The End of Management as We Know It: Q&A with Dr. Gary Hamel (Part 1)

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What will it take to make our organizations more transparent and more collaborative? Are we focusing on the right skills to develop the next generation of leaders? How can we finally move beyond the 100-year-old, top-down—inhuman—management model?

These are some of the challenges that WorkHuman 2016 speaker Dr. Gary Hamel is most passionate about. A highly regarded academic and business consultant, Gary has been on the faculty of the London Business School for more than 30 years and is the director of the Management Innovation eXchange, an open innovation project aimed at reinventing management for the 21st century. He’s also written 17 articles for the Harvard Business Review and is the most reprinted author in the Review’s history.

Gary’s writing often touches on topics at the heart of the WorkHuman movement. In a recent article titled “The Heart of Innovation,” Gary writes, “if you want to innovate, you need to be inspired, your colleagues need to be inspired, and ultimately, your customers need to be inspired.”

We recently spoke with Gary to get his insights on management, leadership, social recognition, and the human workplace. And because Gary had so much insightful content to share, we’re publishing this Q&A in a three-part series.

In Part 1, Gary shares common challenges he sees organizations facing today and how leadership needs to change to meet those challenges.

 

  1. Can you tell me a little bit about yourself and your work at Management Innovation eXchange?

 

I’ve been on the faculty of the London Business School in the United Kingdom since 1983, although I now reside in the United States. My work at the Management Innovation eXchange (MIX) goes back about 5 or 6 years.

We started the MIX to highlight the innovation that’s going on around the world in leadership, management, and organization. We wanted to highlight the practices of a growing number of vanguard organizations that are challenging the 100-year-old, top-down, bureaucracy-infused management model that still pre-dominates in most organizations. The goal was to create a platform where progressive managers could share their experiences and where a broad community of management rebels could crowd-solve some of the most important challenges that are facing 21st-century organizations.

It was and is an attempt to take the principles of open innovation and use them to accelerate the evolution of management as a critical social technology.

We are now working inside of organizations with the goal of dramatically accelerating the pace of cultural transformation. Our goal is to help organizations escape the limits of “Management 1.0” by making their organization more transparent, more open, more collaborative, more participative, and less hierarchical.

Organizations today face a set of challenges that are truly unprecedented, and that require, therefore, unprecedented solutions. For starters, we live in a world of accelerating change where the winds of creative destruction are blowing at gale force. Problem is, our organizations weren’t built to change. That’s why incumbents so often find themselves on the back foot. Deep change, when it happens, is usually crisis driven and most change programs are really catch-up programs in disguise. So that’s a key challenge: building organizations that can change as fast as the world around them.

Secondly, competitive intensity is increasing. Prices are under enormous pressure, and commoditization happens more quickly than ever before. The only antidote: an organizational capacity for continuous break-through innovation.

Finally, you have a generation of employees coming to work who’ve grown up on the web.  They don’t want to work in traditional, hierarchical organizations, and with good reason. Only 13% of employees around the world are truly engaged in their work—so while they may be showing up physically, they’re leaving most of their initiative, imagination, and passion at home. I think it’s fair to argue that most organizations squander more human capability than they actually use. Until this changes, we can’t expect our organization to be adaptable or innovative.

So that’s the third challenge: How do you create an organization that is fully human and fully utilizes all the gifts that people could bring to work every day, but usually don’t?

 

  1. What qualities do you think define a strong leader?

 

I think our understanding of leadership needs to change. We often see “leaders” as the people at the top of an organization—individuals who are supposed to possess heroic and often paradoxical skills. They are supposed to be visionary yet practical; bold yet prudent; strong yet compassionate, demanding yet supportive. And the fact is, not many leaders meet all these criteria.

The real challenge today is not finding an extraordinary CEO and top team, but developing the leadership capabilities of everyone at every level. Historically, the real barrier to doing that is an internal caste system that segregates thinkers and doers. Most see their role as simply doing their job, and not worrying about the broader challenges facing the organization—like creating new businesses, re-imagining core processes, or improving the culture.

As a result, we underutilize the leadership talents of millions of human beings. That’s a terrible waste, and it is becoming less and less tenable.

There’s a second reason to rethinking our views on leadership.  We are living in a culture that is increasingly authority-phobic. The millennials are very skeptical, and appropriately so, of positional authority. Over and over they’ve seen leaders who abused their authority or had their heads in the sand.

The late Karl Deutsch, who was a professor at Harvard, once said, “Power is the ability not to learn.” When you sit at the top of the pyramid and you start to believe that you’re smarter than everyone else, it can sow a certain kind of arrogance and complacency. We see all these incumbent organizations that missed the future, despite being led by extraordinarily well-paid, and supposedly brilliant, individuals. I think this has made many people skeptical of leadership and authority.

The web is the social touch point for most young people today. On the web, authority doesn’t trickle down, it trickles up. Nobody gives you authority, you earn influence by creating value for the people who follow you. The web isn’t flat. Some people online have more influence than others, more people follow their blogs, read their tweets, favorite their comments, and so on. But you only have authority to the extent that you are serving others and creating value for others.

On the web, leadership is the exact reciprocal of followership—if you don’t have willing followers, you’re not a leader. This is the point of view millennials bring to work.  If you have to use your positional power to get things done, if you have to mandate, then you’re not a real leader, and you’re undermining your leadership capital.

Historically, leadership meant having more information and more facts than your subordinates. It meant having more discretionary authority. It meant you having unique access to the leaders above you, and the ability to influence their thinking. It meant having the power to command and then to impose sanctions if people didn’t follow through.

Today, people expect a very different set of traits from their leaders. They want people who are great mentors, who are unselfish enough to put the success of those around them above their own personal success. They’re looking for people who live in the future, who have a compelling point of view about how to shape the world and how to create new opportunities.

They’re looking for people who are connectors—who look at the resources, assets, and people in the organization, and see the opportunities to put them together in new ways. They want leaders who are ‘bushwhackers’—people who can help you bust through the rules and the hierarchy to get things done. This new model of leadership is a challenge for more traditional leaders because it leaves little room for command and control.

The upside of this shift is that it will unlock the leadership gifts of people 3 or 4 or 7 levels down in their organizations.  They will learn that they can have an impact all out of proportion to their formal power; that getting things done is not about formal power. It’s about having a compelling point of view, about being selfless, being smart and being creative in building coalitions of people together who share your views. It’s about using the social media tools inside your organization to create a groundswell. It’s about putting pressure on the people that need to change.

Nevertheless, there’s still a lot of learned helplessness in most organizations. But my message is this: You are only disempowered if you chose to be.

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