Chapter I An introduction to managing people in changing contexts American attitude to co-determination during the period varied between early accept ance-it wouldn't work in America,but was perhaps good for Germany-to outright opposition.However,what became the official American line was that German business would lose control of its affairs,and thus the essential and inalienable rights of stock- holders would be violated.Such opposition by the US to German attempts to reintroduce co-determination was exemplified by the role played by General Lucius Clay,leader of the occupying US administration,who obstructed and vetoed the rights of individual German states(the Lander)to pass such legislation for as long as he was able.Though over time,American opposition to the rights of the German government to establish co- determination diminished,the business press and major figures in the US business com munity continued to see such legislation as an attempt to establish socialism in capitalist industry.To the extent that these people had influence over American aid through the Marshall plan to German industry,German managers were perceived to be playing a dan- gerous game,but continued to do so nevertheless.In this important sense,US attempts to impose on Germany a US-style 'best practice'and a way of managing failed:'German entrepreneurs rejected American managerialism'(Locke,1996,p.64) Source.based on Locke,1996. We can see from the above example that the universalistic view on best practice in management has not always found favour with man- agers outside the USA.Similarly,not everyone in the not-for-profit public or voluntary sectors of modern economies would agree that best increasing the value of shareholders in the business.Instead,we are beginning to witness an increasingly influential relativist view among management academics and practitioners(Whittington,2000) Key concept:Relativism in management Relativism expresses the idea that it is not possible to establish a set of universal truths con cerning principles,values and morals about management that will not at some later time be abandoned and replaced by another set of truths.Relativism in management is often associated with the idea that management practices and values cannot be abstracted from the context in which thev were produced and easily transferred to other contexts Extreme versions of relativism in management hold that there is no such thing as reality certainty or'social facts',and that all views about management are essentially value judge ments.The principle aim of relativists in management is to give less powerful people and groups a greater voice in public discourse about how they should be managed
We can see from the above example that the universalistic view on best practice in management has not always found favour with managers outside the USA. Similarly, not everyone in the not-for-profit public or voluntary sectors of modern economies would agree that best practice developed in the for-profit, private sector is superior or transferable to contexts that are not subject to the overarching goal of increasing the value of shareholders in the business. Instead, we are beginning to witness an increasingly influential relativist view among management academics and practitioners (Whittington, 2000). Chapter 1 An introduction to managing people in changing contexts 7 American attitude to co-determination during the period varied between early acceptance – it wouldn’t work in America, but was perhaps good for Germany – to outright opposition. However, what became the official American line was that German business would lose control of its affairs, and thus the essential and inalienable rights of stockholders would be violated. Such opposition by the US to German attempts to reintroduce co-determination was exemplified by the role played by General Lucius Clay, leader of the occupying US administration, who obstructed and vetoed the rights of individual German states (the Länder) to pass such legislation for as long as he was able. Though, over time, American opposition to the rights of the German government to establish codetermination diminished, the business press and major figures in the US business community continued to see such legislation as an attempt to establish socialism in capitalist industry. To the extent that these people had influence over American aid through the Marshall plan to German industry, German managers were perceived to be playing a dangerous game, but continued to do so nevertheless. In this important sense, US attempts to impose on Germany a US-style ‘best practice’ and a way of managing failed: ‘German entrepreneurs rejected American managerialism’ (Locke, 1996, p. 64). Source: based on Locke, 1996. Key concept: Relativism in management Relativism expresses the idea that it is not possible to establish a set of universal truths concerning principles, values and morals about management that will not at some later time be abandoned and replaced by another set of truths. Relativism in management is often associated with the idea that management practices and values cannot be abstracted from the context in which they were produced and easily transferred to other contexts. Extreme versions of relativism in management hold that there is no such thing as reality, certainty or ‘social facts’, and that all views about management are essentially value judgements. The principle aim of relativists in management is to give less powerful people and groups a greater voice in public discourse about how they should be managed
Managing people and organizations in changing contexts For example,the practice of management in France is sometime quite different from the practice of management in the USA because of the relatively unique nature of the French business sector,its history,its national cultural characteristics and institutional (legal,social,educa tional and political)norms (Lawrence,2002).Thus,managers brought up in the French business system literally see through different eyes and ears to American managers,and are sometimes not able to understane each other,even if they both use a version of American English.French business management is reputed to be hierarchical and individualist in nature,and was unable to accommodate the bottom-up,group decision making of quality circles,one of the fashionable techniques adopted by many global companies in the 1980s.Another example of a relativist per spective that is influential in management is the so-called constructivis approach to learning which we shall discuss more fully in a later chapter this book.The constructivist approach to learning is often contrasted with a cognitive or'schooled'learning approach,in which abstract prin ciples are taught to students in a classroom,as is often the case in many management courses.Constructivists argue that we learn most effective ly through active participation rather than as a passive recipient in which knowledge is 'poured'into our heads through instruction in a class room.However,when we engage in active learning,all such knowledge becomes personal to us.So,for example,my knowledge and under- standing of what I am writing will be different from yours as an individ- ual reader of this text,and it will also be different from that of others who read the same text.But,since all knowledge is personal and sub jective,and not something that is literally 'out there'and ready to be grabbed like an apple on a tree,it is mainly tacit(in people's heads and hands)and highly specific to the context in which it is produced.Seen in this way,management is best viewed as a craft learned in context rather than as an abstract science (Mintzberg.2004).So.learning to become a manager is most effectively undertaken by serving a long,on- thejob'apprenticeship',often as part of a'community of practitioners in a particular industry or company (Wenger.1998). My position on this debate between extreme versions of universalism and relativism is somewhere in between the two,often depending on the context of application.Clearly,ideas about management devel- oped in one situation can take root in other contexts.For example,the popularity of the MBA as a global form of management education would be unsustainable if this were not possible.Moreover,the success of multinational companies rests in part on their ability to transfer learning in one part of the world to another,often in the form of model practices and values.However,the perspective taken in this
For example, the practice of management in France is sometimes quite different from the practice of management in the USA because of the relatively unique nature of the French business sector, its history, its national cultural characteristics and institutional (legal, social, educational and political) norms (Lawrence, 2002). Thus, managers brought up in the French business system literally see through different eyes and ears to American managers, and are sometimes not able to understand each other, even if they both use a version of American English. French business management is reputed to be hierarchical and individualist in nature, and was unable to accommodate the bottom-up, group decisionmaking of quality circles, one of the fashionable techniques adopted by many global companies in the 1980s. Another example of a relativist perspective that is influential in management is the so-called constructivist approach to learning, which we shall discuss more fully in a later chapter in this book. The constructivist approach to learning is often contrasted with a cognitive or ‘schooled’ learning approach, in which abstract principles are taught to students in a classroom, as is often the case in many management courses. Constructivists argue that we learn most effectively through active participation rather than as a passive recipient in which knowledge is ‘poured’ into our heads through instruction in a classroom. However, when we engage in active learning, all such knowledge becomes personal to us. So, for example, my knowledge and understanding of what I am writing will be different from yours as an individual reader of this text, and it will also be different from that of others who read the same text. But, since all knowledge is personal and subjective, and not something that is literally ‘out there’ and ready to be grabbed like an apple on a tree, it is mainly tacit (in people’s heads and hands) and highly specific to the context in which it is produced. Seen in this way, management is best viewed as a craft learned in context rather than as an abstract science (Mintzberg, 2004). So, learning to become a manager is most effectively undertaken by serving a long, onthe-job ‘apprenticeship’, often as part of a ‘community of practitioners’ in a particular industry or company (Wenger, 1998). My position on this debate between extreme versions of universalism and relativism is somewhere in between the two, often depending on the context of application. Clearly, ideas about management developed in one situation can take root in other contexts. For example, the popularity of the MBA as a global form of management education would be unsustainable if this were not possible. Moreover, the success of multinational companies rests in part on their ability to transfer learning in one part of the world to another, often in the form of model practices and values. However, the perspective taken in this 8 Managing people and organizations in changing contexts
Chapter I An introduction to managing people in changing contexts book is more relativist in the sense that context and individual inter- pretation of ideas are seen as very important in influencing action. Perhaps this is best explained by an organic,gardening metaphor According to John Seely Brown (2000),an eminent American aca- demic,transferring so-called best practices from one context to anoth- er is like uprooting a tree from the fertile soil that gave it life and its particular form or shape and attempting to replant it into a different kind of soil,the properties of which are unknown or at least partially uncertain.It is unlikely that one can know with any certainty in advance the kind of tree,or anything resembling the original tree,that the soil and microclimate will produce.Thus,at best,the status of such best practices can be described as 'promising (Leseure et al.2004) but they are fraught with problems of becoming embedded into his- torically,culturally and institutionally different contexts(Zhang and Martin,2003).This transfer problem applies equally to industrial con- texts,such as the transfer of private sector practices to the highly politi- cized public sectors of healthcare,education and local government To return to the first of our two questions,concerning the possibility of a one-best-way of doing things or set of best practices in manage ment,my answer is a qualified yes and no.A 'yes'relates to the con tention that there is a body of knowledge about management that we can legitimately teach and use in many different contexts,even though that body of knowledge has been developed for the most part in the USA and was founded on a private sector,market-driven model.'No is an answer because there are no 'magic bullets'nor a'one-best-way Our knowledge and practices should enjoy the status of no more than 'promising',and we have to think deeply and sensitively when applying these in different contexts,whether these are national cultural,indus trial or company settings. Stability and change in models of management Key features of models of management If context is an important theme in recent management literature,a second key theme concerns the nature of change and stability in models and theories of management and their acceptance by managers.Like many relatively immature bodies of knowledge,the study and practice of management is no exception to the influence of fashionable or
book is more relativist in the sense that context and individual interpretation of ideas are seen as very important in influencing action. Perhaps this is best explained by an organic, gardening metaphor. According to John Seely Brown (2000), an eminent American academic, transferring so-called best practices from one context to another is like uprooting a tree from the fertile soil that gave it life and its particular form or shape and attempting to replant it into a different kind of soil, the properties of which are unknown or at least partially uncertain. It is unlikely that one can know with any certainty in advance the kind of tree, or anything resembling the original tree, that the soil and microclimate will produce. Thus, at best, the status of such best practices can be described as ‘promising’ (Leseure et al., 2004), but they are fraught with problems of becoming embedded into historically, culturally and institutionally different contexts (Zhang and Martin, 2003). This transfer problem applies equally to industrial contexts, such as the transfer of private sector practices to the highly politicized public sectors of healthcare, education and local government. To return to the first of our two questions, concerning the possibility of a one-best-way of doing things or set of best practices in management, my answer is a qualified yes and no. A ‘yes’ relates to the contention that there is a body of knowledge about management that we can legitimately teach and use in many different contexts, even though that body of knowledge has been developed for the most part in the USA and was founded on a private sector, market-driven model. ‘No’ is an answer because there are no ‘magic bullets’ nor a ‘one-best-way’. Our knowledge and practices should enjoy the status of no more than ‘promising’, and we have to think deeply and sensitively when applying these in different contexts, whether these are national cultural, industrial or company settings. Stability and change in models of management Key features of models of management If context is an important theme in recent management literature, a second key theme concerns the nature of change and stability in models and theories of management and their acceptance by managers. Like many relatively immature bodies of knowledge, the study and practice of management is no exception to the influence of fashionable or Chapter 1 An introduction to managing people in changing contexts 9
10 Managing people and organizations in changing contexts faddish ideas,with change being a recurrent theme in the literature and the new 'big'idea being promoted every few years. However,as some writers have pointed out,the debates over what constitutes the best way to manage show a remarkable stability over time,especially with regard to the choices among available models and theories.These models are often said to resemble paradigms,a scien- tific word referring to the existence of particular kinds of worldview which comprise a relatively coherent set of theories,metaphors and practices.Paradigms are also notable for being relatively stable in a particular scientific community for many years until the next 'big idea is developed around which a competing paradigm forms. In business and management,the term'paradigm'tends to be used a little more loosely(Clarke and Clegg,1998),often describing a set of assumptions and values about how the organizational world works and how it should work,which we might describe as a mindset(Morgan 1997).This is rather different from the way in which the term was orig- inally intended to be used in describing a set of coherent and explicit theories about what scientists were studying.Most managers operate and adhere to particular mindsets,even though they are unable to articulate the assumptions and theories underlying them. There are at least three important points about mindsets.First,they are simultaneously useful and limiting,since a way of seeing is also a way of not seeing.Second,seeing the world through particular mind- sets may lock us into our own 'psychic prison'(Morgan,1997)and result in self-perpetuation of old ideas and managerial regimes.Self- perpetuation can be a force for stability,but it can also prevent or con- strain much-needed change.For example,Richard Pascale (1999)has claimed that'nothing fails like success'.He has argued that success is based on becoming highly attuned to,and skilled in,managing and organizing in one set of competitive circumstances.However,if and when these circumstances change,we are often unable to change our mindsets rapidly enough to produce the appropriate responses.Third it forces managers to reflect critically on their mindsets to produce the kind of change that is needed in modern organizations. These three points have given rise to what is probably the major debate in management theory over the last century between mecha- nistic forms of organization,characterized by 'top-down'modes of control,and organic forms of organization,characterized by'bottom- up'modes of control,human relations principles and the attempts to ).to
faddish ideas, with change being a recurrent theme in the literature, and the new ‘big’ idea being promoted every few years. However, as some writers have pointed out, the debates over what constitutes the best way to manage show a remarkable stability over time, especially with regard to the choices among available models and theories. These models are often said to resemble paradigms, a scientific word referring to the existence of particular kinds of worldview, which comprise a relatively coherent set of theories, metaphors and practices. Paradigms are also notable for being relatively stable in a particular scientific community for many years until the next ‘big idea’ is developed around which a competing paradigm forms. In business and management, the term ‘paradigm’ tends to be used a little more loosely (Clarke and Clegg, 1998), often describing a set of assumptions and values about how the organizational world works and how it should work, which we might describe as a mindset (Morgan, 1997). This is rather different from the way in which the term was originally intended to be used in describing a set of coherent and explicit theories about what scientists were studying. Most managers operate and adhere to particular mindsets, even though they are unable to articulate the assumptions and theories underlying them. There are at least three important points about mindsets. First, they are simultaneously useful and limiting, since a way of seeing is also a way of not seeing. Second, seeing the world through particular mindsets may lock us into our own ‘psychic prison’ (Morgan, 1997) and result in self-perpetuation of old ideas and managerial regimes. Selfperpetuation can be a force for stability, but it can also prevent or constrain much-needed change. For example, Richard Pascale (1999) has claimed that ‘nothing fails like success’. He has argued that success is based on becoming highly attuned to, and skilled in, managing and organizing in one set of competitive circumstances. However, if and when these circumstances change, we are often unable to change our mindsets rapidly enough to produce the appropriate responses. Third, it forces managers to reflect critically on their mindsets to produce the kind of change that is needed in modern organizations. These three points have given rise to what is probably the major debate in management theory over the last century between mechanistic forms of organization, characterized by ‘top-down’ modes of control, and organic forms of organization, characterized by ‘bottomup’ modes of control, human relations principles and the attempts to engineer strong organizational cultures (Hoopes, 2003), issues to which we shall return in this book. 10 Managing people and organizations in changing contexts
Chapter l An introduction to managing people in changing contexts I川 The mechanistic mindset Many managers see their ideal organization as a well-oiled machine,in which everyone and everything is treated as a replaceable part.In such 'machines'.predictability and control are the most important design features and are frequently accompanied by hierarchical organization structures.Not unnaturally.this view serves the interests of managers who advocate such a perspective,since the people who are most impor- tant in machine-like organizations are the designers and planners(i.e the managers).Thus.managers who benefit from the machine view of organizations by running a 'smooth operation'tend to keep things that way.They do so by imposing their mindsets on others and by the kind of actions they take,such as recruiting,developing and promot- ing people with similar mindsets.Henry Mintzberg (1983)labelled these managers the 'technostructure'to capture their rational design and planning mindsets and characteristics. This machine view of organizations is not in and of itself a problem since classical machine-like organizations.such as public sector bureaucracies and armies,usually work well in stable and predictable circumstances- for example,in state-run,planned economies or dur- ing conventional warfare.However,if the circumstances change-for example,if economies suddenly become open to market circum stances,as happened in the former Soviet bloc,or if warfare becomes unconventional,as is the case with the 'war against terror'-machine like organizations often lack the intelligent capacity to take action themselves to adapt to these changing environments.This inability to adapt is a direct consequence of the mindsets and actions of machine- like minds,and of the vested interests of those who are in control. Beyond the mechanistic mindset This machine view of organizations dominated much managerial thinking and action until the 1970s,and in some cases continues to do so.For example,you cannot run a highly reliable organization such as a nuclear power station on anything other than machine-like princi- ples,for the most part at least.However,with the changes that occurred during the last few decades of the last century,it became increasingly obvious that old ways of seeing had to give way to new par adigms,based on the notion of open systems and the need for organi- zations to take into account their external environments.Thus,we began to see a mindset developing among managers of organizations
The mechanistic mindset Many managers see their ideal organization as a well-oiled machine, in which everyone and everything is treated as a replaceable part. In such ‘machines’, predictability and control are the most important design features and are frequently accompanied by hierarchical organization structures. Not unnaturally, this view serves the interests of managers who advocate such a perspective, since the people who are most important in machine-like organizations are the designers and planners (i.e. the managers). Thus, managers who benefit from the machine view of organizations by running a ‘smooth operation’ tend to keep things that way. They do so by imposing their mindsets on others and by the kind of actions they take, such as recruiting, developing and promoting people with similar mindsets. Henry Mintzberg (1983) labelled these managers the ‘technostructure’ to capture their rational design and planning mindsets and characteristics. This machine view of organizations is not in and of itself a problem, since classical machine-like organizations, such as public sector bureaucracies and armies, usually work well in stable and predictable circumstances – for example, in state-run, planned economies or during conventional warfare. However, if the circumstances change – for example, if economies suddenly become open to market circumstances, as happened in the former Soviet bloc, or if warfare becomes unconventional, as is the case with the ‘war against terror’ – machinelike organizations often lack the intelligent capacity to take action themselves to adapt to these changing environments. This inability to adapt is a direct consequence of the mindsets and actions of machinelike minds, and of the vested interests of those who are in control. Beyond the mechanistic mindset This machine view of organizations dominated much managerial thinking and action until the 1970s, and in some cases continues to do so. For example, you cannot run a highly reliable organization such as a nuclear power station on anything other than machine-like principles, for the most part at least. However, with the changes that occurred during the last few decades of the last century, it became increasingly obvious that old ways of seeing had to give way to new paradigms, based on the notion of open systems and the need for organizations to take into account their external environments. Thus, we began to see a mindset developing among managers of organizations Chapter 1 An introduction to managing people in changing contexts 11