The Management Myth

Most of management theory is inane, writes our correspondent, the founder of a consulting firm. If you want to succeed in business, don’t get an M.B.A. Study philosophy instead
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If you believed our chief of recruiting, the consulting firm I helped to found represented a complete revolution from the Taylorist practices of conventional organizations. Our firm wasn’t about bureaucratic control and robotic efficiency in the pursuit of profit. It was about love.

We were very much of the moment. In the 1990s, the gurus were unanimous in their conviction that the world was about to bring forth an entirely new mode of human cooperation, which they identified variously as the “information-based organization,” the “intellectual holding company,” the “learning organization,” and the “perpetually creative organization.” “R-I-P. Rip, shred, tear, mutilate, destroy that hierarchy,” said über-guru Tom Peters, with characteristic understatement. The “end of bureaucracy” is nigh, wrote Gifford Pinchot of “intrapreneuring” fame. According to all the experts, the enemy of the “new” organization was lurking in every episode of Leave It to Beaver.

Many good things can be said about the “new” organization of the 1990s. And who would want to take a stand against creativity, freedom, empowerment, and—yes, let’s call it by its name—love? One thing that cannot be said of the “new” organization, however, is that it is new.

In 1983, a Harvard Business School professor, Rosabeth Moss Kanter, beat the would-be revolutionaries of the nineties to the punch when she argued that rigid “segmentalist” corporate bureaucracies were in the process of giving way to new “integrative” organizations, which were “informal” and “change-oriented.” But Kanter was just summarizing a view that had currency at least as early as 1961, when Tom Burns and G. M. Stalker published an influential book criticizing the old, “mechanistic” organization and championing the new, “organic” one. In language that eerily anticipated many a dot-com prospectus, they described how innovative firms benefited from “lateral” versus “vertical” information flows, the use of “ad hoc” centers of coordination, and the continuous redefinition of jobs. The “flat” organization was first explicitly celebrated by James C. Worthy, in his study of Sears in the 1940s, and W. B. Given coined the term “bottom-up management” in 1949. And then there was Mary Parker Follett, who in the 1920s attacked “departmentalized” thinking, praised change-oriented and informal structures, and—Rosabeth Moss Kanter fans please take note—advocated the “integrative” organization.

If there was a defining moment in this long and strangely forgetful tradition of “humanist” organization theory—a single case that best explains the meaning of the infinitely repeating whole—it was arguably the work of Professor Elton Mayo of the Harvard Business School in the 1920s. Mayo, an Australian, was everything Taylor was not: sophisticated, educated at the finest institutions, a little distant and effete, and perhaps too familiar with Freudian psychoanalysis for his own good.

A researcher named Homer Hibarger had been testing theories about the effect of workplace illumination on worker productivity. His work, not surprisingly, had been sponsored by a maker of electric lightbulbs. While a group of female workers assembled telephone relays and receiver coils, Homer turned the lights up. Productivity went up. Then he turned the lights down. Productivity still went up! Puzzled, Homer tried a new series of interventions. First, he told the “girls” that they would be entitled to two five-minute breaks every day. Productivity went up. Next it was six breaks a day. Productivity went up again. Then he let them leave an hour early every day. Up again. Free lunches and refreshments. Up! Then Homer cut the breaks, reinstated the old workday, and scrapped the free food. But productivity barely dipped at all.

Mayo, who was brought in to make sense of this, was exultant. His theory: the various interventions in workplace routine were as nothing compared with the new interpersonal dynamics generated by the experimental situation itself. “What actually happened,” he wrote, “was that six individuals became a team and the team gave itself wholeheartedly and spontaneously to cooperation … They felt themselves to be participating, freely and without afterthought, and were happy in the knowledge that they were working without coercion.” The lessons Mayo drew from the experiment are in fact indistinguishable from those championed by the gurus of the nineties: vertical hierarchies based on concepts of rationality and control are bad; flat organizations based on freedom, teamwork, and fluid job definitions are good.

On further scrutiny, however, it turned out that two workers who were deemed early on to be “uncooperative” had been replaced with friendlier women. Even more disturbing, these exceptionally cooperative individuals earned significantly higher wages for their participation in the experiment. Later, in response to his critics, Mayo insisted that something so crude as financial incentives could not possibly explain the miracles he witnessed. That didn’t make his method any more “scientific.”

Mayo’s work sheds light on the dark side of the “humanist” tradition in management theory. There is something undeniably creepy about a clipboard-bearing man hovering around a group of factory women, flicking the lights on and off and dishing out candy bars. All of that humanity—as anyone in my old firm could have told you—was just a more subtle form of bureaucratic control. It was a way of harnessing the workers’ sense of identity and well-being to the goals of the organization, an effort to get each worker to participate in an ever more refined form of her own enslavement.

So why is Mayo’s message constantly recycled and presented as something radically new and liberating? Why does every new management theorist seem to want to outdo Chairman Mao in calling for perpetual havoc on the old order? Very simply, because all economic organizations involve at least some degree of power, and power always pisses people off. That is the human condition. At the end of the day, it isn’t a new world order that the management theorists are after; it’s the sensation of the revolutionary moment. They long for that exhilarating instant when they’re fighting the good fight and imagining a future utopia. What happens after the revolution—civil war and Stalinism being good bets—could not be of less concern.

Between them, Taylor and Mayo carved up the world of management theory. According to my scientific sampling, you can save yourself from reading about 99 percent of all the management literature once you master this dialectic between rationalists and humanists. The Taylorite rationalist says: Be efficient! The Mayo-ist humanist replies: Hey, these are people we’re talking about! And the debate goes on. Ultimately, it’s just another installment in the ongoing saga of reason and passion, of the individual and the group.

The tragedy, for those who value their reading time, is that Rousseau and Shakespeare said it all much, much better. In the 5,200 years since the Sumerians first etched their pictograms on clay tablets, come to think of it, human beings have produced an astonishing wealth of creative expression on the topics of reason, passion, and living with other people. In books, poems, plays, music, works of art, and plain old graffiti, they have explored what it means to struggle against adversity, to apply their extraordinary faculty of reason to the world, and to confront the naked truth about what motivates their fellow human animals. These works are every bit as relevant to the dilemmas faced by managers in their quest to make the world a more productive place as any of the management literature.

In the case of my old firm, incidentally, the endgame was civil war. Those who talked loudest about the ideals of the “new” organization, as it turned out, had the least love in their hearts. By a strange twist of fate, I owe the long- evity of my own consulting career to this circumstance. When I first announced my intention to withdraw from the firm in order to pursue my vocation as an unpublishable philosopher at large, my partners let me know that they would gladly regard my investment in the firm as a selfless contribution to their financial well-being. By the time I managed to extricate myself from their loving embrace, nearly three years later, the partnership had for other reasons descended into the kind of Hobbesian war of all against all from which only the lawyers emerge smiling. The firm was temporarily rescued by a dot-com company, but within a year both the savior and the saved collapsed in a richly deserved bankruptcy. Of course, your experience in a “new” organization may be different.

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