The Great Management Paradox – Solved

One of the greatest ironies of current, early 21st Century management seems to be that, at the very time management are recognising the value of their people and their contribution to organisational success – and so are increasingly focused on introducing policies and procedures to win “hearts and minds” and engender greater employee loyalty – the more disengaged people appear to be becoming.   

The recently published Towers-Perrin 2007 Global Workforce Study, based on a survey of 90,000 workers in 18 countries and input from a database of more than 2 million people in 40 countries throughout the world, reveals that only 21% of the world’s workforce are ‘engaged’ in their work, when engagement means “freely giving their time, energy, creativity and knowledge to their work.” The survey also reveals that of the balance 41% are ‘enrolled’, (something colleagues and I used to refer to jokingly as “on the payroll but not at work”) 30% are ‘disenchanted’ and 8% ‘disengaged.’ Turn this around and it tells you that 79% (86% in the UK) of the organisation’s greatest asset and primary source of competitive advantage is not pulling its weight.

Yet this is at a time where management is more employee friendly and ‘liberal’ than at any time in history, increasingly focussed on the ‘soft skills’; aware of the need for ‘employer branding’ and endeavouring to create it by implementing policies that encourage ‘work-life balance’, offer flexible ‘cafeteria’ benefits, ‘home-working’ and ‘job-sharing’ etc.

This change is in fact the result of two very distinct, but mutually reinforcing forces. Firstly, the social advances of the past seventy years have resulted in a more democratised workforce that is more self-centred, less subordinate and so disinclined to tolerate being told what to do. Secondly the technological advances have increased the pace of operations to such an extent that the old ‘command and control’ style of management is no longer appropriate anyway.  Thus there would appear to be a natural convergence drawing the two together. So why is it not happening?

Ultimately, it boils down to a matter of trust. Although management is recognising this and doing its best to change, there is no instant mechanism for doing so, and thus – despite the best intentions – the greater inter-dependency of management and worker has still not been openly acknowledged: centuries-old mindsets continue to shape ingrained behaviours and attitudes and so perpetuate the historical conflicts and mistrust that exist between manager and worker. The workers still see manager’s role as to maximise efficiency and/or profits and that largely at their expense, and ultimately so too do managers. 

There is need for a whole new language to be developed to bring the two closer together to bridge this great divide. Let’s see how this could be done.

In a recently published book, “Mobilizing Minds,” McKinsey executives Lowell Bryan and Claudia Joyce argue that “profit-per-employee should now be the key business metric.” Yet, while undoubtedly making the case that people are a business’ most important asset, this metric remains rooted in traditional management thinking and will perpetuate the very confrontation that we are talking about. For example, if a business is making a profit of £1 million with a workforce of 100, the profit-per employee would be £10,000. So, if management, were to reduce the workforce by 10% the profit-per-employee would now be £11,111. Consequently, this would perpetuate the worker perception that they are expendable, further reduce employee loyalty  and continue the traditional worker/manager conflict, which would be further reinforced and exacerbated if this was a KPI and management incentives were dependent on it.

On the other hand if workers were valued as assets, the KPI would be ‘Return on Human Assets.’ While ultimately no less meaningful or useful, this would engender greater co-operation between worker and manager, with both endeavouring to maximise the individual contribution.  Not only would this eradicate the centuries-old conflict but it would provide the catalyst needed to change the forces shaping behaviour. It would eliminate the paradox and build a basis for a more efficient organisation with happier, more engaged employees.