Monday, April 11, 2011

"Do you know what 'synergy' is?"

The orientation for my first corporate job included a one-day ropes course. As an old country boy, I had spent much of boyhood in the tops of trees and had gone on to try some rock-climbing and repelling, so spending a spring day in the woods climbing towers was like being thrown back into the briar patch after four days of paperwork and jargon.

We were not, however, far enough from civilization to completely escape the business-speak. The medium in this case was a cheerful and bouncy instructor ('bouncy' in the literal sense -- she gave her entire memorized spiel springing from spot to spot on the balls of her feet).

With barely contained excitement she described the wonders of synergy, then asked, "Do you know what 'synergy' is?" Before anyone could answer, she continued, "It's centered energy."

[pause for comic effect]

Of the billions of dollars that corporations spend on consulting, training and motivation, a large chunk goes to what can only be described as scams. Collections of buzzwords, pseudo-science, faulty statistics and unsupportable claims that wouldn't fool the greenest mark are sold for astounding sums to CEOs who then make these programs central pillars of corporate culture.

It's difficult to estimate the true costs of these scams. The direct costs are not trivial but they are still probably smaller than what you get when you add up:

1. The opportunity costs of all these MBAs not studying something more useful;

2. The loss in productivity resulting from promotions and layoffs based partly on employees' ability to enthusiastically accept (or pretend to accept) absurd statements and claims;

3. The dangers of group-think (most of these programs emphasize teamwork, shared visions and positive attitude. This does not produce a conducive atmosphere for pointing out that the emperor has no clothes);

4. The influence these theories have had on non-corporate areas like education reform and policy making (where do you think the Bush administration got that make-your-own-reality stuff, not to mention those creepy backrubs?).

Along these lines, I recently came across this thoughtful 2006 article by Matthew Stewart, a former management consultant whose view of the field is, in some ways, darker than mine (thanks to Mike for the link). I've picked out a couple of interesting passages though you should really read the whole thing if you have the time.
The thing that makes modern management theory so painful to read isn’t usually the dearth of reliable empirical data. It’s that maddening papal infallibility. Oh sure, there are a few pearls of insight, and one or two stories about hero-CEOs that can hook you like bad popcorn. But the rest is just inane. Those who looked for the true meaning of “business process re-engineering,” the most overtly Taylorist of recent management fads, were ultimately rewarded with such gems of vacuity as “BPR is taking a blank sheet of paper to your business!” and “BPR means re-thinking everything, everything!”

Each new fad calls attention to one virtue or another—first it’s efficiency, then quality, next it’s customer satisfaction, then supplier satisfaction, then self-satisfaction, and finally, at some point, it’s efficiency all over again. If it’s reminiscent of the kind of toothless wisdom offered in self-help literature, that’s because management theory is mostly a subgenre of self-help. Which isn’t to say it’s completely useless. But just as most people are able to lead fulfilling lives without consulting Deepak Chopra, most managers can probably spare themselves an education in management theory.


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 ├╝ber-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.

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