Oct 13, 2010

- The 5 Stupidest Management Fads of All Time

 (1) Business Process Reengineering

  • The theory: Analyze the workflows and processes within your organization and rework them to achieve a defined business outcome. Set up cross-functional teams in order to re-engineer separate functional tasks into complete cross-functional processes. Integrate a wide number of business functions through enterprise resource planning, supply chain management, yada-yada-yada, etc., etc.
  • The reality: Forget about redesigning processes.  Reengineering is all about layoffs.  Top management uses the idea to justify firing people in order to make it seem like they’re actually doing something logical, rather than just temporarily boosting the stock price so that their short term stock options pay off big.
  • The result: A string of layoffs, followed by the total collapse of your company.  Probably sooner rather than later.
  • My opinion of the fad: The whole idea is terminally idiotic.  Massively changing a corporation while it’s operating is exactly like trying to redesign and retool an automobile while you’re driving down the highway. In any case, reengineering assumes that corporations fail because of lousy processes, when it’s almost ALWAYS the result of lousy management.
  • Likelihood you’ll run into it at least once: 65%
  • Your strategy if you do: If your company announces that it’s reengineering, update your resume.  Start networking like crazy and line up your new position in another company as soon as possible.  Even if you’re well positioned to survive the layoffs, you won’t want to work there after the reengineering has been going on for a while.  Trust me on this.

 (2) Matrix Management

  • The theory: People with similar skills are pooled for work assignments. For example, all engineers may be in one engineering department and report to an engineering manager, but these same engineers may be assigned to different projects and report to a project manager while working on that project. Therefore, each engineer may have to work under several managers to get their job done.
  • The reality: An endless, debilitating turf war.  Each manager fights to be considered the “real” manager of the personnel.  They do this by forcing everybody to attend required “staff meetings” and by finding extra hoops to jump through and extra rocks to fetch, in order to prove that that they’re the ones who are really in charge.
  • The result: All productive work grinds to an immediate halt.  Management becomes completely consumed in arguments over who will do what and when.  Because the system creates more managers, the organization quickly becomes top heavy.  Eventually, top management figures out that this is a terminally bonehead idea and puts one person in charge.
  • My opinion of the fad: I actually worked in an organization that had matrix management.  Everyone reported to three managers, and each manager insisted upon having a mandatory 3 hour meeting every week (no agenda).  Their manager also required everyone to attend a one hour mandatory meeting every week — to “facilitate communication.”  That was 10 hours — 25% of the work week — wasted in nonsense.
  • Likelihood you’ll run into it at least once: 10%
  • Your Strategy: Make sure you can access the Internet inside your company’s conference room.  During the unending turf hassles, you can answer emails, surf the web, play games, etc.  Otherwise, you have to wait this one out.  It won’t last for more than a year.

 (3) Management by Consensus

  • The theory: Important decisions should be made with the agreement of everybody in the group.  Proposals are  collaboratively developed, and full agreement is a primary objective.  Consensus management is usually seen as an alternative to “top-down” decision making common inside hierarchical organizations.
  • The reality: Since everybody has a say in the decision, anybody can effectively veto any decision.  As a result, only decisions that are completely innocuous and support the status quo are ever made.  Difficult decisions — ones that might ruffle feathers — get quietly shunted aside.
  • The result: Forget the wisdom of crowds.  Crowds are so stupid they can’t even figure out what the crowd is thinking. Specifically, consensus decision-making often results in what’s called “the Abilene paradox,” where a group will unanimously agree on a course of action that no individual member of the group desires because no one is willing to go against the perceived will of the group.
  • My opinion of the fad: Management by consensus like swimming in a pool of quicksand.  Because important decisions never get made, the entire organizations flounders and sinks.  BTW, consensus management sometimes happens accidentally when groups have managers who are afraid to make decisions because somebody who works for them might be offended.
  • Likelihood you’ll run into it at least once: 35%
  • Your strategy if you do: Volunteer to keep minutes of the meeting.  Make the decisions yourself and then pawn them off as consensus.  Nobody will notice unless you get too ambitious, like claiming that the consensus was that everyone should wear their underwear inside out.

 (4) Core Competency

  • The theory: Focus on the one thing that your firm does better than anyone else.  That will make your strategy difficult for competitors to imitate and keep your organization from wasting time doing things that they’re not very good at.
  • The reality: Most organizations, like the managers that run them, are about as self aware as a turnip.  As a result, they seldom know what they’re really good at.  In many cases, organizations think they’re good at something but are actually successful for some completely different reason.
  • The result: Core competence generally ends up as a kind of myth that keeps a company locked into doing what it was successful at doing in the past.  As a result, companies that focus on their core competence soon find that they have competitors running rings around them.
  • My opinion of the fad: Like all management fads, this sounds like a great idea, but it must be implemented by corporate managers, which means that even if it were the most brilliant idea in the world, they would still bollix things up beyond all recognition.
  • Likelihood you’ll run into it at least once: 85%
  • Your strategy if you do: Get involved in the committee that’s suppose to determine the core competence.  Make sure that whatever you do is the company’s core competence.  If you fail, transfer to the group that did win the discussion.

(5) Management By Objectives

  • The theory: Define objectives within an organization so that management and employees agree to the objectives and understand what they are in the organization. Then compare the employee’s actual performance with the standards set and agreed upon.
  • The reality: Everyone spends hours making plans for the future.  When the future actually happens, it ends up looking nothing like it was originally expected.  As a result, everyone ends up either doing something that might have worked a year ago or doing something that wasn’t in the original plan and then spends extra effort making it look as if they were performing to the plan.
  • The result: Lots and lots of out-of-date planning documents and precious little to show for it.   Success rate in the typical company is supposedly around 6% percent.
  • My opinion of the fad: There’s nothing wrong with having goals and making sure you know what you’re supposed to be doing, but MBO becomes a fad when it’s just part of the same old review process.  Worst case, it turns into a paperwork nightmare that strips flexibility from an organization.
  • Likelihood you’ll run into it at least once: 90%
  • Your strategy if you do: Try to be as vague as possible about your objectives and have multiple ways to get measured, so that no matter what happens you still look like you’ve fulfilled the objective. Above all, don’t feel guilty about gaming the system, because your boss is probably gaming it up the chain anyway.


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