Where Will Management Innovation Take Us?
Management could change a lot in the coming years, says HBS professor Jim Heskett. A few reasons: continued development of the Internet and the transparency and communities it has spawned, and new attitudes toward work. But will innovation in management mostly be confined to entrepreneurs? What do you think? Online forum now closed.
Will management innovation be "pushed" or "pulled"? Competitive organizations in the future will be managed differently. This will require new roles for managers. But according to respondents to this month's column, just how this will occur within the organization is not clear. Many suggested that the kind of management innovation described by Gary Hamel in his new book, The Future of Management, will more likely occur as a result of forces outside the organization.
Tony Gattis described the organization of the future as one that parallels much of what Hamel foresees. He quoted Thomas Malone's writing that "We are in the early stages of an increase of human freedom in business that may, in the long run, be as important a change for businesses as the change to democracy was for governments...." Nari Kannan commented that there is a growing "realization that functional management is an artifact of the 20th Century," that it will decline as organizations are reformed around "processes (that) cut across many functions...." The role of many managers in the future, according to Gerald Nanninga, will involve tasks requiring "no boss/subordinate hierarchy." As he puts it, "The power to fire no longer holds much weight." Peter Thuku believes that the role of "The management of the future will be more of referees among the different teams of the organization."
Others were less enthralled with the possibilities. For example, Michelle Malay Carter commented, "Less management by managers is exactly the wrong thing.... It is our poor understanding and use of hierarchies that has undermined our organizations." Pete DeLisi said, "There seems to be nothing new here.... It's the old dialectic between professional management ... and entrepreneurialism...."
Many commented that it will take time. Paul Williams implied that it will at least require the retirement of Baby Boomers in commenting that "... it appears that Boomer Management is unwilling to rock the boat as they sail into retirement...." Haresh Vaishnu concurred in saying, "It will take the ... passing of the leadership role to (the) next generation .... When the underlying workforce that management is supposed to manage is changing it cannot afford to stand still."
Aiden Kenny posed an interesting dichotomy for us when he said, "(Hamel) implies that it will be management who leads ('pulls') the innovationů. In my opinion the drive for innovation will come from ... newer generations ... (leading to) a 'push' of (management) innovation...." This implies, of course, that newer generations of talent will retain their innovative ways as they mature. Or that important tasks of management will be ceded to those lower in the ranks while newly-minted senior managers still maintain their enthusiasm for management innovation. (Few thought this was likely to happen.) Alternatively, will the drive for management innovation come from a source other than social forces within the organization? As several suggested, these may include new technologies and their mastery for management (or self-management) purposes; intense business competition from practitioners of new management practices; or a natural flow of talent to organizations practicing management innovation. Will management innovation be "pushed" or "pulled"? What do you think?
(To read more, see Thomas Malone, The Future of Work: How the New Order of Business Will Shape Your Organization, Your Management Style and Your Life, HBS Press 2004.)
There appears to be a growing impatience with the lack of progress in management innovation and change in the very roles that managers play. Gary Hamel in his new book, The Future of Management, regards management innovation as "anything that substantially alters the way in which the work of management is carried out," including organizational forms. He distinguishes it from operational, product/service, or strategic innovation. Although he maintains that only limited incremental management innovation has taken place since the early part of the twentieth century, he believes the time may be right for significant change. He's not alone. Theodore Zeldin, a British historian who has spent a great deal of time studying the world of work, stated recently in an interview with the Financial Times that "the world of work must be revolutionized to put people—rather than things—at the centre of all endeavors."
Hamel envisions a future in which the goal of management is to build "nimble" organizations in which innovation is everyone's job; there is slack among human and other resources that allows people to think, innovate, and take measured risk outside the core activities of the business; there is more freedom and self-management and less management as we know it; there is more community and less hierarchy; and there is more shared sense of purpose and less need for management "exhortation." He sees many of these things in each of several organizations—including Whole Foods Markets, W. L. Gore, and Google—that he examines in some depth. These organizations share some things in common. All are operated in a team mode, with power given to the teams to run mini-businesses, including hiring, training, and firing personnel. All reward teams at all levels for performance. All provide generally unmonitored time for employees to develop product and service innovations as well as either redesign their jobs or relocate themselves within the organization. All share an extraordinary amount of information at all levels and devote a great deal of resources to making sure that all employees are connected. All "herald a future in which the work of managers is performed less and less by 'managers'." All are among the most outstanding places to work. All produce unusually high profits in their respective industries, which Hamel implies is the result of management innovation. And none are led by MBAs.
Reasons why we might see an unusual amount of management innovation in the coming years would certainly include the continued development of the Internet and the transparency and communities it has spawned, new attitudes toward work and the way it is performed, and global competition and cooperation, much of it fostered by the Internet. But will these forces outweigh the natural tendency of those in control to resist change? Will management innovation largely be confined to entrepreneurs (like those above) with little exposure to traditional management concepts? Even so, can we expect a slow but steady change in the list of most-admired organizations in the next few years as Gen X'ers and Y'ers assume leadership? And how will this all affect the teaching of management, which Hamel argues clings to time-worn management innovations of the twentieth century to which the founders of new-generation firms were largely not exposed? Hamel, admitting that he does not have all the answers, poses our question of the month: "What does the future of management look like to you?" What do you think?
To read more:
Gary Hamel, The Future of Management (Boston: Harvard Business School Press, 2007)
John Thornhill, "France's favourite Englishman," Financial Times, February 9-10, 2008, Life and Arts, p. 3.