New Management Paradigms

1. 8/31/2012 1 New Management Paradigms

2. 8/31/2012 2 Management Thinking 50 years old vs. social universe of change Mary Parker Follet, (ignored)conflict understandingincreased yields �one right organization� (Fayol, Rothenay) functions � eng., sales, personnel etc. reprot to CEO

3. 8/31/2012 3 7 Management Assumptions �That there is only one right way to organize a business. �That the principles of management apply only to business organizations. �That there is a single right way to manage people. �That technologies, markets and end-users are fixed and rarely overlap. �That management's scope is legally defined as applying only to an organization's assets and employees. �That management's job is to "run the business" rather than to concentrate on what is happening outside the business. That is, management is internally, not externally, focused. �That national boundaries define the ecology of enterprise and management.

4. 8/31/2012 4 Discipline of Management Management is 90% about people and 10% about technical Mission Strategy Structure Artificial barrier between business & non-business management Highest recent growth sectors are �non-business� (govt., professions, health services, education)

5. 8/31/2012 5 �One right organization� Large organizations WW1, crisis management requires hierarchy Different circumstances require different structures, therefore a number of co-existing structures may be need within one organization. 1950s - teams in pharmaceuticals industry TRANSPARENCY � Its people should know and understand their own organization�s structure

6. 8/31/2012 6 �One right way to manage people� McGregor, Theories X & Y Maslow, different people have to be managed differrently Knowledge Workers: Must be be managed as associates, volunteers, must be persuaded/led Must know more about their job than their boss does They own the means of production (knowledge) Motivation Not always $ Challenge Mission Training Results

7. 8/31/2012 7 Demise of Technical Boundaries Distinct technologies: electrical, chemical,auto, telephone, pharmaceutical, computers CONVERGENCE EG Bell Labs and transistor Outside technologies are likely to have greatest impact Natural monopolies have faded Anti-trust legislation may be anachronistic

8. 8/31/2012 8 Economics and Markets The �want� is unique, the means to satisfy it is varied. Information is not �scarce� Non-customers are as important as customers, changes always start with non-customers EG consumers show tendency to shift disposable income to updated communication offerings (Japan and television, fax)

9. 8/31/2012 9 Command & Control Legally defined, inside the organization Outside/operational control = keiretsu GM, Sears, Marks and Spencer, HMOs

10. 8/31/2012 10 Managing with external focus: Management Entrepreneurship Management Innovation 1. Organized abandonment 2. Continuing Improvement kaizen 3. Systematic and continuous exploitation of successes 4. Systematic Innovation

11. 8/31/2012 11 �It is therefore the specific function of management to organize the resources of the organization for results outside the organization.�

12. 8/31/2012 12 ��the center of a modern society, economy and community is not technology. It is not information. It is not productivity. The center of modern society is the managed institution. The managed institution is society's way of getting things done these days. And management is the specific tool, the specific function, the specific instrument, to make institutions capable of producing results.�