management is a mindset

January 25, 2016 0 comments

As human beings, we learn naturally from each other. This process starts when we are children, and continues throughout our adult lives. Particularly when faced with uncertainty or risk, we look around to see what others have done in the past and are doing now, what works, and what does not. This is as true of management and leadership as it is of every other human activity.

537-1There is a terribly fine line, though, between genuinely ‘learning’ from the examples of others, analyzing what they do and contextualizing this learning to suit our own situation, and simply imitating others in the hope and faith that what worked for them will work for us also. This leads to what psychologists call ‘herd behavior’, in which we blindly follow where others are going without thought for whether this is really the right thing to do. In management, this behavior leads to fads and trends that can sometimes do more harm than good.

Thinkers50 and other organizations like it—including magazines such as The Smart Manager—have the aim of promoting the best in management thinking, transmitting good ideas, and encouraging managers to learn from and absorb these ideas into their own work. I am all in favor of this. Much of my own writing and teaching over the past 20 years has been dedicated to the same end: searching for new and valuable ideas, then holding them up to the light so that others can see and assess them and, if they wish, adopt them.

But I and other writers like me must acknowledge a responsibility. We are not ‘telling people how to manage’. We are offering observations from what has gone before and what we see around us now, what seems to work, and importantly, what does not work. But we also must recognize that every organization is unique, every business situation is unique, and that managers and leaders have to find their own answers to the problems they face.

As writers and teachers, therefore, we are facilitators of learning and thinking, not purveyors of absolute truth. I tell my MBA students that there are few if any absolute truths in management, that everything is grey, fuzzy, and nebulous. Sometimes they are disappointed by this; they are hoping for sets of skills and tools that will help them find the ‘one best way’ to manage their organizations. But management is not a toolbox. It is a mindset, a way of thinking, a set of mental muscles that must be exercised.

That realization is hard for some because the lure of absolute truth is strong. Indeed, the first management gurus promised that they had found it. They had developed a set of rules for management, and all the rest of us had to do was follow them. Some management gurus today still make that promise. Those are the ones we should avoid.

the first management gurus

People have been writing about the problems of management for a very long time. One of the first to do so was the Indian bureaucrat and sage Kautilya in his famous work Arthashastra. In chapters on treasury and the building of fortresses, Kautilya muses on the duties of administrators and their roles and function. These brief thoughts were followed and expanded upon by later writers including Yajnavalkya, Kamandakya, Sukra, and perhaps most famously Somadeva. Persian writers such as Nizam al-Mulk and Kai Kaus were probably influenced by Kautilya, as were later Muslim scholars such as Abu Fadl al-Dimashqi and Ibn Khaldun. Christian medieval scholars such as John of Salisbury and St Thomas Aquinas also mused on the problems of managing organizations and a preaching friar, St Bernardino, went so far as to spell out the qualities which make a good manager.

Formal theorizing about management, however, only begins in the late eighteenth century in the West, as the Industrial Revolution was beginning to gather pace, and coalesced in the first coherent theory of management, scientific management. This theory developed during the period 1895-1915 and is usually associated with the engineer Frederick Winslow Taylor, though many other people were involved. Scientific management differed from the earlier, largely philosophical discussions of management in that it offered not just discussions of the purpose and meaning of management, but also precise recipes as to how to do it. Time and motion studies were used to determine the best method of carrying out a task; workers were then trained to work using those methods so as to save time and labor and increase both profit for the company and earnings for themselves. This was called the ‘one best way’.

The idea of the one best way was very seductive, and still is. If we could find the right recipe for running organizations, just like the right recipe for a great meal or a perfect cocktail, then surely we would achieve success. Profit and riches will follow. But within a few years of the publication of Taylor’s master work, Principles of Scientific Management, economist Robert Hoxie had pointed out the obvious. Businesses and other organizations are not simply collections of ingredients. You cannot design them, in the way that you would a cocktail, or a machine. “There is no single necessary or logical line of industrial development”, wrote Hoxie in his book Scientific Management and Labour, “no perfectly uniform set of conditions and problems in different industries or even in different shops with the same general productive output. There can, then, be no single system of organization of methods equally applicable to all industries and to all shop conditions.”

The entire history of the scientific management movement is one of seeking a perfection of method and organization that does not and cannot ever exist. Subsequent iterations of scientific management such as methods-time measurement in the 1940s and business process re-engineering in the 1990s ran into the same problem. What works for one organization will not work for another.

But, did this mean that scientific management was therefore entirely worthless? Not at all. There was and still is much to be said for standardizing certain work processes so as to achieve greater quality and deliver value to customers. Time and motion studies are still used to help eliminate waste. The problem for the practicing manager was this: how to find the right place between the extremes of the gurus of the scientific management movement, who argued that all one had to do was follow their methods and success come sure as day follows night, or the critics like Hoxie who regarded the whole of idea of scientific management as starting from the wrong premise.

the golden age of management gurus

But managers continued to listen to persuasive voices who offered them a way out of the maze of uncertainty, and this led to the emergence of the modern management gurus. Mostly American and mostly men, usually from academic or consulting backgrounds, they offered sage advice that younger managers lapped up quickly, and all too often uncritically.

The first and most important of the new breed of gurus was Peter Drucker. Born and educated in Austria, Drucker moved to America before the Second World War. His book The Practice of Management, published in 1954, was the foundation stone of the new guru movement. In fairness, Drucker did not set himself up as the fount of all wisdom on management, nor did he do so in subsequent books such as The Effective Executive. His purpose was to sieve out the fundamentals of management, the things that he felt were basic to the managerial task. Drucker recognized that at its heart, management is quite a simple concept; it is the doing of management that is hard, and he tried to give advice to younger managers on how they might cut through some of the surrounding complexities and get at the basics of management. Alas, all too often Drucker has been read as a kind of a bible, a mantra to be recited rather than a stimulus to independent thought and action. Today he is quoted like a kind of ancient sage. But it was common sense, not holy writ that Drucker was anxious to dispense.

Many others followed in Drucker’s footsteps, and they were diverse in their opinions and views, so much so that ‘management guru’ becomes a very loose category indeed. Some were process driven, like Michael Hammer and James Champy, the architects of business process re-engineering. Process-driven too, though they would hate to be described as such, were Tom Peters and Robert Waterman, author of the global bestseller In Search of Excellence, which offered a strategic and organizational model which they insisted was common to all successful companies. Alas, within a few years of the publication of
In Search of Excellence, many of the companies they studied had disappeared, some failed entirely.

Edwards Deming and Joseph Juran, gurus of quality management, took a slightly different approach. Process was important to them, but they argued that quality begins with a mindset, a belief in quality, and a desire to put quality first and embed quality thinking in the heart of the strategic and business model. Of similar vein was Kenichi Ohmae, the Japanese strategy guru who argued against process approaches to strategy and urged managers to cultivate strategic thinking as a discipline that one practices every day, just as one might exercise to keep physically fit. Henry Mintzberg argued similarly for strategy as a constant process, while also shooting down the pretensions of other, more process-driven gurus. Rosabeth Moss Kanter, one of the few women to enter the ranks of the gurus, argued for more flexible approaches to organization, and the godfathers of modern leadership theory, John Kotter and Warren Bennis, also stepped away from task-based approaches to leadership and introduced a more philosophical tone.

On the fringes of the guru movement but doubtless part of it were the leading business executives of the day, again mostly American: Jack Welch, Lou Gerstner, Lee Iacocca, Andrew Grove and others who wrote their own accounts and offered lessons from their own experience. Their books are valuable accounts of what happened at a particular time and place, and Grove in particular is a thoughtful man who tries to generalize from his own experience and offer thoughts for others; Only the Paranoid Survive is still a book I recommend to students. But once again, it is absolutely necessary for readers to analyze the contents and draw out their own lessons. None of these writers or any of the gurus offer ‘cookie-cutter’ solutions to business problems; at least, not ones that work.

the future of the gurus

The gurus themselves did well. Their books sold hundreds of thousands of copies, sometimes even millions, and they were in high demand as motivational speakers. Some, like economist Michael Porter, set up their own consultancy companies to disseminate their works further. But the downturn at the end of the millennium brought about a decline in the fortunes of the gurus. It was pointed out, quite correctly, that the lessons of the gurus had not saved companies from the brutal economic downturn of 2001-02, or the even more savage economic crash of 2008. Despite all that the gurus wrote and said, companies were still getting it wrong. Managers stopped buying business books, at least in such great numbers; today, it is relatively rare for a guru-style management book to sell more than 10,000 copies in the US and European markets combined. Some predicted the end of the age of the guru.

But businesses still operate in an uncertain world, and the human mind continues to crave certainty and the reduction of risk just as it has always done. People who promise to act as guides through the mists and haze that surround every company will still be listened to. Some gurus from the 1990s such as Gary Hamel, Clayton Christensen, and Jim Collins continue to be popular, and newcomers such as Marshall Goldsmith, Roger Martin, Lynda Gratton, and Herminia Ibarra have joined the ranks of respected figures whose voices are listened to. But the old problem persists: ‘how’ should we listen to the gurus, and ‘what’ lessons should we learn from them?

As I said above, it is quite correct that the ideas of the gurus did not save the business world in 2001 or 2008. But is that the fault of the gurus? Or does the problem lie in what we want from them? Do we expect too much? Do we expect them to give us the wisdom we need to run our businesses and keep them safe and profitable? Do we want simple recipes that we can follow, like novice cooks in a baking contest, turning a mass of ingredients into a simple and palatable dish?

If so, then we are expecting the wrong things. Because each of us has a different set of ingredients—not least in the people we employ and manage— and each of us is trying to create a different dish. One of the goals of management, remember is to create a business that stands out from its competitors, that is ‘different’ from them, rather than one that looks exactly like every other business in the category. And it is not reasonable to suggest that we can create a series of different and distinct businesses each with its own unique competitive advantages, by using the same recipe.

Despite the title of this column, I am not a guru, nor have I any ambition to become one. But there is one thing I tell my students every year, and have done so for the last twenty years: the most important source of learning about business is yourself. As Drucker indicated, management is largely a matter of common sense. There may be some skills you require, which can be learned easily from a textbook or a MOOC. But most of what you need to know about management, you already know. The only valid purpose of a guru is to act as a catalyst to help you understand yourself better and unlock the courage and confidence you need to become a manager and a leader.

If you can find a guru who can help you to do that, good; that is the guru for you. Listen to them, analyze what they say and use their wisdom to help you learn about yourself. But if you meet a guru who says, I have the secret of success; listen to me, and you will become a great leader and your company will prosper, then ignore them. Walk on, and leave them standing at the side of the road.

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