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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
This book discusses the evolution of management as a profession over the past two decades and how it continues to evolve. It goes on to describe the new style of management and makes recommendations for what today’s and tomorrow’s managers must know and how to work.
- Offers ways to think about your role as a manager in order to optimize your effectiveness toward uncertain and turbulent changes
- Discusses current realities in which management currently operates
- Provides a historical background of managerial practices and how they’ve evolved in the present workplace
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Seitenzahl: 496
Veröffentlichungsjahr: 2014
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CONTENTS
Cover
Series page
Title page
Copyright page
Preface
Key Ideas of the Book
The Audience for This Book
The Mega Trends Affecting Management
How This Book Is Organized
Writing, Like Management, Is a Team Sport
Chapter 1: Emergence of a New Managerial Style
How This Book and Chapters Are Organized and Why
A Dose of Historica l Perspective
Thinking in Terms of Systems and Processes
Simulations, Modeling, and the Attraction of Numeric Data
Migratory Habits of the Modern Manager
How the New Style Is Applied at Work
Implications for Management
Chapter 2: When Management Confronts Information Ecosystems
How Information Technology Changes Came About
How Managers Use Computing to Change Their Work
So What?
Changing Opportunities and Threats
Role of Knowledge Management, Innovation, and Corporate Culture
Why Industries Are Still So Important to Firms and Managers
What Economists and Other Academics Are Discovering
Information Technologies to Pay Attention to Right Now
Cloud Computing
Wearable Computing
Autonomous Vehicles
Biotech-Informatics-Information Technology
Quantum Computing
Personal Robotics
Management’s Takeaways
Chapter 3: How Technologies Affect the Work of Industries
What Is an Industry?
Behavior in an Industry-Centric World
Risks of Working Within an Industry
How IT Affects Industries and Shapes Their Strategies
Implications for Managers
Chapter 4: New Organizations
Changing Structure and Form of Organizations
Transforming Large Enterprises
Special Role of Human Relations in the Transformation of Corporations
Special Role of Financial and Accounting Functions
Portrait of the New Manager
Migrations of Profit and Value
What Does Not Seem to Be Changing
Challenges Ahead
Implications for the Future of Management
Chapter 5: Emerging Economic and Business Realities
“Nuts and Bolts” of the Globalized Connected Economy
How Governments Use IT for National Economic Development
A View into the Economic Future
Implications for Management
Chapter 6: The Way Forward
A Brief Summary of This Book’s Key Advice
A Global Society and Its Implications for Management
Information, Information Technologies, and the Work of Management
Organizational Level: Strategy and Deployment
The New Militancy of Impatient Powerful Customers
Return on Information—A New Idea for a New Time?
What Personal Skills and Knowledge Does a Manager Need?
Some Final Thoughts
For Further Reading
Index
End User License Agreement
List of Tables
Chapter 03
Table 3.1 McGahan industry trajectories
Chapter 04
Table 4.1 Examples of globalwide operational initiatives
Table 4.2 IBM’s globalized processes, circa 2010
Table 4.3 Sample of evolving features of corporations
Table 4.4 Gerald Greenwald’s “Rules of the Road” for management
Table 4.5 How chief information officers ranked problems they faced as business leaders, 2006, percent ranking an issue as their number one barrier from making them influence business decisions
Chapter 05
Table 5.1 Pace of introduction of consumer goods in the United States, 1890–2007
Table 5.2 Economic ecosystem of an advanced economy, 2001–2006
Table 5.3 Economic development strategies for most advanced and rapidly advancing nations
Chapter 06
Table 6.1 Key “Takeaways” by chapter
List of Illustrations
Chapter 01
Figure 1.1 Model of a supply chain.
Chapter 03
Figure 3.1 Industry collaboration.
Figure 3.2 Industry behavioral characteristics.
Figure 3.3 Management considerations within an industry.
Chapter 05
Figure 5.1 Rise in U.S. manufacturing productivity, 1987–2005.
Figure 5.2 World trade growth.
Figure 5.3 Average tariff levels.
All products, unweighted average most favored nation tariff, %, 1989–2005.
Figure 5.4 U.S. freight—volume growth, cost efficiency, 1992–2005. Note: Price hikes in 2004–2006 were probably due to surge in petroleum-based fuels.
Figure 5.5 Rapidly advancing to the frontier.
Internet usage (%) for select countries, 2000 and 2007.
Figure 5.6 Share of increase in Internet users. By region, 2000–2007.
Figure 5.7 Global GDP history and projects, 1990–2025.
Guide
Cover
Table of Contents
Begin Reading
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IEEE Press Editorial Board
Tariq Samad, Editor in Chief
George W. Arnold
Dmitry Goldgof
Ekram Hossain
Mary Lanzerotti
Pui-In Mak
Ray Perez
Linda Shafer
Mengchu Zhou
George Zobrist
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The Essential Manager
How to Thrive in the Global Information Jungle
James W. Cortada
Copyright © 2015 by the IEEE Computer Society. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.Published simultaneously in Canada.
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Library of Congress Cataloging-in-Publication Data:
Cortada, James W. The essential manager : how to thrive in the global information jungle / James W. Cortada. pages cm Includes bibliographical references and index.
ISBN 978-1-119-00277-2 (pbk.)1. Management. 2. Information technology–Management. 3. Executive ability. I. Title. HD31.C644749 2015 658–dc23
2014025846
Preface
The work of managers worldwide has been undergoing significant transformation over the past three decades, in fact, changing more rapidly today than in earlier years. Their activities are being shaped by the influences of intensified, yet also localizing, global trade, use of ever-tightly integrated international supply chains, and even more by their extensive reliance on information technologies (IT) in myriad activities. The combination of evolving economic globalization and the cumulative effects of so much infusion of digital technologies and telecommunications into their enterprises has led to so many substantive changes in how managers work that today we can speak of a new style of managerial practices. That new style is also being influenced by human behavior and various values of societies and businesses from one part of the world to another. The recognition of this new style of management separates this book from the thousands of published declarations that everything is or has changed. It is also a rough jungle because so many players in so many countries and cultures are involved in the game.
Let’s be blunt about the matter. Many managers, if not most, are poorly equipped to succeed in the years to come because their knowledge base is too narrow and the environment they must operate is becoming too complex. They are fed insights and facts on ever-narrower topics at work, through business publications, and often at school and university. I argue that their world is becoming so complex and so serious that they need to broaden their appreciation for how business is evolving in ways that are not normally considered. How they should come to better understand the world around them and how to succeed in it is the reason for this book. Put more formally, the primary objective of this book is to make readers—primarily managers—aware of the critical features of the evolving workplace in which they must succeed. A second objective is to define many of the behavioral attributes managers need to thrive in the evolving environment described in this book. Get ready to explore a great many topics normally not pulled together within the covers of a single book. But, don’t expect detailed case studies or massive quantities of data, this book’s purpose is to point out the obvious issues you will need to wrestle with over time. Get ready also to have to constantly relearn and reboot your knowledge base. How?
This book achieves its objectives by addressing the accumulation of changes that have been underway for some time, and that are continuing to emerge, as part of a larger fundamental process of shaping modern management. Relying on history and observations of current trends, it describes the context in which we work and both obvious and some not-so obvious implications, making recommendations on how management should function. It also defines many elements of management that have not changed, despite the hype. Activities are occurring, despite cycles of prosperity and recession that simultaneously affect the global economy today. It offers you ways to think about your role as manager so that you can optimize your effectiveness in what many consider to be rather turbulent and uncertain changes in the profession of management.
In addition to describing the evolving nature of management, it makes recommendations in each chapter on what to do as a result of those events. If you are impatient for answers, go to Chapter 6, which summarizes them, but then go back and read the other chapters so you understand why. This book was intended to be brief in order to quickly understand my point. If you pay attention, you will dig deeper on those topics that resonate with you right now and, hopefully, you will continue to do that for the rest of your career.
Key Ideas of the Book
The transformations—what I am calling changes in managerial style—are characterized by such features as the extensive use of massive quantities of numerical data to inform decisions, modeling of options from such mundane things as budget options with a spreadsheet tool on a PC, use of social media, to deploying super computers to conduct R&D and model market performance. Their organizations have spread around the world, integrating enterprises together of various sizes and roles, creating what today we call extended supply chains, while flattening the hierarchical structures of ever-larger corporations and smaller ones competing globally. All of these events occurred, and continue to occur slowly and incrementally around the world, not just in those national economies known for their early or extensive use of computing, for example, or in the richest national economies.
I have elected to discuss those current realities in which management operates that are the most important in affecting the success of management today and in the next several decades. I use this method of describing emerging features and implications of their new style of work. I use the word “emerging” because that process is still unfolding. Neither you nor I have the time to consume a far larger book that is more comprehensive. As managers have to do, we need to practice cognitive triage because there is too much information and managerial advice “out there” for anyone to absorb. And that is one of the lessons for management today: acquire the skill to select what needs to be understood right now and at what level of detail. Let this book be an example of that practice at work.
My intention is not to write a history or a full description of the evolution of managerial practices, although many observations are set in historical context, because understanding what has happened so far is absolutely crucial for understanding changes underway today. So bear with me as I offer more history than you might want—I use history because too many managers do not have historical perspective for context. The work performed by management is becoming more cerebral and success more dependent on understanding the context in which they work that goes beyond the normal fare of economics, prices, competition, and business practices and that must now also include history, sociological issues, culture, and, of course, the ever-changing and expanding role of IT. Understanding the context of your reality must extend across economic, technological, and business realities at a minimum, and ideally if you can absorb it, the social values of your environment at home and abroad, inside and outside your company, and appreciate the behaviors that are the results of those dynamics. My approach is particularly essential for those who have to deal directly with the consequences of economic globalization, governmental and regulatory globalization, and, of course, with the fact that today many of their firms spend between 7 and 15% of their budgets on information processing technologies and telecommunications, which themselves have become embedded in every facet of their business and who have to train their managers (and their workforces at large) in new ways of working.
We also have to deal with the fundamental problem that corporations are not doing as well as portrayed in their annual reports. Cheap money, inflated stock values, and the mess whole industries created for themselves and others in 2007–2009 through their inability to deal with complex issues, such as real estate derivatives, all hint that managers have a serious set of problems facing them for years to come. In the United States, the banking world has had to pay penalties in excess of US$100 billion, in Europe managers are going to jail, in China corrupt corporate leaders have been executed, and so on. Dealing with complexity and hidden realities is serious business.
I argue that the transformation currently underway in how managers do their work has not, however, fundamentally altered their mission, the raison d’être for why we have managers in the first place. Scholars such as Peter Drucker, Alfred D. Chandler, Jr., Gerald Greenwald, Adam Brandenburger, Barry J. Nalebuff, and Rita Gunther McGrath spent their professional lives describing those missions; I have no reason to displace their good work. Rather, mine builds humbly on their efforts, and upon that of such others who have followed them, such as Don Tapscott and Laurence Prusak all conditioned by historical perspective, solid observations, always paying close attention to broader social and economic contexts, and not just traditional managerial practices. So this book links the information-influenced work of managers to fundamental changes in the economy, in which the further integration of global industries, markets, and national economies are themselves influencing the work of managers, the “visible hand” in an economy that Professor Chandler described so well.
The Audience for This Book
Bluntly put, it is today’s managers and those who aspire to be one. I speak directly to these communities, although with a tip of the hat to the academics and journalists who are helping to equip management with insights about running enterprises. This book is by and for managers about how our craft is evolving into a more structured profession at a time of enormous transition in global economics, political constructs, and technological transformations that extend beyond computing and telecommunications into many other fields. In short, they are working in a period of increased appreciation of the role of chaos in science and understanding of how people and societies function, and when businesses are entering a world potentially as different as the rise of the modern corporation itself in the late nineteenth century.
A diligent business school professor should recognize much that is in this book and, to a large extent, a competent MBA student should too, because so many had to have worked for several years before going to business graduate school. I need to remind both communities, however, that they make up only a tiny portion of the population of the world’s business managers. I look to the academics to provide elegant and useful paradigms and the detailed case studies that we managers find so valuable. But as a manager, my worldview looks up from the trenches in which even small mistakes harshly cost managers their jobs, where 50–60 hour weeks are all too normal, where job pressures change personalities and behaviors, and where customers expect so much.
The Mega Trends Affecting Management
This book explores mega trends and activities that I believe are changing the substance of managerial work:
Business practices/environments continue to evolve—they have not stabilized as some would argue—due in large part to all manner of information and telecommunications technologies that continue to enter economic/business life, various human values, and behaviors.
Managers are actually facing greater changes in the organization of their businesses than in the past and consequently are challenged to find new ways of managing their enterprises. Opportunities for novel sources of revenue and new sources of threats present themselves that cannot be ignored.
It is more than the story about the Internet—the Internet’s influence on business structures and opportunities are just barely beginning to be felt; everything so far has been minor in comparison to other effects of earlier uses of IT. We now face additional yet fundamental structural changes in industries and economies, not just firms.
The style of how management is conducted has moved sufficiently to new forms such that we can speak of evolving ways with which their daily work is done today when compared to how it was done even as recently as 20 years ago.
IT has become pervasive, much like process management became ubiquitous in the 1990s. But there is also a broad band of differences between corporate IT and consumer IT; both are often intermixed and confused by the press and observers. Each requires its own descriptions, strategies and, often, managerial practices. Selling or using iPods, iPads, LinkedIn, and Facebook is not the same as running a process driven by Enterprise Resource Management in manufacturing; the latter industry (manufacturing) still makes up roughly 27% of the World’s GDP.
This book identifies key inconsistencies in practice versus beliefs, such as the notion that knowing about the future direction of an industry causes managers to take different actions today; in fact, they do not until forced to by immediate circumstances.
Today over 60% of all major commercial deployments of IT are initiated and managed by non-IT management. In fact, there is hardly a CEO who has not led an IT project sometime in their recent career, such as an implementation of an SAP software package or some other large system. Because so many non-technical managers are now involved in IT managerial issues, the insights and experiences of chief information officers (CIOs) need to extend into line management. Many experts on business management have already published on how the insights and knowledge of line management have to be part of the CIO’s kit bag; this book takes the dialogue in the opposite direction, because of the pervasiveness of IT in the work of line management.
Because management as a body of practices is evolving into forms more suitable to an age in which networked firms and extensive use of IT pervades, a new style of management results across three dimensions: its causes, features, and resulting behavior. I use the term digital style in order to help move us away from a more manufacturing-centric (Fordist) model of earlier decades. I argue that we are already in a period of significant institutional (read business model, extended enterprise, etc.) transformation and deployment of IT that is extending beyond the deployment of the Internet, one moving toward a global technological and economic balance-of-power similar to that experienced generally by the world prior to modern times. I describe the way such a growing convergence of standards and economies of scale, among others, affect managerial behavior. This book is about today’s general management.
“Only” a third of the world’s human population uses the Internet today, so the lion’s share of the story is about other forms of IT and their effects on the work of managers, and so that “other” part of IT will receive the bulk of my attention. Another reality is that today more devices than people use the Internet. The Internet will not, however, be ignored since it is a crucial component of the connected world that is emerging, and that will engage at least twice as many people in the next decade than today. I emphasize the notion of entering because the real effects of the Internet thus still lie in the future, when compared to the effects of earlier waves of IT on enterprises and governments.
The title of this book is intended to call attention to a frame of reference I want to use throughout this book and that I encourage you to adopt as you go about the work of managing for the rest of your career. It is the notion that we work in an information ecosystem—call it a jungle if you wish—but nonetheless an environment that like a biological ecosystem has a lot going on that affects whatever else is occurring in the same place. It is an old idea that has occurred to earlier business writers but was premature and not so relevant until the Internet and other forms of IT made most industries and vast land masses accessible and manageable at scales impossible to achieve as recently as 20 years ago. Like a forest (or jungle), there are big animals (corporations and governments) and little ones (small companies and towns), big plants (a large national economy such as that of the United States), and others dependent on the shade of the larger ones (members of a large corporation’s supply chain). This ecosystem is one filled with information—data and insights—to such an extent that if we continue our ecosystem analogy, we can think of information as the animals and vegetation in the jungle. Just as natives in a jungle understand how to thrive there, so too, must management in its info-jungle. The analogy should not be carried too far, but it helps us to understand the nature of global economics, role of IT (especially the Internet and mobile computing), and the expanding cerebral nature of management and its appetite for analytics, modeling, and experimentation (sometimes mistakenly called entrepreneurialism).
Boiled down to two words, thriving in this ecosystem is all about contexts and connections. It is the ability of people around the world, and within a firm or industry, to be so closely connected to one another that people can interact as they normally would if in close proximity to one another, but in a global setting. That is a remarkable change for the entire world that only recently became a reality. That transformation ranks high on any list of human technological innovations that so profoundly affected the way humans went about their affairs, and is associated with such other important breakthroughs as the use of fire, invention of firearms, flight, and the birth control pill. It is the essential by-product of nearly a century of innovation in information handling but also in how the world works. Reliance on communications, for example, does not mean the world is flat, because various cultures and local practices have not homogenized as fully as some would have us believe. Rather, diverse industries, practices, and places are more connected, and therefore more able to collaborate and trade without necessarily giving up their individuality, collaborating with a growing set of common practices, which today we think of as today’s way of managing and working.
How This Book Is Organized
This book consists of six short essays, that’s it. Each one can be read independently of each other, because I assume you will not have time to read the whole book cover to cover the way all authors want you to do. Each is short for the same reason, you will want the key messages quickly, and I know that if something resonates with you, that you will probe more deeply and to help with that I include a short Library for Management to get you started. Each chapter deals with an issue that is, however, related to all the other issues discussed across the book, so ultimately you really should read the whole book. First I describe the key elements of the emerging management style, much of it already in operation, so you should find some of the material familiar. It is my hope that this is the case so that you will feel comfortable accepting other ideas still for you to encounter. I then head straight into a discussion about information ecosystems because those will drive your activities for the rest of your career. Chapter 3 gets the technology issue on the table since no business management book can ignore that, and as I demonstrate, it is tied to the information ecosystem conversation. We then move on to the most perplexing set of issues facing senior managers, and increasingly all levels of management, how businesses are organized and the issues they are facing. Ultimately for many business professors and senior management, the conversation is largely about organizational issues. But as Chapters 4–6 make clear, that is too facile a view of managerial life. Chapter 5 provides a global “big picture” view of the world, its economic realities, and how businesses are responding. Logically, we could have started the book with this chapter; in fact, I originally did that but decided many readers would prefer to understand those issues coming at them from the perspective of their own personal circumstances, which are the topics covered in Chapters 1–4. The final chapter (Chapter 6) is as brief synopsis of what, hopefully, by the time you read it, are obvious and relevant and so more of a checklist of things not to forget.
The ultimate compliment you could pay me is to read the book, and then come back and reread it 5 years from now. Then you and I would know that we focused on the right issues.
Writing, Like Management, Is a Team Sport
Because it is usually easier to appreciate what an author is doing if the reader knows the writer, a few words are in order about me. I was trained as an historian, then spent the next four decades in various positions at IBM in sales, consulting, and management. I sold computers in the 1970s and 20 years later was still trying to help management figure out what to do with them in various industries. Perched at IBM, I was able to observe at close range the massive adoption of IT across the world as they unfolded and how the work of management evolved. I have walked their paths. In the process, I surveyed, interviewed, or worked with several thousand managers and executives around the world just in the past decade alone; their experiences are the core ingredients of this book. For 8 years, I worked with colleagues at IBM’s management research center, the Institute for Business Value (IBV), and now at the Charles Babbage Institute at the University of Minnesota, two excellent environments for absorbing what is happening and writing about it in a productive way. If you want to continue the conversation, reach me at [email protected]. Teach me about your realities and I’ll share them with others in future publications.
The views expressed in this book are my own. Failings and errors that exist in this book are of my own doing, not of IBM Corporation, University of Minnesota, or the publisher. Because the topic at hand is still undergoing transformation, I expect that some observations and recommendations will be superseded in the years to come. In the meantime, I intend this book to serve as a dispassionate, organized conversation about the emerging realities of modern management in business and government.
I want to thank two anonymous reviewers who made many suggestions for improving this book. Publishing a book is not a solo act. The editorial and production staff at John Wiley & Sons were efficient in moving this book through production. I also want to thank the editorial board of the IEEE Press in supporting my work.
James W. Cortada
Chapter 1Emergence of a New Managerial Style
. . . a time of turbulence is also one of great opportunity for those who can understand, accept, and exploit the new realities. It is above all a time for leadership.
Peter F. Drucker1
Mexican cement manufacturer CEMEX and European toy manufacturer LEGO use social media tools to invite product and service innovations from employees, of course, but also from customers. In the case of LEGO, management pays royalties to ideas turned into products. IBM managers have employees who report directly to them scattered across the world, no longer down the hall, and so expect their workers to take charge of their own time and get things done without constant managerial intervention. Traffic managers in London, Singapore, and Stockholm use massive quantities of data that are collected automatically by sensors to model optimized ways to improve traffic flows, in some instances, several times a day. Marketing managers at Ford Motor Company, Canadian retail bank, TD Bank, and now many insurance companies host online communities of customers who tell them how products and services are performing, even how to make a better hamburger (Red Robin Restaurants), and expect employees to train and mentor each other. Increasingly, the power and work of “management” has diffused further to employees and especially to customers far beyond what had begun as a trend in the 1990s. When looked at as a whole, we see that a new style of management has emerged.
Something strange has been going on quietly, unseen, hardly recognized. Stand on a busy street in any city in the world—and I really mean any city—and one can notice that almost everyone over the age of 12 and under the age of 35 or so, and many clearly over that age, are either plugged into some device (such as an Apple iPod) or radio, are carrying in one hand a mobile phone, or are texting on their “smart” phone. Look for the phenomenon; it is there. Go back in time just 10–15 years and you would have seen a few people with headsets listening to music. Walk into a conference room at any major corporation—and I really mean any large or mid-sized company or government agency—and you will notice the same behavior of people clutching mobile phones if they are under the age of 35 and doing a quick check for messages or peeking at Facebook. Other colleagues walk into the room with iPads that they skim during the meeting, rarely devoting 100% of their attention to what is happening, while those over the age of 50–55 will drag in their ancient laptops or one of those thin ones from Apple and quickly sit down and start working on e-mail. Only the host of the meeting will drop her two or three pieces of hardware on the table and quickly move to a Powerpoint presentation that will provide structure to the meeting. Fifteen years earlier, similar type of meeting would have been conducted with Powerpoint, and everyone might have had a laptop open, doing e-mail of course, but probably without access to wireless Internet, and the manager chairing the meeting would undoubtedly have been a man.
Incrementally, the signs of change were all around us—from the physical appearance of mobile phones and tablet computers to women attaining senior positions. All these changes in work practices happened incrementally, one tiny step at a time slowly over time, so almost hidden. These are tips of icebergs, however, because far more changed in the practice of management. Success in a managerial profession has long depended on understanding the craft of leadership and management, mastering the technical skills and knowledge of such work, and for the most successful, the art of success. This book is about how these three things are followed today, suggesting how they will be done during the professional lives of all those individuals clutching mobile phones, routinely dividing their attention between the Powerpoint presentations and the wealth of interesting contents pouring into their digital devices off of social media sites. In fact, many of these individuals work for organizations that are becoming social media sites themselves; these include municipalities that provide services online to consumers in every major city of the world, and in future to consumers in most towns and villages too, and companies that sell digital content, transfer information from organizations to people for free or fee, or operate almost virtually.
A personal story. In the 1980s, when I first entered the ranks of management at IBM, a secretary worked for me, I had an office, and had access to e-mail on a heavy terminal on my desk. After several promotions, gone was the secretary (I then shared an “administrative assistant” who was a man), gone too was my physical office (although I could borrow an empty one anywhere in the world), while I had a laptop connected to IBM’s e-mail system, the Internet on a dialup line, and increasingly to large databases of business records and consulting materials. Fast forward to the early 2000s, and yet through two more promotions (defined as fancier titles, stock options, and bigger salaries), my manager lived in Amsterdam, I in Madison, Wisconsin; gone was the administrative assistant, although I could lean on one to help me if needed who worked in Boston, Massachusetts, while her backup was in Amsterdam; and my staff was scattered all over the world. In the 1980s, I physically saw my manager every day; in the 1990s probably once in a month; while in the 2000s once in a year and only because we felt we should, but did not know really why anymore. I moved from being told how to do my job, and getting appraised on both the way I worked and the results obtained, to results obtained. Over a period of years, I incrementally had to evolve from a person able to operate in a hierarchical organization taking and giving orders for the most mundane activities to weaving networks of alliances and teams that functioned on their own as self-directed individuals and clusters of people willing to collaborate as long as it made sense to them. No managerial revolution was there at IBM—IBM was far too conservative for that—rather we underwent a continuous process of many evolutions, just as our customers did in all industries around the world, often at roughly the same time and pace.
While evolutions are often nearly invisible, if they are continuous, they ultimately accumulate into enough changes that will seem revolutionary in hindsight. The revolutions are obvious to see unfold, such as the introduction of the smart phone or a change in a government regulation, but the evolutions come at us quietly, slowly, incrementally, and so are not so evident. This book describes some of these evolutions, demonstrates how to spot them, and suggests answers to the most basic question, “So, now what do I do?”
How This Book and Chapters Are Organized and Why
The fundamental purpose of this book is to help you to know the happenings around you as a manager, or as an aspiring one. The reason to do this comes from the fact that managers are today not as broadly aware of their circumstances as they need to be. Their education is often too narrow, they normally know just what they need to in order to perform their current jobs, and they remain too ill-equipped to transform into agile, entrepreneurial leaders, which is what the world of business is demonstrating is required more today than in previous decades. The need for agility and innovation is being forced on managers because the global economy is continuing to integrate, which means you will have more competitors with different business models to contend with and more technological and scientific advances and changes that will force you to work in different ways. You have no choice but to respond to those realities. The help you get is often inadequate or simply wrong. The books that managers read are too often focused on a single issue presented as the next “silver bullet” that will solve all their problems, from long tails to analytics, from “bings” to emulating nineteenth-century generals. So many commentators take an article they published in a business journal and develop it into a book that adds more case studies but not more insight.
Much of that behavior has to be seen for what it normally is: close to near nonsense and it has to stop. Management is a serious business that affects the life and lives of billions of people, the environment of the earth, even perhaps the survival of our species. Management is not an ad hoc or amateur activity. This book respects the growing professionalization of managerial practices, its complexity, and the seriousness with which all workers need to devote to it.
An operating assumption here is that everyone working today has some managerial responsibilities, regardless of title, because that is the way work is routinely done. Like the observer on the sidewalk, things change around us. First, those people clutching their mobile phones are not just embracing technologies—that is not so important—what they are doing is living in a more intensely connected world from which they willingly do not escape as their parents could, and in which they must devote ever less time to any one issue or problem as multiple people crash into their mental spaces. Second, armed with perspectives on what is happening, and all through this book, suggestions are made about how to deal with these changes. But, this is not a cookbook or a highly prescriptive list of “to dos.” There is too much going on for that to work; rather, we have to be agile intellectually and physically able to work in different places, time zones, cultures, and business environments. These forms of flexibility are of considerable value, indeed for many decades. So understanding these and making such capabilities a way of life becomes an important objective. But, much will be offered in the way of telling lessons and actions to build on. We are talking about a style of working in today’s and, more importantly, tomorrow’s business world.
This style of working is not hubris and hype, but this is a serious business because your competitors are coming at you literally from countries you did not think about half a dozen years ago and from industries that did not exist a decade earlier. For example, many competitors to American companies in consumer goods in the 1960s and 1970s operated out of Japan; in the 1980s and 1990s, increasingly out of China and Eastern Europe; and in the early 2000s from the Philippines and Thailand. In case of software business, competitors were from India and China. But today, Vietnam and Indonesia have become the major contributors of consumer goods. That coming and going of international competitors will continue, forcing us to understand who they are and their values. In turn, then, we will need to craft new ways of doing business and of finding customers even in those countries.
To succeed, managers need to be aware of more issues and changes that are underway. They need to think more creatively, not just look at more data (but they need to do that too). They will need to experiment more with business models, terms and conditions, new technologies, and different products and services delivered in innovative ways. They will need to engage with new types of organizations too. The good news is, however, that there is much help on the way, from computer software for modeling situations and options with mountains of data and information, and a large body of managerial practices which business school professors have now spent several generations codifying in convenient ways. The bad news is we are now applying these assistive tools and insights in the ongoing development of our managers insufficiently. But let us be realistic.
A manager still needs the core skills that have evolved into the set of practices widely deployed over the past half century: process management expertise, strong project management practices, reliance on data and spreadsheets, being facile with mobile computing, and an ability to network within their organizations and with clients and industry colleagues in rather fluid circumstances. Their MBA degree would have taught them the basic “facts” of their profession—a good start to be sure—but it was only a start in their education on teaming, corporate politics, use of social media in marketing and product development, life in a supply chain, managing personnel without violating laws or “best practices,” and so forth. Add in the evolutions discussed in this book, and we can see there is much yet to be done, a great deal to learn, and to keep doing constantly.
The strategy for accomplishing the purpose of this book is straightforward. In the six chapters provided, you will be exposed to those issues that, to be blunt about it, in my opinion, are affecting your success the most. That opinion is based on the decades of my work experience at IBM and across over a dozen industries and countries, in mentoring start-up companies, and the research done on these critical issues. I have handled these issues the same way as important management gurus have, such as Peter Drucker and Alfred D. Chandler, Jr. If you have heard of Peter Drucker, and more importantly, read his work on the craft of management, then you know I am going to expose you to the context—most specifically historical context—and also to the profound role of various technologies on work, management, and society. We cannot ignore the power of information technologies, including but not limited to the Internet, social media, or our smart phones. The use of information technologies is as important to our lives as the deployment of electricity in the workplace was to a generation of managers over a century ago. Both are infrastructures that fundamentally changed how people worked and played. Welcome to your world. This chapter discusses some, but not all, of the new ways of management, quickly “netting out” the “big picture.”
Chapter 2 addresses the ever thickening information ecosystem that physically and practically surrounds us and defines our work. Chapter 3 expands the conversation from an individual to the larger world of global industries because industries are large worlds of their own. Each industry affects our work in many ways today. If this book had been written in the 1980s or early 1990s, this chapter would only have been relevant to senior executives, but with global supply chains and competition from everywhere, its content is crucial to most employees and entrepreneurs. Chapter 4 defines who you work for, what that kind of organization looks like, and tones down the rhetoric to remind us of what is not changing yet. Your success is measured by how successful you are in that organizational environment, so understanding some emerging basics is as essential as eating and breathing. Chapter 5, similar to Chapter 3, takes us into a broader landscape of the global economy as it evolves because your work, industry, and company thrive or fail in large part by actions out of your control. The business jungle is growing new plants and new animals are thriving on these. Finally, Chapter 6 pulls together the various insights and recommendations made throughout this book.
This book is short on purpose because most readers do not have the time or the willingness to cover a large topic in detail. We live in a world where the “elevator pitch” is essential, required, and when presented properly, actually useful. To write a short book meant picking topics that seemed important and spending fewer or more pages again based on what seemed relevant. For example, this chapter may strike the reader as too long on history and some points dragging on beyond what is needed; trust me, it is shorter than the subject deserves. But, the reader does not need to take my word for it; there is a short list of important publications at the back of the book that can be read, which fills the gaps of interest to you and that can serve as a correction to my emphasizing one point more than another.
Chapter 1 more specifically focuses on those views, tools, and practices of management that are most influential in shaping the activities and prospects of current and future management. The fundamental idea is that the way a manager works has been and continues to transform into substantive ways. To describe that fundamental transformation, several features of those changes are discussed. Key conversations include the following: thinking in terms of systems and processes because that is the way work flows in an organization are structured today; the roles of simulations, models, and the attraction of numeric data are introduced for similar reasons and these are discussed again in future chapters in more detail; migratory habits of the modern manager since very few will ever spend their entire careers working in one or two enterprises, so there are important implications for individuals on how best to work; how the new style of management is applied at work; and a conclusion with a recap of key implications and suggestions.
My text will appear quite simple to those who want depth, detailed case studies, and intriguing ways of doing work. But there is danger with complexity, of course, and we have too much around us as it is. Clarity of thinking often calls for simpler statements. There is an old U.S. Navy advice to seamen and officers, which has proven of enormous use for decades, “Keep it simple, stupid.” Had bankers crafting complex derivative real estate products in the early 2000s followed that admonition, the Great Recession probably would not have occurred. Complex mathematics in this instance confused even CEOs of large American banks. In the 1990s, Enron operated like a bank instead as an energy firm, which had a century of experience in its industry and called for more command-and-control managerial practices that relied heavily on well-defined processes. The rollout of the U.S. government’s healthcare enrollment system in late 2013 proved to be an unmitigated disaster to say the least, probably because the implementers failed to focus on getting right the three or four critical requirements that over two generations of software developers had learned were essential: adequate testing, rollout of pieces of the application and not everything at once, having adequate amounts of computing power to handle the volumes, and single focal point for all decisions regarding what functions and policies to implement. Instead, as in the other cases, management became victim to complexity. Complexity remains a continuing threat to the success of managers, as it has been for generations. As these recent cases remind us, there are basic managerial behaviors that the business school professors and historians remind us to be important, but too often these behaviors are forgotten by senior executives or are simply not learned by new managers. So, your first lesson is do not assume management even knows the basics of sound practices and fear complexity, yet remain open to changes that can be understood and explained simply.
A Dose of Historica l Perspective
When Peter Drucker published Management in 1974, no woman was the CEO of a Fortune 100 company. In the first year of the twenty-first century, several and 11% of all senior executives in these companies were women. By 2013, women served as the CEOs of some of the world’s iconic companies: IBM, Yahoo!, HP, and Xerox to mention a few. Glass ceilings had been quietly shattered over the past two decades as women worked their way up corporate ladders and along the way changed the gender and ethnic demographics of management in the industrialized economies. Other transformations had slowly occurred. For example, on average, senior executives had been to school longer, more graduated with MBA degrees compared to earlier period, and were younger. They were reaching senior ranks (e.g., CEO, COO, Sr. VP, VP) in their early 50s, 4 years faster, than the earlier generation.2 Professors and consultants documented the expanded professionalization of this younger set of management over the past quarter century, while other observers were complaining that not enough “evidence based” managerial practices had permeated the managerial caste.3 To add to the churn and change, surveys as recently as 2012 still called out the global concern of senior management that their organizations found it difficult to develop rapidly enough skills within their firms needed with which to thrive, because employee skills were not aligned sufficiently with the needs of a corporation.4 But Drucker found similar issues as well, most specifically the lament of management at the lack of sufficient skills among employees and managers, in general, echoing the concerns of the 1960s and 1970s.
Other things were changing at the same time as corporations went global and the economic fortunes of nations were in transition. As transformations were underway in global economic realities, management’s work too evolved, extending a process that had started over a century ago with the creation of the modern corporation so aptly described by historian Alfred D. Chandler, Jr., as run by a new “mandarin class” of managers.5 In a nutshell, what occurred over the past 30 years has been nothing less than the evolution of myriad managerial practices that emerged into a new style of management’s work, as yet unnamed, but because of the profound role of computers in that transformation, it is sufficient for one to begin to view it as possibly a digital, networked, or connected age to label this style of work. But today’s experts shy away from naming their views as digital. At 2013’s Global Peter Drucker Forum, different concepts dominated. Georg Kapsch criticized the ineffectiveness of line organizations, while Don Tapscott wanted the audience to think about new organizational models. Charles Handy did too. The need for innovation remains, so driving fear out and constraining exuberant cost cutting are needed, replacing them with actions that encourage “creative confidence,” to use the words of Tim Brown, CEO of IDEO. Managers have to stop being “zombies” (Umair Haque, Director, Havas Media Labs).6 While self-organizing workplaces require IT and competing around the world does too, these and so many other management experts have got it right: it was never about computing alone, it was about organizing to address opportunities and squelch problems.
The process of shaping a modern manager has been impressively pervasive, extending beyond the confines of Fortune 100 or 1000 firms to include many who moved from those companies to other enterprises and government agencies, graduates of MBA programs around the world, book and magazine writers, and participants in professional associations, all of whom embraced most of the concepts described in the following discussion. Their process of transformation led to new practices created in complete awareness of the work of each other. Book and magazine writers who discussed new managerial techniques came from corporations where they practiced these skills or possibly acquired some of them during their MBA programs. Business school professors learned managerial techniques from their managers and students. Corporate management assimilated insights and lessons from their associations and from the literature they read on modern management methods. Associations too learned from managers, consultants, and professors. If the emerging style of management can be described as virtuous, then the roles of these sources of diffusion constitute such a circle.
An early observation to keep in mind is that managerial practices of the early twenty-first century are being shaped by a set of attitudes (call them beliefs if you will) and a predilection for using tools (software and practices in particular) that were not convenient or even available a generation ago. This book will discuss some of the most important of these with an eye to addressing complexity and the continuing need for innovation.
In several ways, how contemporary managers and executives think and work are the basis for arguing that a new form of managerial style has arrived which is now shaping the features of the manager belonging to the twenty-first century. First, they think tactically in terms of “systems” and “processes.” Second, they rely extensively on data to inform their decisions, and especially on numerically rich results of modeling and simulations, today fashionably called Big Data. They measure the increasing amounts of activities and ideas drawn from sensors on machinery to leading indicators of economic trends. Third, they develop core skills that they take from one firm to another, as they change jobs more frequently than prior generations of managers. Executives and managers often think of their work as international and themselves as members of a transnational class of workers, reaffirming Richard Florida’s idea of the “creative class” or as global business leaders. Fourth, they are comfortable working in flattened organizations with fewer levels of management than in the past, weaving networks of contacts and team members to accomplish goals. These four trends have been unfolding for over two decades, so the young manager can turn into more experienced ones for “war stories” and insights relevant to their immediate jobs to understand how best to leverage these as context must remain one of the most sought-after bodies of knowledge by all managers and executives.
Thinking in Terms of Systems and Processes
As far back as the 1940s, army and navy officers in North America, Western Europe, and the Soviet Union had thought of battlefield tactics and military and economic strategies increasingly as integrated sets of activities. As technologies in communications, computing, and weapons systems became more integrated during the Cold War period in the subsequent three decades following the end of World War II in 1945, the notion of systems increasingly provided an international view for officers and their staffs. By the 1960s, they had already created software to simulate war fighting practices and strategies. Historians of the evolution toward a systems approach to warfare talked about a “closed world” view of fighting in which a battlefield or national war fighting strategy appeared almost as if a self-contained view of even an alternative reality, much like we experience with interactive video games.7 The same occurred with national economic development when, for example, Japan and South Korea developed economies that contained within them all the elements of success they needed, exporting to the West their products and not relying on other countries to do their work.8 That notion of a “closed world” has extended to the present; the mindset now is often called Network Centric Operations (NCO) or Network Centric Warfare (NCW), in warfare, but it applies also to scientific research, global and national economic development, and to much corporate strategy work.9 It is a collective attitude that the world can be viewed as a collection of identifiable systems and processes, all of which can increasingly be shaped, managed, and indeed controlled.
