Wednesday, May 20, 2015

The Latest Management Technique

An audience listens enchanted to a wise and brilliant speaker. They leave in a daze, no idea what to do next. (Management by fads)
Nails are hammered in a huge wooden plate. Threads are stretched and wound between them. It doesn’t result in a recognizable picture. Grown-ups play children’s games without pleasure. (Unthinking application of management techniques)

These two belong together, though the first one is the province of empty-headed top people and the second one is the province of lightweights one or two levels lower.

Of course, most of these techniques are useful, few are useless. But usually they have a much more limited application than their champions advertise, especially those about leadership and motivation. There are as few recipes for keeping employees happy and productive as there are recipes for marital felicity. Even sensible approaches can be misapplied and become nonsensical. I have seen overhead ratios brought back and the percentage of productive functions increased to the detriment of over-all productivity. The once famous 7-S model of McKinsey was nothing more than a checklist with a gimmick. Again, even simple checklist can be useful if they draw attention to underestimated aspects of organizational health, but applying techniques without real knowledge of the work processes involved leads astray. With knowledge, interest and judgment in place, most new techniques perform. Without knowledge, interest and judgment even proven techniques lead to sham success.

Management literature is replete with reinventing the wheel, but now with a fashionable twist. Even one of the most worthwhile endeavors - applied system dynamics - can lead nowhere when the analysis is too broad or too limited. I saw a system dynamics analysis of the American intervention in Afghanistan that convinced me that the intervention was bound to fail. And what about strategic planning that doesn't show even an inkling of what a stable desirable situation could look like? I have heard brilliant negotiation experts rattling away their precious (at least expensive) teachings without any notion of the factual conditions of the negotiations the audience was involved in.

Enthusiastic proponents of new management techniques are most successful when they interface with critical and seasoned practitioners. That interaction is key to success. But often the prophets are into a conversion game, not a practical improvement game. When a company trading in building materials took over supermarkets for do-it-yourself stuff, they applied rigidly their proven success formula: to go for margin. They eliminated all articles that to them had ridiculous low margins. Within a year they had to sell their acquisition with great loss. They didn't understand that in such shops turn-over speed is a much more important indicator than margin. And they didn't understand that buyers leave when they have to visit several shops to get what they want. One-stop shopping is important for people involved in maintenance and repair and in home improvement.

See new management techniques for what they usually are: a new methodical viewpoint that gives a new and possibly useful view. But without knowledge and judgment of the products, services and activities involved it is just icing without a cake.

And why do I consider this a systemic problem? Because underlying is the decoupling of management from effort and responsibility, from the real world. There is no methodical solution to that problem, only a gross cleansing of all management layers, especially the higher ones. That only happens in Neverland. What happens in reality is bankruptcy in the private sector and what is euphemistically called restructuring in the public sector.

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