Management
Innovation
Introduction
This presentation aims to assist you to:
•Understand “management” theory and how it
has developed over time
•Understand why management innovation is
important in today’s business climate
•Understand what it entails
•Identify ways to innovate your current
management model
A history of ‘management’
 Management has been around since the dawn of civilization
 Management-like thought can be traced back to the builders of the
pyramids of ancient Egypt, where the first “managers” had to supervise
and motivate the slaves, tell them what to do, follow up and ensure the
task was done, and then to chastise those whose performance was not
satisfactory
A history of ‘management’
 However, it was only at the end of the 19th century , and the
industrial revolution, that management as a concept was developed
 “The hit them with a whip” school of management was
predominant during this period, where workers were seen as machines
expected to produce results – the goal being mass production and
maximum output, and to increase the wealth of owners
A history of ‘management’
 Other methods of managing workers received classical expression in
Frederick Taylor’s Scientific Management Theory in 1911
“Taylorism” led to the development of new management tools
involving such techniques as measurement and statistics
Organisations were characterised by:
•Command and control, hierarchy of authority
•Impersonal rules, standardised procedures
•Promotion based on achievement
•Employees not to be trusted
•Human rights ignored
•Environmental concerns ignored
•Competitive advantage gained by an organisation’s ability
to produce goods efficiently – the “production era”
A history of ‘management’
 During the 1960’s management theory took a more human
approach
 Post World War 11 thinking meant that there was a greater respect
for democracy and the recognition of a more educated workforce
Abraham Maslow, a psychologist developed a Hierarchy of needs for
human beings (1954), which was reflected in the changes in thinking
around management and management theory
Individual thought, needs, a sense of belonging
self-actualisation became recognised as important
for workers to be able to be fully productive
Maslow’s Hierarchy of Needs
[adapted for the workplace]
Growth
Creativity
Self actualisation
Self esteem, status,
prestige
accomplishment
Social, belonging
Intimate relationships, friends
Safety, security
Physiological
Food, water, warmth, rest
A history of ‘management’
 1940’s to 1970’s saw growth and expansion of markets
 Markets were growing and the “multinational firm” was established
 Profits grew by increasing market size – “the market economy”
Competitive advantage gained by market size and service excellence
Challenging legacies of past
 Many management models used today are still based on the
legacies of the past, and the remnants of these old methods still exist
 Gary Hamel, the well known guru on management
innovation and Professor of the London Business School,
states that most of the essential tools and techniques of
modern management were invented by those individuals
born in the 19th century, and that a radical overhaul of this
ageing technology is required
[Daniel H. Pink. Drive: The Surprising Truth About What Motivates Us
(Kindle Location 2313). Riverhead Books]
Challenging legacies of past
Traditional management models – with emphasis on hierarchy and
the importance of labour inputs - lag behind the need for companies
today to :
emphasize collaboration
emphasize wealth creation by talented employees
recognize the social, environmental and financial
responsibility of companies in today’s
global environment
Characteristics of today’s business world
Technological advances
 Ongoing globalisation
Declining predictability of strategic planning models
Internet speed, number of internet connections, number of mobile devices
connected to the web, and the number of social media applications are
increasing at an exponential pace
The “knowledge” economy
Outsourcing of work offshore to lower paid workers
(Bulgaria/India/Philippines)
New generation of employees – the Y generation
Characteristics of the Y generation
Fastest growing segment of today’s workforce
Characteristics:
Tech-savvy
Family Centric
Achievement orientated
Team orientated
Attention craving
Competitive advantage today
The competitive advantage in today’s business world will be gained
by:
“an organisation’s ability to develop intellectual property –
-this is the “knowledge” economy”
[Ed Weymes: A challenge to traditional management theory]
Management Innovation
•Gary Hamel posits that forward thinking executives must respond to
the growing need for a new managerial model
•Forward thinking executives need to discard decades of management
orthodoxy and balance revolutionary thinking with practical
experimentation to feel a way to new, innovative management models
A definition of Management Innovation
Management innovation can be defined as :
“ a difference in the form, quantity, or state over time
of the management activities
in an organisation
where the change is a novel or unprecedented departure
from the past”
[Hargrave & Van de Ven, 2006]
Why do we need to innovate our
management model?
Hamel posits that companies that challenge some of the old
management beliefs and dogma, and who evolve their
management models to specifically meet their current needs
and desired outcomes will :
gain the competitive edge
be more successful in the future
 Innovation relating to management will
produce long lasting advantages
A new management model
Management is for everyone: the distinction between
managers and workers will fade away and “management
knowledge” will be everyone’s responsibility, as
educational levels rise and Information Technology
accelerates
Management is for learners: as knowledge continues to
explode everyone is a learner
Management is based on communicating: dialogue and
communication
Management is about change: change management will
be “business as usual”
Management is broad based: as boundaries disappear
within organisations, and globally, the scope of
management will grow, and managers will become
organisational development experts, diversity experts,
facilitation experts, consultation experts
[21st century management
www.manage2001.com/21m.htm]
A new management model
Management therefore needs to focus on being:
more adaptable
 more innovative
more creative
more engaging
more transparent
more collaborative
more trusting
embrace relationship as key
A shift in philosophy: building an
organisation on values and relationships
Growing importance of knowledge creation and corporate social
responsibility
Purpose of business: a shift to:
Add value to society
Developing sustainable relationships within the organisation
Developing sustainable relationships with stakeholders
Develop a management style vested in relationships
Foundation for new management theory to start with the
pre-requisites necessary for the development of relationships
and emotions
Constructive and destructive states of mind
Constructive states of mind
Foundation for constructive
relationships
Build
• Self-respect
• Self-esteem
• Integrity
• Compassion
• Commitment
• Benevolence
• Generosity
• Loyalty
• Love
Create
• Confidence
• Responsibility
• Trust
• Passion
• Honesty
• Ambition
• Motivation
Source: Flanagan, cited in Goleman
(2003, Chapter 3)
Destructive states of mind
Build
• Low selfesteem
• Jealousy
• Dislike
• Selfishness
• Meanness
• Hatred
• Alienation
Create
• Overconfidence
• Irresponsibility
• Mistrust
• Negativity
• Deceit
• Self-ambition
• Complaints
Shared purpose
“ The characteristics of self-awareness, self-worth
and social worth provide the drivers for the attainment
of high levels of emotional intelligence and provide the
foundation for sustainable relationships” [Goleman et
al, 2002]
An organisational dream that seeks to promote a better society
has meaning for all those connected with the organisation
 This creates a purpose that can be shared by all those in the
organisation
Collins and Porras (1994, pg 55) state that companies which only
focus on profitability did not perform as well as those whose focus
transcended economic considerations
An example of management innovation
Gary Hamel provides an example of a new management
model developed by an Indian IT company,
which is built on principle of ‘reverse accountability’
The model provides for:
the rating of bosses by employees, and bosses bosses, and
all ratings are published online
“secret” corporate strategies are made available to
everyone in the organisation (all 8000 employees) who then
help to build on the strategy
the introduction of a ticketing system, whereby even a first
level employee who has any issue that (s)he wishes to raise
with management , may fill out a ticket (which is available for
all to see). Only that employee can close the ticket, once
(s)he feels it has been adequately dealt with. Where the
ticket has not been resolved within 24 hours by
management, it gets escalated to the next level
Another example : The “Toyota Way”
“genchi genbutsu,” solving problems at the
source instead of behind desks:
First line employees on the factory floor
are given the power to be problem solvers,
innovators and change agents
They are given the skills and tools and
permission to solve problems as they arise
Ability to harness the intellect of
“ordinary” employees
Empowering factory workers has long
been central to Toyota’s quality control
The Toyota Way:
Constant creativity
Colored bar charts against a white bulletin board, in plain view
for all to see, represents the work targets of individual workers,
visibly charting their successes or failures to meet those targets
The idea is not to humiliate, but to alert co-workers and enlist
their help in finding solutions
Becoming a Management Innovator
These are just some examples of an
innovation around a management model
The bottom line is: there is no
immediate recipe for success in developing
your management model—there are many
valid approaches
The management innovator needs to
balance revolutionary thinking with practical
experimentation to “feel” his or her way to a
new, innovative management model
How do I initiate management innovation in
my organisation?
•Think outside the box..identify a problem that requires fresh thinking
• Deconstruct conventional thinking that might constrain creative
thinking
•Search for new principles
•Learn from the fringe - study the practices of organisations that are
unconventional
•Be more inventive and less tradition bound
•Learn, study and apply the best current thinking
•At first, design low risk innovations that let you test your
management models without disrupting the entire organisation
The world we live in today to be
reflected in our management models
 Characteristics of the world we live in today:
 Individuals are committed to the purpose of the organisation
Organisation driven by common values and shared beliefs
The fear of failure is eliminated
Individuals do not feel restrained by rules and regulations,
systems and processes
“Discovery consists of seeing what everybody has
.
seen
and thinking what nobody has thought.”
Albert Szent-Györgyi (1893 – 1986)
U.S. winner of the Nobel Prize in physiology or medicine
Presented by:
Name of presenter:
Position in firm:
Firm name:
Disclaimer- Whilst every care has been taken in
the compilation of this seminar, presentation
and handouts, no responsibility of any nature
whatsoever shall be accepted for any
inaccuracies, errors or omissions, nor for the
accuracy of any information contained in the
seminar handouts.