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Old road, new direction

Ability of businesses to manage innovatively is critical to the successful development of a knowledge-based economy, says Suresh Raina.

Ability of businesses to manage innovatively is critical to the successful development of a knowledge-based economy, says Suresh Raina.

Modern management owes its origin to the original thinkers including Max Webber, Taylor, Deming, Drucker and others. It was invented to solve the inefficiency that had crept in the production systems. Businesses were moving away from the traditional artisanship and attaining size and scale due to mechanisation. More people were now working in factories. Managing workers to deliver higher production efficiently had become critical.

Traditional management model advocates tight oversight, rigid planning, strict policies and procedures, appraisals and assessments, basically highlighting the old management school principle, “Management knows best”. This helps in managing more people but does not support creative passion of employees. Peter Drucker changed the game. He coined the term ‘knowledge worker’. This was radically different from the orthodox way of managing that most people believed in, thus leading to a conflicting scenario.

The world is changing rapidly. Economies have seen explosive growth and sudden contractions especially during the past two decades. The moot question now is how organisations will manage the business in future. How will they manage talent and performance, and run strategy.

Innovation is now the buzz word- whether it is from product or process innovation. So why not have management innovation? Management innovation focuses on the way the working of an organisation may be enhanced by relooking at the way the managers hire, lead and work with people.

From a people perspective, one needs to identify the capabilities that contribute to management success. In his book “Future of Management”, Gary Hamel has identified the attributes along with the percentage contribution they make to the success of the organization:
a) Obedience: Ability to take instructions and follow them.
Contribution: Almost nothing as it is a given and does not contribute much.

b) Diligence: Not taking short cuts, following the process
Contribution: 5%

c) Knowledge and intellect: We are living in a knowledge economy where access to knowledge is no longer significant. So it is rather the ability to understand the task at hand and to execute the same is what is crucial. Improving the skills continuously and willingness to borrow best practices, is also important.
Contribution: 15%

d) Initiative: Seeking out new challenges, taking up the task and finishing it without being told and followed is vital.
Contribution: 20%

e) Creativity: Inquisitive and not afraid to ask even seemingly stupid questions. They are always open to new ideas and nurture the imagination that brings new products and services to the public.
Contribution: 25%

f) Passion: This is most significant and helps people translate intent into accomplishment. This is extremely contagious and turns crusades into mass movements.
Contribution: 35%

While management has traditionally extracted obedience & diligence from employees easily, the same cannot be said about creativity and passion. The latter, which are the most valued attributes are demonstrably the least manageable, but challenge the role of the management. How do you get the most from your teams especially in the knowledge economy? Be it a software company or a large manufacturing organisation, a healthcare business or a bank, management innovation leads us to the thought that people do not need more managing. It actually means managing them less. It implies less order, less monitoring and review but more space and freedom, and more responsibility and accountability. This also means the need for less management and fewer managers.

Traditional management depends on hierarchical models that managing large teams effectively but is not good at mobilising effort from a large pool of resources. The more the management meddles in the day to day operations, the less freedom the employees enjoy. This impacts their passion to perform. Research has proven that people get excited when asked to choose their work. Their passion and ownership get reduced when jobs are assigned.

Management innovation makes employees more creative and more involved in decision making. It encourages them to design their own jobs and execute it with greater discretion. An emotionally charged speech by the CEO in an offsite can bring a high, but this adrenalin rush is transitory and short lived. An annual offsite unfortunately cannot build creativity and purpose.

Can you dream of creating an iPhone product without the passion of Steve Jobs and bring the blockbuster Heart Pacemaker that helps save thousands of lives without the moral compass of the scientists at Medtronic? And can you become the default Google search engine without the motto “do no evil”. The common theme therefore is that it is only a mission that ignites the passion of the people to help converge as a community.

Management must grow out of genuine sense of mission and authentic purpose. The attributes that turned men into crusaders emerged from their hearts, leading to extraordinary accomplishments. Unfortunately our current management language replaces all this by profit, market share, strategy, budget, process, quality, planning etc. First and the foremost we need to bring the heart back into the organisation, build a community and weave purpose and mission into the day to day operations.

The next step would be to formulate the vision that will fire the dedication and imagination of the employees. The management should to broaden the scope of employee freedom by managing less without sacrificing focus, discipline and order. The organisation should be more like a community rather than a bureaucracy. The team should perform with a sense of mission that will not only justify extraordinary contribution but also manage the chaos that it follows. For, on only the teams that are bound by a common cause will remain unfazed by the challenges of a continuously changing business environment. And as they are led by a sense of community and not a bureaucracy, will win this round.

The author is Senior Partner, Hunt Partners-India, executive search firm

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