Companies & Industries

Organizations Need Structure and Flexibility


When people don't know who to take direction from, performance suffers. Just look at the U.S. Boxing Team's dismal performance in Beijing

There is certainly no shortage of management lessons to be gleaned from Michael Phelps's record-shattering performance at the Beijing Olympics—the importance of setting firm objectives and staying sharply focused perhaps chief among them.

Nevertheless, I suspect that Peter Drucker would have been more intrigued by the blows suffered in the boxing ring than by the gold gathered in the swimming pool. It was there, in the square circle, that the U.S. turned in its worst-ever showing, winning but a single bronze medal and sending disheartened fans scurrying to figure out what went wrong.

Interestingly, the answer appears to have relatively little to do with the fighters' athletic prowess and quite a lot to do with the way the team was run. Those in charge of the nine-man Olympic squad ignored a couple of basic principles that Drucker—though more a student of social science than of the sweet science—pounded home: the need for clear direction and yet, at the same time, a certain degree of organizational flexibility.

Too Many Coaches

In large part, the pugilists' problems can be traced to a move made last year: Members of the U.S. team had to leave their homes—and the care of their personal coaches—to live and train for 10 months as part of a new residency program at the U.S. Olympic Committee facility in Colorado. This, in turn, led to several major miscues—the kind that can plague any enterprise, if it's not careful.

The first was that, once in Beijing, at least several U.S. boxers didn't seem to know whom to listen to: the Olympic coach, Dan Campbell, or their longtime personal coaches. The Olympic staff told light flyweight Luis Yanez, for instance, to be aggressive from the opening bell of his big bout. But his hometown coach, to whom he felt tremendous fidelity, counseled patience. "You have the kid caught in between," Campbell told reporters. Yanez lost.

Drucker, for one, wouldn't have been surprised at the outcome. "In any institution, there has to be a final authority," he wrote in his 1999 book, Management Challenges for the 21st Century, "someone who can make the final decisions and who can expect them to be obeyed."

Conflict of Loyalties

But unless it's made plain whose role that is, confusion can arise. To be successful, any organization "has to be transparent," Drucker explained. "People have to know and have to understand the…structure they are supposed to work in. This sounds obvious—but it is far too often violated in most institutions (even in the military)."

The toughest situation, he added, is when people feel pulled in two directions, the way the boxers did. "It is a very old principle of human relations that no one should be put into a conflict of loyalties," Drucker asserted, "and having more than one 'master' creates such a conflict."

Yet Drucker recognized that rigidity isn't the right course, either—and it's here that those directing the U.S. boxing team (and surely a great many other managers) could profitably reconsider their approach.

Organize Flexibly

A common mistake in both management theory and practice, Drucker noted, is that we tend to become fixated on organizing things one way—and one way only. Depending on the era, we make it all about collaboration or all about decentralization or all about command-and-control.

But in truth, "there is no such thing as the one right organization," Drucker wrote. "There are only organizations, each of which has distinct strengths, distinct limitations, and specific applications. It has become clear that organization is not an absolute. It is a tool for making people productive in working together. As such, a given organization structure fits certain tasks in certain conditions and at certain times."

Frequently, it's assumed that "institutions are homogenous and that, therefore, the entire enterprise should be organized the same way," Drucker continued. "But in any one enterprise…there is need for a number of different organization structures coexisting side by side."

Tricky Coordination

For the boxers, this suggests that the best way forward may well be a blend, with weeklong periods of training at the Olympic site combined with personal coaching at home that is designed to reinforce the strategy set by the national team. Making this work would require deft coordination—and constant communication—among the different coaches to ensure that everyone is on the same page, but there's no doubt that it's doable. In fact, the women's gymnastics team operates under just such a model.

Jim Millman, the chairman of USA Boxing, has already indicated that he's interested in making some changes—though just how extensive remains to be seen. If Drucker is any guide, Millman and his colleagues shouldn't hesitate to be bold, especially given how high expectations were for the U.S. boxing team in Beijing. Some observers even thought this group might snare the most medals since 1984, when the U.S. collected 10 golds and two silvers in the ring.

"Unexpected failure…should be taken as seriously as a 60-year-old man's first 'minor' heart attack," Drucker wrote. What's more, good leaders "do not dismiss unexpected failure as the result of a subordinate's incompetence or as an accident but treat it as a symptom of 'systems failure.'"

That's vintage Drucker, never pulling a punch.

Rick Wartzman is the director of the Drucker Institute at Claremont Graduate University and an Irvine senior fellow at the New America Foundation.

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