More Management Misconceptions

Tom Peters

Last week I sounded off about some current management and economic misconceptions that are causing us harm. But I’m not through. Here are three more.

*Americans fight on the global economic playing field with one hand tied behind our back. I don’t recall a discussion about the levelness of competitive playing fields, like the one raging today, taking place during the two decades following World War II. Did our multinational chieftains, who were making hay in Europe in the ’50s and early ’60s, insistently remind their shareholders that the companies’ success stemmed mostly from the competition’s flattened industrial base?

Do we acknowledge that our leading position in most high-technology spheres is a direct result of the honor we heap (and have long heaped) upon men and women who dare to become entrepreneurs? Both the Europeans, especially the Germans and the French, and the Japanese scorn those who choose such a path. And if the trade balance tips our way once again, will we, in the spirit of levelness for all, accede to calls by the Japanese or Germans to clamp down on our entrepreneurs?

Economic playing fields are never level, especially in the short term. Any nation’s competitiveness, over the long haul, is determined principally by micro-economic doings, not by macro-economic policy. That is, the will and skill of our workforce—managers and non-managers—is ultimately the deciding factor. So boos and hisses to members of Congress who voted to ignore hard micro-economic truths, and attempt to level the playing field via the most protectionist trade bill in 60 years.

*Leadership is principally a matter of competence. In 1981, when Ronald Reagan replaced Jimmy Carter as our nation’s chief executive, charisma was in and competence was out. Now, in the wake of Iran-gate, the sleaze factor, et al., charisma is out and competence is in, as the battle of the bland (Bush vs. Dukakis) gets under way.

I’ve long argued for hands-on management. Moreover, I find President Reagan’s detachment of grave concern. That is, I am a staunch supporter of competence and in-touch leadership.

Nonetheless, I believe that effective leadership—in a six-person accounting office, an elementary school, a computer factory, or a nation—is largely a function of the chief’s vitality, willingness to empower others, and skill at exciting individuals about their own and their group’s purposes.

In business, the supreme strategist, who can dissect markets the way a chess master can evaluate his next five moves, is a precious commodity. But the chess master need only out-think his opponent. Once he decides to make a move, physically shifting the piece follows automatically.

Not so for the leader of any organization. His or her rooks, knights, and pawns must be inspired—and then inspired all over again tomorrow—if world-class quality and continuous improvement are to be the everyday result.

Hats off to competence. It’s vitally important. But competence alone doesn’t explain the preponderance of the difference between winners and losers among leaders—in business or the political arena.

*Participation (as in participative management) applies some but not all of the time. This statement was made recently by a senior executive of a large consumer-durables firm. He explained that there are occasions when there is no time to discuss things. At those times, he pointed out, the boss must tell people what to do. Scholars, studying what’s called “contingency theory,” have made similar utterances—arguing that certain “styles,” varying from participative to autocratic, are demanded by differing circumstances.

Baloney! The issue concerning participation (that is, involvement by everyone in the organization on a continuous basis) is analogous to my worries about our approach to quality, discussed in last week’s column. That is, you are either on board all the time, or you’re not on board at all.

You may recall my discussion, a few months ago, of the management styles of Pat Carrigan (who runs General Motors’ successful Bay City, Michigan, auto components plant) and of Ralph Stayer and his titleless executive team (who have fashioned such a remarkable record at Johnsonville Foods in Sheboygan, Wisconsin). Carrigan asserted that, in crafting her dramatic turnaround, she had never made a single decision by herself. Instead, though she acknowledged the right to decide, she prefers always to allow a consensus to emerge from discussions with all those who would be affected by a decision. Likewise, one of Stayer’s plant managers (labeled a “coordinator”) insisted that he had never overturned a decision, including hiring and firing, by any of the plant’s self-managing work teams.

The Bay City and Johnsonville leaders are tough as nails—participative, but by no means permissive. Like other successful participative managers, they are “results fanatics,” setting—and then living up to—unimaginably high standards. Most important, they are not part-time participative managers. They understand that continuous improvement and spirited performance are a result of full-time, not sometimes, involvement.

The misconceptions I’ve discussed this week and last have irked me for a long time. You’ll hear more about each one from me again. But think about holding onto these past two columns and re-reading them now and again. I’ve been blunt, because these topics are vital and demand no mincing of words. But mince we do—and all too regularly, I’m afraid.