March 2003 - Management fads

In a momentous week that could change the political map of the world it seems odd to be writing of the everyday concerns of working people. Yet, when the dust settles on the Middle East, and the ink has dried on this latest chapter in the history of global conflict, work will remain the social continuum that defines the course of our lives.

There has been much talk of a new world order by those who believe that change is implicit in the passage of events. It concurs with the popular belief that capitalist society is itself experiencing a great upheaval that could transform the way people relate to the workplace.

Perhaps this was why I was drawn to a counter-argument proposed by James Hoopes, a history professor at Babson College in the US, in a forthcoming book* on management history. In this hard-hitting critique of management shibboleths, Prof Hoopes outlines a simple view of the company as an authoritarian institution that succeeds because it invests power in managers to extract performance from employees.

This is what it has always been, he argues - at least from the time of Frederick W. Taylor and his development of scientific management that sought to wrest control of the job from the worker. More to the point, Prof Hoopes concludes that this is the way it will continue and this is the way it has to be in a capitalist system that exists to generate profit.

At the same time he concedes that America's founding fathers never intended work to be this way. Thomas Jefferson, for example, was a great advocate of self-employment, believing that the US should be a nation of independent farmers. He declared that he never wanted to find his "fellow citizens at a work bench". That the work bench, or these days the screen and cubicle, is exactly where we can find so many employees today, writes Prof Hoopes, is a result of the plain fact that office work "pays better than tilling the land".

But salaried workers have paid a price for their higher wages by sacrificing certain freedoms to the demands of the corporate autocracy. As Prof Hoopes points out, "free speech often stops when work begins".

"As much as we can," he writes, "we ignore the fact that we check many of our freedoms at the workplace door and that ordinary citizens get their closest exposure to undemocratic government when they go to work for a corporation."

If this observation is discomfiting, it is even more worrying when he suggests that over the years management gurus and their ideas have created something of a smokescreen for the real nature of the management-subordinate relationship. "To make corporate life more palatable to Americans," he writes, "some of the gurus have unrealistically minimised the amount of power it takes to manage." The power invested in management, he believes, is crucial to the profit-making enterprise.

His argument is based on a five-year study of some of the most important gurus of US management. His conclusions are unsettling, suggesting that the most significant tenets of management theory embedded in big business are as flimsy as a house of cards.

In a series of selective and well researched potted histories of the work of people such as Taylor, Elton Mayo, Mary Parker Follett, Chester Barnard, W. Edwards Deming and Peter Drucker, he seeks to separate the idealism of the theorist from the reality of the workplace.

That idealism coloured the conclusions of Elton Mayo, over the long-running experiments looking at employee morale and motivation at Western Electric's Hawthorne Works in Chicago, is well documented. Prof Hoopes does not confine his questions to those who are no longer around to contradict him. He is equally surgical and sceptical in his analysis of the teachings of those such as Peter Drucker, Tom Peters, Warren Bennis and Peter Senge.

Some of his most telling observations note how ideas sometimes ran away from their originators as they were repackaged by consultants. Deming, for example, disliked the way that his organisation-wide focus on improvement came to be labelled "total quality management", a catch-all phrase that was attached to faddish interpretations of his ideas.

Even Peter Drucker - the gurus' guru - does not escape criticism. He wasted too much time, says the author, as did other gurus in his generation, trying to establish a "moral legitimacy" for management that has created "unrealistic hopes" of democracy in companies that are anything but democratic.

At the same time, however, Prof Hoopes points to many practical management improvements pioneered by Mr Drucker, particularly his "management by objectives" that focuses on the aims of the enterprise, concentrating on a goal, not on the vagaries of personal taste. "There is less risk of hurt and a better chance of good work when manager and employee focus on the objective needs of the business rather than each other's subjective psychology," notes Prof Hoopes.

It would be heartening to record that the book revealed a path for a more enlightened form of capitalism in future. On the contrary, the author's scholarly cynicism is maintained to the end. In fact he suggests that some of the more recent business concepts inspired by business process re-engineering - the dissolution of demarcation lines and looser job descriptions, for example - have created more rather than less arbitrary power among managers.

His analysis of corporate leadership is prescient. Too often, he says, leadership studies concentrate on the benevolent idealistic features of the job, omitting the controlling and coercive side. Prof Hoopes concludes that the corporation, once described by Peter Drucker as the representative institution of society, is "not a good model for the rest of a democratic society". Further, he decides that the idea of "democratising corporations and legitimising management is a pipe dream".

More worrying still in this critique is the absence of an alternative to the corporation. "Top-down power and its potential abuse are here to stay in corporate America. It is foolish to think otherwise," he says.

But that is capitalism for you. At least we are not talking about the nation state. Or are we? His book ends with a throw-away line: "It is all too possible to run a country like a company."

False Prophets, the Gurus who Created Modern Management and Why their Ideas are Bad for Business Today, by James Hoopes, to be published in May by Perseus Publishing, price $27.50

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