scope, mainly because fewer managers are needed.

Faith in leaders. In the 21st century, MBA graduates aspire to become change agents, or coaches, or leaders rather than managers.



Download



Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.