By Rod Collins
Most businesses today continue to employ a management discipline that was initially formulated in the early twentieth century by the first management guru, Frederick Taylor. Taylor developed the fundamental management model that guided the evolution of the modern corporation throughout the twentieth century. Known as Scientific Management, this model was designed to catapult the efficiency and productivity of workers by applying scientific methods, such as time and motion studies, to discover the best ways for workers to perform the various tasks of production under the close supervision of a hierarchy of managers.
Taylor’s philosophy quickly became the gospel of management and provided the foundation for much of what many of us, over a century later, still consider to be the givens of professional management: top-down hierarchies, the sharp divide between managers and workers, centralized decision-making, and functional organization. When work was about running factories where the average worker had less than an eighth-grade education and business models could be sustained for 30 – 40 years, Scientific Management was a workable proposition.
However, today we suddenly find ourselves in a dramatically different business landscape where the old assumptions of the industrial age are rapidly giving way to new rules that are spawned by the three forces that have given birth to the digital age:
- Accelerating change has shrunk the expected life of a business model down to 7 – 8 years. In the world of music, for example, we have witnessed, in a very short time span, the rise and the fall of the CD as consumers drove a preference for the digital download over the compact disc.
- Ubiquitous connectivity has created a hyper-connected marketplace where the power to be connected now trumps the power to be in charge, as we recently saw when those in charge at Verizon could not sustain their $2.00 online payment fee over the objections of those who were connected.
- Escalating complexity means that we now live in an exponential world where the most effective organizations are based on the operating principles of complex adaptive systems, which explains why Wikipedia is now the most popular reference work on the planet.
In a recent survey of over 1500 chief executives, IBM found that the top management concern among the CEO’s is the sudden appearance of escalating complexity, More importantly, the survey found that over half of the CEO’s indicated they had serious doubts about the ability of their organizations to handle the challenges of a more complex world. Thus, it’s no surprise that, when asked to identify the most important attribute for leadership success, it was creativity, and not problem-solving or analytical ability, that topped the list.
The late Steve Jobs defined creativity as the ability to connect things. Jobs understood that creativity in organizations is only possible if management structures encourage serendipity and emergence. These unplanned occurrences are what happen when people in companies are highly connected. They are also the building blocks of innovation. That's why, at Apple, there are no business units. Jobs never wanted different areas of his company competing against each other or placing the parochial needs of the unit ahead of the best interests of the company. He designed his organization so that the engineers and the designers had to continually deal with each other to get things done. By keeping these disparate groups connected, serendipity and emergence enabled Apple to become one of the most, if not the most, creative company on the planet.
If creativity is indeed the most important leadership attribute, then organizations must be designed, not as hierarchies with fragmented silos and chains of command, but rather as hyper-connected agile enterprises that are able to innovate at market speed. Despite its longstanding track record of success, the principles and the practices of Scientific Management are no longer adequate to meet the challenges of a post-digital world. Instead, managers need to follow Apple’s lead and learn the innovative ways of thinking and acting of a radically different management model that can be best described as Creative Management.
Rod has more than 30 years of experience in management positions of increasing responsibility in the healthcare industry. Rod is an innovative executive leader with sustained success in achieving financial, operational, and market growth objectives in challenging environments. He has extensive experience in serving as a catalyst for positive change and in building highly collaborative organizations.
Rod is also a member of our Speakers Bureau.
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