As we sped down the large superhighway from the Hongqiao Airport to the center of Shanghai, it was difficult to believe that I was in China. When I was invited to speak on leadership at an HR Summit in Shanghai, I had envisioned a very different China - one with crowded streets, tightly packed buildings and overt signs of poverty.
Instead the roads were better than those in Boston, my home base. The city's broad streets were clean. Elegant skyscrapers were scattered along the Huangpu, the large river that winds through the middle of Shanghai, in a pattern that ensured that no one building overshadowed another. At night artfully positioned lights highlighted the special architectural features of buildings and enhanced the contrasts between the old and new buildings.
Impressed I marveled to my host about how China had accomplished this in such a brief period of time. He responded that an autocratic democracy has its advantages. This made think about the difficulties that U.S. companies have in implementing change. Is their embrace of democratic management practices putting them at a disadvantage in a world where rapid change is the norm?
Interestingly, U.S. management practices were much more autocratic, like those in China, during the period following World War II, a period in which the U.S. made itself into a major economic power. Employees respected the authority of their managers and readily complied with their directives.
In turn management did what it believed was best for the company without feeling that it needed to involve employees in these decisions or to spend large sums of money on programs designed to cajole employees into adopting its change agendas.
This changed with the introduction of modern participative management practices which have served to democratize the U.S. workplace and undermine management authority. Students at U.S. business schools are now taught that being a "manager" no longer carries much authority. They are instructed that they can no longer tell people what to do. Instead they must use influence tactics to motivate and manipulate the employees whom they manage into doing their jobs.
Practices, like 360 evaluations, in which employees critique their managers, have further eroded any lingering authority that managers may have. If an employee doesn't like his manager or thinks that he is too demanding, he can give him a bad evaluation. As a consequence, managers who push for high performance can find themselves having to explain to their bosses why they received negative comments on their 360 evaluations.
A side effect of this empowerment of employees and disempowerment of management is that personal conflicts are now considered a normal part of the U.S. workplace. In this new culture of equality employees seem more comfortable expressing the unpleasant aspects of their personalities and giving full vent to their negative feelings towards colleagues.
One of the consequences is that managers must now devote a large proportion of their time to psychologically tending their employees. They are expected to be psychological gurus who both counsel their employees while at the same time probing their psyches to figure out how to motivate and energize them to do work without incurring their ill will.
Another problem with too much workplace equality and democracy is that it is costly and reduces productivity. Allowing everyone to participate in decisions is time consuming and doesn't always result in the best decisions.
It can also create a culture in which employees who are self-motivated and committed to doing a good job can become workplace pariahs. A recent psychological study at Washington State University found that employees who work hard and willingly take on unpleasant tasks without complaining are disliked by both their coworkers and managers. Coworkers resent them and managers find them unsettling because they don't know how to deal with employees who don't need to be psychologically conned and manipulated into doing work.
From this perspective it is no wonder that China's economy with its more authoritarian approach is booming. In China respect for the authority still exists. It begins at school where teachers are respected and held in high esteem and continues in the workplace where the managers serve as employees' new teachers. As a result, managers are freed to focus on the work of the company rather than the psychological tending of their employees.
If U.S. companies want to compete in the new rapid-paced economy, they may need to reintroduce some authoritarianism into their workplaces. This does not mean a move back to the dehumanizing labor conditions that once existed. Sports teams and the military demonstrate that more authoritarian management practices are often valued by employees. People who work for such organizations take pride in being a part of them and contributing to their success.
This was like a breath of fresh air to me! I have seen the organization I am now a part of go from a leading edge innovator, to a trailing edge 'me to' business, due to a lot of this democratic management stuff. I grew up at the tail-end of the autocratic era, and miss a lot of the things it stood for, and the progress we made. Maybe that is the root cause of my funk with business today.......
I was in Shanghai in 2008 and still know people there, I find it hard to believe the 'crowded streets, tightly packed buildings and overt signs of poverty' have disappeared, not sure where exactly the author went in Shanghai...but that said, yes, Shanghai - among the crowded streets, tightly packed buildings, and overt signs of poverty - has excellent innovations such as the towering raised sidewalks moving people over busy intersections and the differentiation of bicycle/motorped vs. vehicular vs. people traffic which in the developing city do an excellent job of managing the congestion. Perhaps she didn't see the poverty because she never bothered to turn a corner from the busy streets, as the poor are generally efficiently segregated (although near the more touristy areas and near the river you can see the teeming desperate poor quite easily).
Anyway, I think this article does have a great point but would have been good to point to the quantitative data just suggested here. I think to some degree this article, though, confuses efficient, directing leadership with lazy, undirected management in organizations that embrace 360 degree reviews and other very valid tools that seem to be off-handedly denigrated here. The purpose of broad input and investing employees into information gathering and decision-making is not to democratize and certainly not to delay decision-making but it should be, and when well-done is, a more rapid process where leadership understands information better and makes quick decisions, not defers to endless meetings. I wholly agree that too often the more 'sensitive' approach both obscures decision-making (the authority center as well as the process thereof) and is too democratic, but that's more often, I contend, simply poor, non-decisive management coupled with poor use of good tools. In prior, 'autocratic' days that non-decisive management existed, it simply manifested in more rapid and senseless changes and non-enforced decisions (or decisions just as delayed but through red tape and bureaucracy rather than endless meetings and consensus-building gone awry).
Regardless, it is absolutely critical that leaders in any business understand it is not a democracy, ensure people understand that as well, and has the ability to make and hold to rapid decisions when needed. We do lose that in the faux democratization and over-collaboration of workplaces.
I'm not sure if the beauty observed in China is the result of supply and demand or the result of the Chinese government pouring public money into the economy to artificially reduce unemployment or stimulate its economy. Elegantly constructed ghost town were widely reported around China. An autocratic management style, whether excercised by the State or in a corporation may work in a Chinese culture where people have learnt to be subservient. It may have very different result when applied in a democratic society where people generally have higher education and more choices. There isn't a single management style that would work in all cases.
This editorial is catastrophically off base on a number of points. With due respect to the author, it reads as if she was seeking to confirm the business value of her ideal workplace: one where employees cower in fear of her, do whatever she requests, and never bother her with their problems. There are (at least) two major problems with the argument that such a place breeds greater corporate success. First, is that innovation (the true engine for growth in value and sustainable advantage) tends to come from the bottom up in large organizations. There are exceptions like Apple, and startups are different since the leaders are also often the inventors, but in most large companies the leadership and middle management are not creators. We have evolved these open workplaces because large companies are desperately trying to tap into the knowledge and expertise that comes from their workers. It is the best way for them to compete with nimble upstarts that, thanks to technology, are emerging and scaling much faster than they have historically. You would have to pretend Google with it's 20% time and GE with it's flattened org structure were unsuccessful organizations to accept the author's argument.
Second, even China recognizes that this type of worker culture is not creating a sustainable advantage. While American schools are becoming more and more rote and standardized, Chinese schools are adopting American liberal arts-style education, with emphasis on original and critical thinking. They recognize that unquestioning automatons are valuable only so long as they are a cheap labor source. This model is very effective for churning out widgets efficiently. But as they develop and their costs of labor increase, they will lose that cost advantage and need to create unique and original technology, products, and services. This only comes from a more open, collaborative education and work environment.
China's recent progress has indeed been impressive, but we should not confuse the natural economic growth that results from a massive unemployment, low cost of labor, and strategic government planning with successful business culture that would function equally well in a developed nation.
I'm old enough to remember when the same things were said about the Soviet Union. The Moscow subway was once a new, shining example. Along the same line, Arab petro-states have glorious trophy properties and spanking new communities, but we know that's not the whole story. Initial impressions can be misleading.
As for authoritarian management, U.S. workplaces were far more unionized after World War II than today. They were also more hierarchical. Your boss knew your work because he (few women) had done it before, and your path to growth was to be promoted in your department.
Today's workplaces are organized horizontally. Supervisors must necessarily negotiate at times with highly skilled specialists whose work is a complete mystery to the supervisors. At the same time, those specialists must be rewarded with perks and respect, because there are few possibilities for promotion in horizontal organizations.
Sure, China is all the rage because of its progress and our shortcomings, but we must become better, more efficient Americans, not Chinese wanna-be's. We've never been good at authoritarianism, and I hope we never will be.
Utter nonsense. Even Drucker admitted 40 years ago that you can manage manual workers by giving them orders, but that does not work for knowledge workers.
China is excelling in manufacturing, where such autocratic approach works, but still lags behind in more creative endeavours. You can not order around people who know more how to do their job, than their bosses.
Also, unhappy employees vote with their feet. And it is orders of magnitude more difficult and expensive to replace highly skilled professional than simple worker. Given current labour market of course employees will tolerate autocratic bosses but will flee provided the opportunity. So bossing around is not sustainable HR strategy.
I think a major point overlooked here is that Shanghai only finished being host to the World Expo in November. 70,000,000 people were expected to visit there between May and October and that number had already been exceeded by the time I visited during the last two weeks of the event. People had been detailed to show an extremely welcoming face to visitors not only from overseas but also from other regions of China. Nevertheless, as with the Beijing Olympics, the greatest effort had gone into showing the host country at its best to foreign visitors - so much so that as a British passport holder I was directed by a A4 size notice to jump a queue eight people deep and guaranteed to stand in line for five hours at least before getting inside the Seed Cathedral (google it!) - the UK's wonderfully inventive pavilion. This creation of democratic management was the second most popular visitor attraction after China's own pavilion. Janet Howd
I agree with the author, and so do anthropologists: read Mary Douglas, developer of the highly acclaimed Grid and Group cultural theory. Strongly heirarchical (hi grid) cultures with highly collective societies (hi group) have historically achieved long-term, huge success. All the great Ziggurats - still standing millenia later, by the way - were built in Hi Grid Hi Group cultures: The Mayan pyramids, ancient Egyptian pyramids, ziggurats in the middle east.
Here's the caveat: this structure would NEVER work in the United States today. We are a highly individualistic (Lo Group) culture. We value the progress and fulfillment of individuals much more than we value the progress of groups. We do have a strong sense of heirarchy (hence the importance of status symbols like luxury cars, clothing, homes, jewelry), but without the Hi Group component, we will not build as high for as long. The reason post-WWII was so productive, is because we were willing to sacrifice personal fulfillment for the good of the collective whole.
Unfortunately, our American culture will not last for millenia. History proves that democratic, individualistic cultures last at most a few hundred years: then society begins to deteriorate as individuals are increasingly unwilling to sacrifice for a 'greater good.'
I personally wouldn't trade our cultural values - I'm glad I don't have to live in fear, motivated by personal sacrfice and a fatalistic attitude...and I don't really care that we won't have big structural ruins hanging around in 2000 years - I'm happy today!!
One thing to recall from our 'autocratic past'...
In those days management felt responsible for and showed loyalty to their employees and loyalty was returned by the employees. An employee may work 20-50 years for the same company and bellieved in the establishment for a lifetime.
These days, the personal responsibility and compassion toward 'the little people' is long gone. More businesses are publlicly owned and management comes from a distant and detached stockholder population who hold a company's board of directors and CEO directly reponsible for only the bottom line, little people be damned!
Such isolation and de-humanization has resulted in a dangerous drop in employee loyalty to companies in days where state supported espionage is on a rapid rise. Who is to say that sabotage is not next? With decreased loyalty, both attacks are more viable given that an employee seems, increasingly and constantly at odds with employers. One may expect that any given employee would be more willing to secure his future by passing on company secrets in exchange for cash... untaxed at that!
Autocratic management can have benefits for employees as long as the autocrats are held accountable for results resulting from their autocratic decisions. This lifts a weight from employee shoulders.
Basilio said:
“Utter nonsense. Even Drucker admitted 40 years ago that you can manage manual workers by giving them orders, but that does not work for knowledge workers.” Basilio
I agree with Basillio in that I have seen that employees’ experience and knowledge are not appreciated whatsoever by management who cut heads at “the drop of a hat” these days. In my business, company specific methods, combinations of technologies, new, stone-age (and everything in between,) culture, processes, and so on, are a huge part of one’s ability to do a job efficiently and well. It has been said and proven throughout the years that an “off the street hire” requires a year to gain any semblance of confidence and two years to “earn his keep” and three years to yield company profit, respected in a facet or two of his job, and be autonomous most of the time (not having to constantly ask questions of the “established gurus”).
Manufacturing and skilled workers can, in general, be trained much quicker and at a lower cost.
I have seen the company drop an employee who would require any three new-hires and 6-12 months of intense learning to reasonably make up for the loss. …stupid management practice, imo.
We need more employee loyalty in these days when companies are being attacked.
Perhaps a bit of mutual loyalty from management could be at least part of a remedy.
Mike
Very good material for discussion here on comments, started by a very controversial text. Those comments will definitely enrich the author's classes or next text or even next book, so we can expect to see a more ellaborate view from the author any time soon.
I am not going to state the obvious; the mass of the comments already are doing it.
I suspect the type of US industry flourishing in the WWII era was manufacturing and yes I agree that autocratic management style worked then and now in a manufacturing environment. In the Information Age, when managing skilled workers such as software engineers, this style does not work as well. It is quickly becoming the management style encouraged and rewarded in my company by the executive branch. And this style propogates, we are seeing growing anger and frustration in engineers, who are leaving in steeply increasing numbers despite the still-weak economy. All management styles can work. This is not the right style for engineers.
Thank you for this insightful article - I will share.
Such a well written article. Although it is addressed to audiences in super power countries, I would like to draw comparisons from Lebanon. The Lebanese workplace is a potpourri of third world business practices; autocratic, slave-like and devoid of real management concepts; and best business practices learned from their US and European counterparts. In the middle, there is a battery of tests trying to find a healthy mix of both. Not one segment seems to work in any efficient wanner. Democratic cultures adapt, evolve and more forward with policies and strategies that they believe would provide the best catalysts to advance their goals and that is reflected in the business practices they adopt. The missing ingredient there, where buisness management policies are failing, is mostly due to a lack of faith in the countries' leadership and direction, which eats away at feelings of patriotism and of having to serve the better needs of society as a whole. In China, that doesn't seem to be happening. So it's not a question of autocratic or democratic, but rather of belief that the country's leaders are lending support to the idea that any and all policies they enact or support is really for the better good of the people. I can't see talking place in Lebanon, nor at a much wider perspective in the US. Simplistic? Maybe. But true.
Absolutely disagree with the ideas behind the article. Yes, there must be sense of order in a company but that must not be confused with authoritarian behaviour. People in general want to belong and if the group has a set of core values that the employees can identify with they will show commitment and loyalty. Unfortunately making money is very seldom a perceived core value and if that is top managements vision they will find workers not members. The most important asset of a company is a skilled, commited employee who will gladly take orders because they make sense and are in line with the core values.