Headstart: Management – Where are the ‘people’ people?

‘I pay tribute to all our employees without whose dedication and loyalty … blah, blah.’ Just another dose of typical boilerplate from the chairman’s statement. But paying lip service to our workforce is not good enough.

In 1968 I attended a training course on the exciting new world of behavioural science in management. We had Herzberg’s Hygiene Factors, Maslow’s Hierarchy of Needs and, most excitingly, MacGregor’s Theory X and Theory Y.

Theory X says people are lazy and must be driven, either by fear or greed.

Theory Y says people come to work for low-level needs like pay, but only work well to meet high level needs such as self-fulfilment.

Stirring stuff. Starry-eyed, I believed I was going to witness a revolution in managerial practice. But it never came. Things are certainly better than in 1968, but effective Theory Y management is still the exception rather than the rule.

What does a Theory X company look like? You will recognise the symptoms.

A blame culture. Complaints of inadequate communication. Staff working in boxes, not knowing what others do and focusing on covering their arses.

Confusion about the direction of the company. Concentration instead on the annual bonus. Fear. Lots of industrial tribunals. Action men (and it is men) who are impatient and dislike meetings. And of course average results.

What about a Theory Y company? Organisations famed for their people management are rare, but again you will recognise the characteristics.

Fair human resources policies on things like pay and appraisals. A lot of communication, much of it apparently redundant. Delegation to low levels. Early responsibility. Shared decision-making. A culture of openness and honesty. Trust. Teamwork. But demanding managers. Results-orientation.

A lack of complexity. Ultra-high performance. And pride.

Theory Y is often seen as limp wimp stuff. But Hilary Cropper, chairman of XANSA, advocates such an open style of management emphasising the importance of shared success. But she does not see her approach as limp. Rather, she says it’s ‘as tough as old boots’. If you treat people fairly, if you give them clear responsibilities, if you ensure they are fully in the picture, then you can be more demanding of results.

So why has it not caught on? I don’t know. Since 1968, successive generations have reinvented it in different forms. There has been involvement and participation, empowerment, an enabling management style, the listening company and the triple bottom line. All say the same and claim the same benefits, but none have stuck. Yet it has been proven to work, is easy to do and the world would be a better place if more managers were to become ‘people’ people.

– Neil Chisman is a director of several companies, a member of the Financial Reporting Council and a former FD of Stakis and Thorn.

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