There seems to be great appeal at the present time, for consultants and organizational behavior specialists to advocate a “holistic” approach to management. Yet, there is not only humor, but also irony in the concept of a 30 something year old consultant sitting in the office of a COO or CEO of a Fortune 500 company and suggesting that the company should have a more “networked” approach to management, that the idea of organizational charts and marketing plans is passé, that what their employees and customers want is really a more altruistic approach to life and a better ability for the company to partner with them to solve their problems. Well, partnering, OK, perhaps today’s CEO can accept that concept as one which would help sales. But, he certainly knows that really only 3 things matter in his world. What are they, the top line, the bottom line and the share price and what are they now as compared to what they were last week, month, or year?
If one can imagine oneself momentarily being that CEO or COO and hearing this stuff it would be natural to think, “Is he just naïve, or is he stupid, because there probably isn’t a third possibility?” Well, in fact, he is probably not stupid or he wouldn’t be sitting in that office, but he probably is naïve, and naïve in a sense that we have not been since we just got out of college, so perhaps we have forgotten how naïve one can be. As the fierce, strong, intelligent, well-educated executive that the CEO or COO is and in the clever Machiavellian manner he clawed his way to the top, he is probably wondering why he is listening to this stuff at all. Most likely, he is listening because someone from this guy’s company got the ear of some board member of the company and convinced him it sounded good. But altruism doesn’t run the world and the executive knows he doesn’t get to keep his job if the numbers don’t show what needs to be shown. Thus he thinks, “So, how can I get this guy out of my office so I can go back to my organizational charts and other stuff I know so well?”
Interestingly, it is not just the consultant who is naïve here. Both the consultant and the CEO or COO are naïve, but in different ways. If one were to scan commercial TV for as little as 2 hours, chances are one would see at least 4 advertisements targeted at people who feel their companies treat them like machines. They are either enticing people to go into their own dot.com business or to switch jobs for something better, usually over the Internet. This fact is significant for a very crucial reason. The people with the marketing minds, have targeted the dissatisfied, but competent employee, but the companies they are enticing them to are not necessarily ready to fit the needs they are seeking. This fact exists because most large organizations are run by Machiavellian individuals, who have the power to control the structure and direction and information flow within the organization, and they know how to do it well, or they wouldn’t be where they are.
This then returns one to what would make such a person want to change the structure of his organization. In looking at organizations, one would find that those with looser, networked structures seem to perform better in the medium term and certainly in the long term, if not the short term. Additionally, employees are being treated more like machines than like people and with the advent of engineered work standards being applied to everything from selecting groceries to “411 information” operators, employees feel like the company sees them as machines as well. This situation creates an inevitable feeling of “non-loyalty”, if not outright “disloyalty” to the employer. The employees will continue to be more and more mobile rather than static and they will seek the type of work environment that will fit their needs. The large organizations will be left with two types of workers, the incompetent, and the “disgruntled competent”, those that choose not to seek other employment, but don’t like it where they are now. Productivity, efficiency, bottom line and share price will start to fall. When that happens, there is a reason to change. That is what will happen as a result of continued Machiavellian Bureaucracy in the face of employee thought revolution.
Up till now, sociologists and organizational developers have operated on the theory that people should just act “nicer.” But, then I guess, they have rarely worked in a Fortune 500 environment. They have utilized “holistics” and “quantum physics” to rationalize their approach, when in fact it is the weakest part of their theories. They felt that if they based their theories on physical science, then they would be believable or acceptable. But, in business, the world is driven by money and power and until these forces are affected, there will not be a change to a more networked style of management. There will not be a change from “Knowledge is Power” to “Information is Nurture for New Ideas.” When money and power are affected, then there will be force to change.
It is currently popular to describe new organizational methods in terms of the “New Science” approach. This method is described both by Margaret Wheatley (The Simpler Way, Leadership through New Science) and by Danah Zohar (The Quantum Self, The Quantum Society, Rewiring The Corporate Brain). The idea of this management method is to see information as food, the “royal jelly” if you will, that nurtures new ideas within an organization. Additionally, the new approach belies the Newtonian 16th Century physics model and utilizes Quantum Mechanics as the basis of the New Management approach.
At the same time as consultants and organizational development specialists are advocating a model that treats information as ‘food’ instead of ‘power’, the ones with the present power in big organizations are there because they have utilized a Machiavellian Model, for the most part, to gain rapid advancement within an organization. This method of Machiavellian management and advancement, works best in more bureaucratic organizations. The more tied an organization is to organizational charts and strict job descriptions, the more easily the Machiavellian personality can take advantage of this system.
The Implications, ‘So What’
While sociologists, organizational development specialists and organizational consultants are correct that a more “networked” approach to management will improve the overall productivity of the organization, they fall back on a scientific, interdisciplinary approach to justify their theories. In reality, using the scientific approach to support new management theories is not a necessarily valid avenue to invoke. While they admit, that they have little understanding of quantum mechanics and they admit that they use it partially as a rationale for their theory. They also tend to refute the concepts of thermodynamics. In fact, thermodynamics may be the only thing that remains unchanged in the New Science of quantum mechanics and that the theory of entropy (that in a closed system, without any forces acting on the particles, they will seek a random distribution within the system), is still a valid scientific theory and works even with quantum mechanics.
Also, there is a failure to realize that Newtonian Mechanics, like Quantum Physics, is only a model, albeit a more accurate model, but it does not necessarily invalidate the prior bodies of knowledge. For medium and large objects, Newton’s model still works properly. It is only on the subatomic level that these things break down and can no longer be relied upon. Who is to say, that in the year 2500, we will not look back and say, quantum mechanics was a pretty good model, but now we know it works like this?
The Reconciliation of the Two Views
Any manager of a large organization or a small organization could benefit from using a more networked style of management as recommended by the organizational developers. All these people can potentially gain from an understanding of why they should consider shifting from a Bureaucratic organization to one that utilizes the knowledge and experience of every worker in their company.
Those in positions of power to make these changes happen, need a reason. There are two reasons to look at improved management styles through open information channels. Firstly, employees are getting tired of being treated like numbers in big corporations and they are looking for alternatives. Second, employee power, not employee empowerment will drive this change.
Because 60% of market capitalization is in the hands of 401K’s and Pension plans and because there are millions of shares in the hands of employees as a result of the 70’s and 80’s merger madness that pushed companies into Employee Stock Purchase Plans, employees are now in position to control their own companies, they in fact own a goodly portion of them at this point in time.
Research, Examples, Expertise
As one in the warehousing and distribution business for 20 years, I was able to use some of these management principles in actual life and found that they do yield better results in almost any area. Additionally, I was the Sr. V-P of a Fortune 500 company where I was able to use these techniques and see improvements in actual numbers.
The Quantum Manager
The ‘Quantum Manager’, is one who uses his people as a network so that all information in the organization can be available for use when in the midst of solving problems. Additionally, this information and this interdisciplinary approach allows for increased creativity in the system.
The system is based on an interdisciplinary approach, which comes from physics chemistry and biology. They are starting to combine their knowledge pools and find that many of the things they are studying, interact. The New Science Management is an effort to, in some way pull interdisciplinary theories within an organization together to yield better and more creative solutions to problems. While this system does work and is useful, it is not necessarily related to the interdisciplinary approach to science. It is probably coincidental, but it is not coincidental that people have had enough of working for next quarter’s numbers and being treated like machines.
The Machiavellian Manager
While the New Science theory of management seems to make sense, it relies on a basic altruistic approach to life. In contrast to this approach to life is the interaction of self- interest. This interaction is especially important when speaking about new organizational structures. That is because those who are in a position to change the structure of organizations are also the ones with the power and more likely than not, have used Machiavellian techniques to get to where they are.
The Disillusioned Worker
Today’s worker is disillusioned in that they want to feel like they are part of a whole. They want to feel that their contribution to the organization is productive. But, that is not the message that is being projected by their managers. Their message takes more of a Machiavellian form and is more in line with a position that reveals the truth in Big Business. There are really only 3 things that matter to a public company. These are, the Revenue Line, The Profit Line and the Share Price. Of those 3, the share price is the most important.
As a result, employees are treated like parts in a machine that can be moved around at will. This situation has created a reality, that reality is “NO EMPLOYEE LOYALTY.” Why should an employee be loyal to the company when the company is not loyal to them?
Employee Power & Revolution
In the past, consultants have tried to convince employers that employee empowerment is the way to go. Empowerment is a good tool and can be very effective. But, this system will not drive the move to structural management change. There are two things that will drive a move to a new management structure that recognizes and rewards the dignity of individual employees. These reasons are primarily economic, and need to be, or they just show soft benefits, if they show benefits at all.
This management restructure will be achieved by an employee ‘revolution’ grasping the power that is now theirs; they just have not recognized it yet. The following are examples of employee power, which could be exercised in the near future:
1) Organized voting by employees against directors, especially the CEO
2) Mobile employees, if they don’t like it where they are, they will move to another company that will appreciate them
3) Static organizations die, Dynamic organizations prosper
A New Management Structure
While presently, it seems anathema, to expect that the leaders of the corporations would change their methods and become “coaches” and “information disseminators”, instead of purely ‘delegators’ and ‘information hoarders’, this change will come about. It will come about due to the fact that the current management style will leave the company with only 2 types of workers:
1) The Incompetent
2) The Disgruntled Competent
Under these circumstances, the organization will slowly, or even quickly cease to exist. Those managers who are presiding over the current demise as a result of their practices will be replaced. The new management structure will look toward its leaders to provide what is needed in today’s environment. They need to provide Leadership, Motivation, Encouragement, Information and an environment that makes employees understand their contribution and gives the proper nurture and recognition to those employees or those employee groups. Additionally, it will be incumbent upon these managers to restructure the way employees are organized within the organization in order to achieve more efficient and more effective and more creative solutions to existing problems.
In writing this article, the following sources will be utilized:
Drucker, Peter F., “Management Challenges for the 21st Century”, HarperCollins Publishers, N.Y., N.Y., 1999
Freidman, Thomas L., “The Year Y2K Social Disease”, New York Times, N.Y., N.Y., August, 1999.
Drucker, Peter F., “Managing Oneself”, The Harvard Business Review, Boston, MA., March-April, 1999.
Maccoby, Michael, “Narcisstic Leaders: The Incredible Pros, the Inevitable Cons”, The Harvard Business Review, Boston, MA., January-February 2000.
Wheatley, Margaret & Kellner-Rogers, Myron., “A Simpler Way”, Berrett-Koehler Publishers, San Francisco, CA. 1996, 1999.
Wheatley, Margaret, “Leadership And The New Science”, Berrett-Koehler Publishers, San Francisco, CA., 1999.
Zohar, Danah, “Rewiring The Corporate Brain”, Berret-Koehler Publishers, San Francisco, CA., 1997.
Zohar, Danah and Marshall, Ian, The Quantum Society”, Quill-William Morrow, N.Y., N.Y., 1994.
Zohar, Danah, “The Quantum Self”, Quill-William Morrow, N.Y., N.Y., 1990.
Bing, Stanley, “What Would Machiavelli Do? The Ends Justify The Meanness”, HarperCollins Publishers, Inc., N.Y., N.Y., 2000.
From Michael Carbone's Resolving It newsletter.In 1997 the California Legislature enacted Evidence Code Sections 1115-1128, which established mediation confidentiality as an evidentiary exclusion in California. The purposes of this legislation...By Michael P. Carbone