A couple of months ago, the Wall Street Journal published a story by Alan Murray called “The End of Management,” which was excerpted from his book Essential Guide to Management. It’s an interesting discussion about the trials facing today’s corporate managers. Some of the issues mentioned in this article fit in with our current discussions about trying to manage in today’s world under some very difficult times.
Peter Drucker called management “the most important innovation of the 20th century.” The 20th century was driven by the successes of giant corporations such as GM, Ford and IBM. Each of these giants developed a model for business that has impacted every company during this last century. They include Henry Ford with his ideas of mass production and organizing the assembly floor; Alfred Sloan of GM with his models for management structure and organization; and Thomas Watson and his ideas on sales management at IBM. They were among the leading visionaries of the 20th century who helped create the managed corporation as the answer to the industrial age that brought luxury to the masses.
Murray’s premise is that recent years have not been about triumphs of the corporation but rather triumphs over the corporation, and that Jack Welch of GE might have been the last of the corporate builders.
Modern corporate leaders are making their mark by waging war on entrenched corporate hierarchies. Many of today’s corporations have become riddled with bureaucracies. Their managers are more concerned about self-preservation than responding to market forces. So, in fact, good managers become enemies of their own corporate structures. As a manger today you must be prepared to confront “gale-like market forces” from globalization, new technologies, new communication technologies, competition from places previously never heard from and new government regulations making some of our technologies totally obsolete.
Murray cites the overnight disappearance of Lehman Brothers and Bear Sterns and companies like Google and Twitter that spring up overnight. If market forces were truly allowed to play out, GM and Chrysler would likely also be on the dinosaur list. The advance of technology is so swift. Murray uses as an example that it took radio 38 years to reach an audience of 50 million listeners. But television reached that in 13 years, the iPod in three years and Facebook in two years. Changes in our industry are not quite that rapid, but our technologies have seen enormous change over the last 35 years, which were driven in many cases by fuel costs and environmental concerns.
More on this subject next time.
