Month: May 2009

Des Moore on Central Banks


First, contrary to popular interpretations, the blame for the panic cannot primarily be placed on irresponsible bankers: they responded rationally to the subsidy for credit created by central bankers.

But what’s this in the very next paragraph?!?!:
Second, Prime Minister Kevin Rudd is clearly wrong in attributing the crisis to policies that reflect the neo-liberal views of free marketeers. Few if any supporters of free-market policies believe there should be no regulation of monetary conditions. (emphasis added)
Both from The Age.

Manager veto and the management team cartel

There is an interesting lesson about management intensions at the Management Skills Blog.   It serves as a good example of how management teams act like cartels (if you use my analysis approach):


Noble Intentions

Thu, May 14th, 2009 by Tom Foster

In 1948, in London, Elliott began to work closely with the Glacier Metals Company, a manufacturer of precision steel ball bearings. It was a company of some size and technical complication, with different departments, a complement of engineers, a management team and a president named Wilfred Brown.

Like most companies, each week or so, a high level meeting took place, called the Management Team Meeting. It was Wilfred’s intention to purposefully build his executive team by including them in on the company’s largest problems to be solved and decisions to be made.

The executive team responded with enthusiasm to be included in such important activities. By harnessing all the brain power in that room, certainly, they could tackle the toughest challenge and make the best decisions.

The intentions were noble.

As time went by, however, the productivity of the group began to wear thin. In their efforts to reach consensus, to be cooperative and supportive, to be the team they intended to be, the pace began to slow. Discussions became arguments, agendas became political, quid pro quo became active.

And then, the unthinkable. The group would finally arrive at its decision and Wilfred Brown, the President, would invoke his veto.

– from Management Skills Blog ‘Noble Intentions’

My comments are:

The problem is the concept of the ‘management team’ itself.

In my analysis a management team is a cartel!

Which means that when a management team come to agreement – meaning they come to agreement on the value of certain actions and decide the most appropriate action based on their combined assessment of the value of each alternative action – then they are in fact breaking the ‘price system’.

In a real cartel this means they agree on a price, bypassing the price system, and hurting consumers.

In the ‘management team’ cartel they are agreeing on the next action, bypassing the planning process, and hurting capabilities (and consumers).

I’m interested to see how this lesson plays out at Management Skills.

No wrong way to slice the pie? (and do you even know?)

Management, as a discipline, has a problem it can”t solve.  It needs to coordinate separate but related activities caused by the division of labour.  And it needs to be able to do this regardless of how labour is divided.

Project management, in particular, has this problem.   I’ve said before that project management is a perfectly reasonable discipline as long as it doesn’t try to cross organisational boundaries.  This is why project management is necessary but not sufficient in managing outsourcing.

Likewise, program management – which the discipline likes to define as the management of multiple related projects – isn’t really a separate discipline because of the scale of the work or the number of projects, it’s a separate discipline because multiple projects have multiple project managers.

Unfortunately, the accepted tenets of management simply do not scale.   Multiple managers causes more problems than they solve – and therefore situations which require multiple managers need other practices to govern them.

The root of this problem is that ultimately, the discipline of management doesn’t in itself offer any useful advice on how to divide labour.   It takes it as a given that labour is divided and then attempts to coordinate that.

Equally, managers – when you switch them on and give them responsibilities – tend to manage to those responsibilities.  Good so far, but if the division of responsibilities isn’t right there is a problem.  The problem might even get bigger if the managers are better.

But there are right and wrong ways to divide labour.  Some activities are autonomous and some aren’t.  Dividing management responsibilities and activities has its own additional challenges.

Only ‘architecture’ (which I define in this context as deliniated shared understanding) can offer any help in the actual division of labour.  However, architecture must be domain specific.   In order to determine correct/incorrect or efficient/inefficient divisions of labour it must take into account the domain and the required outcome.

(by the way, if you think a ‘strong management team’ solves this problem check out my article on ‘Management Teams as Cartels’)

Thought of the day

Mainstream economics is not the cause of the current financial crisis – rather, the cause of the current financial crisis and the cause of mainstream economics being mainstream are the same.

(article to follow)

Thought of the day

Leadership is knowing what needs to be done before you see the ROI calculation

Again, what is MWT?

I’ve written a few short descriptions of the MWT Model over the years.  I just submitted the following to

ManageWithoutThem is firstly a theory of how organisations actually behave, rather than how managers should behave.  Secondly, it’s a redefinition of the management process so that it benefits the organisation as well as managers themselves.  It re-intermediates management processes and refactors those processes without the implicit role of a separate management class.

Managers still exist in the organisation, of course.  But the the principles of market analysis are applied to the inside of the organisation to allow greater transparency of operational activities without filtering all measurements through management hierarchies.  Rather than flat organisations, the model allows for the accountability of hierarchy without the politics of hierarchy.

The ManageWithoutThem model redefines management as a technology that collaborating individuals share – allowing for the possibility of improving that technology in terms of efficiency, usability, and integration with other technologies.

Check out – it’s filled with managemeent techniques, theories, and models.  This isn’t a critisism of the site at all – but it makes you realise how fragmented and specialised management has become as a profession.

Just like there is always an excuse for more government spending, with such a wide range of management techniques available there is always an excuse to do some more ‘management’.

The term technical is often misused, and used only to apply to engineers, but the management profession itself has become technical in the true sense.  Nobody would argue against the fact that much of that management knowledge, even when it’s correct and useful, is technical in nature.

This means that modern organisations are basically technocratic.

Thought of the day

Management is not never having to say “this is bullsh*t”.

Powered by WordPress & Theme by Anders Norén