Magazine

Throw Away The Cookie Cutter


THE FUTURE OF MANAGEMENT

By Gary Hamel with Bill Breen

Harvard Business School Press; 272pp; $26.95

(Readers'

Reviews below)

Editor's Review

The Good A crusading call for radical changes in ways of managing organizations.

The Bad Some of the ideas from company examples are impractical if strictly applied.

The Bottom Line Best for those interested in stimulating concepts rather than a road map for change.

There's a reason boards of directors can pluck so many CEOs out of one company and plop them into another: When it comes to management ideas and tools, many companies are surprisingly similar. They have the same hierarchies and budgeting processes. They have "balanced scorecards" that measure performance. They benchmark their peers, adopt "best practices," and seemingly all house an army of Six Sigma black belts standing ready to defend quality control.

Such management monotony, writes Gary Hamel in The Future of Management, is evidence that when it comes to running organizations or leading teams, there's little experimentation. In this lively manifesto, written with Fast Company veteran Bill Breen, Hamel argues that "management innovation"—rethinking decision-making practices, organizational structures, and the demands on employees' time—is crucial for coping with today's business challenges. While the book's revolutionary zeal and overly familiar examples will be off-putting to some, it offers plenty of compelling, if sometimes unorthodox, ideas.

A crusading tone is not new for Hamel. The well-known strategy guru and consultant who wrote Leading the Revolution and, with University of Michigan professor C.K. Prahalad, Competing for the Future, has long hailed companies that shake up the status quo. On at least one occasion, that has led to an embarrassing result: In Leading the Revolution, which was first published in 2000, Hamel famously praised Enron's "genius for innovation."

In The Future of Management, Hamel argues that new ways of managing people or organizing companies can lead to the most durable, "difficult to duplicate" competitive advantages. Such an approach differs from process improvement, which can be copied, or an emphasis on new products, which can be commoditized. Hamel ushers the reader through his examples and arguments at an enjoyable pace. And his questions will help managers consider which of their day-to-day practices are necessary tradition and which are unexamined dogma.

There's much here that will resonate with forward-thinking managers. The description of Best Buy (BBY) Vice-President Jeff Severts' efforts to involve hundreds of employees in forecasting will be instructive to anyone interested in tapping the wisdom of crowds. A discussion on the need for a more market-based approach to funding ideas inside corporations will likely influence managers struggling to encourage fresh thinking. And Hamel's contention that companies should examine the broader purpose they serve in order to help motivate workers is especially apt. Many companies today are struggling with how to attract socially minded young talent.

Hamel's best company examples—Best Buy, Whirlpool's (WHR) attempts to jump-start innovation, IBM's (IBM) efforts to build emerging businesses—look at how large, traditional corporations have experimented with new management ideas. Unfortunately, he devotes more space to those that started off with inventive work environments, including the much discussed cases of Google (GOOG), Gore-Tex maker W.L. Gore, and Whole Foods (WFMI). For most organizations, starting from scratch is not an option.

The book has other shortcomings. Some of the practices he commends—such as Gore's "lattice" structure, in which there are few bosses and employees form teams based on interest rather than assignment—would be impractical, if not counterproductive, for certain workforces. There's little discussion of how such radical management models would sit with either shareholders or corporate directors.

Also, while Hamel admits the difficulties of management innovation, he only briefly acknowledges the considerable risks involved. If a new product fails, the investment is lost and some people may lose their jobs. If an experiment on how information is shared or how key decisions are made goes awry, the damage inflicted on a company's culture may be just as costly.

Hamel doesn't explicitly describe his vision of the future of management until the last six pages. There he suggests that in years to come, organizations will come to resemble the community-driven model of Web 2.0. Some attributes of the Web ("everyone has a voice," for instance) are desirable for all organizations. Others ("the only hierarchies are natural' hierarchies") in most cases would be unworkable if strictly applied. In the end, Hamel's book will be most appealing to readers interested in thought-provoking ideas rather than a step-by-step road map for change.

By Jena McGregor


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