management organisation exam

HENRY MINTZBERG ON MANAGEMENT

The Canadian, Henry Mintzberg, has been the biggest star of worldwide management for several decades. It is said that Mintzberg is the world premier among the thinkers dealing with management - following the departure of P.F. Drucker.

Henry Mintzberg is the son of a Canadian manufacturer. He graduated from an engineering course at the Faculty of Mechanical Engineering at the McGill University in Montreal. Subsequently, he acquired an M.A. degree and a PhD degree in management at the elite MIT Sloan School of Management.

Mintzberg has conducted lectures for a long time at the University of Montreal, while also at universities in the USA and France (he comes from the French-speaking state of Quebec in Canada, thus he is bilingual in English and French). Interestingly, he conducts his own original programs of teaching management, primarily for MBA studies and for working people. Indeed, he has a critical opinion about people learning management who have never worked and have never managed. It is his opinion that in such cases, it is necessary to build the basis on the real problems that the students have encountered in their lives and which they understand, while also utilize them for deepening the knowledge on the management that they do not know.

He is the author of over 150 publications, including 15 books on the subject of management. Mintzberg has made an outstanding contribution to the theory of management, particularly in the theory of the organizational roles and competences of managers, organizational structures and the theory of strategic management. Worldwide management accepted his list of 10 organizational roles most frequently fulfilled by managers (1975), as well as his theory of organizational structures, which is based on six appropriate organizational configurations (six valid organizational configurations).

He is known for his clever and frequently original syntheses and opinions relating to management, which debunk various myths and false convictions on the subject of management and those in management. I have presented a set of his views below:

Management is important to everyone as it has an impact on everyone. It is not only important for managers, but for everyone. We all need to understand it better as this leads to better practices.

Management is practice. After years of searching for the Holy Grail, the time has come to say to ourselves that management is neither a science, nor an occupation, but a practice. It is possible to learn it primarily through experience. Practice is strongly embedded in the context. Thus, the context is also important. It is necessary to understand this.

There is no single universalist management. There are however, numerous variations. Management becomes more valued and effective, the more intricate it becomes. Nevertheless, intricacy does not signify unification in everything. There is a different way to manage a private firm and another way for an administrative office, a hospital, a scientific institute, while also a military unit. It is worth transferring good role models from one of these areas to another – in as much as it makes sense and provides good results. However, it cannot be done in an uncritical way.

The essence of management is synthesis, not analysis. Simultaneously, mainly analysing is taught, during MBA studies too. Synthesis is required, particularly at the highest levels of management, while also the skill of making generalizations. Synthesis facilitates taking decisions, shaping strategies, overall management and systemic management.

Mintzberg debunks managers. He feels that managers being unmatched role models as extraordinarily effective “robots of effectiveness” is a false conviction. He claims that they are mostly absorbed by personal careers and money, while “moving from one summit to the next” (2009).[footnoteRef:1] [1: Guru Henry Mintzberg. “The Economist”, Jan 16th 2009.]

Likewise, he writes that management is an entirely natural occupation, which we tear away from its natural context and alter it into something unnatural. Later, we are unable to understand what it really is. In order to be a successful manager, it may not be necessary to be someone exceptional or extraordinarily talented. First and foremost, it is necessary to be a person who is emotionally balanced and sober-minded.[footnoteRef:2] [2: Mintzberg H., Zarządzanie. Oficyna a Wolters Kluwer 2012, s. 271]

Scepticism with regard to possibilities of academic teaching of management

Henry Mintzberg is, generally speaking, sceptical with regard to the academic teaching of management, above all due to the fact that, as he claims himself, it is extraordinarily difficult to teach management to young people who do not know how an enterprise, professional work and management look in reality. He sees more sense in work with practice with those who are really interested in the subject during post-graduate, or PhD courses, etc. These people already know how professional work and the life of an organization look, while also having some notion of what management is all about.

He is also critical of MBA studies. There are models adopted there, which he actually wrote a book about. This is testified to by the title itself.[footnoteRef:3] [3: H. Mintzberg, Managers not MBAs”. Berrett – Koehler, 2004]

We are not living in times of turbulent change as generally claimed. Mintzberg questions the common view that we live in times of turbulent change. He claims that the majority of things do not change, or change too slowly. The problem, in his opinion, is not the excess change, but rather the insufficient number of changes and the inadequate tempo of their execution – with the exception of relatively few areas. We have the impression that a lot of things are changing, including in management, as these changes are exposed to us. This is due to the fact that we only perceive what is changing. We do not perceive what is not changing and we fail to speak about this.[footnoteRef:4] In fact, we are managing in times that are less turbulent than we think. [4: H. Mintzberg, Simply managing. What Managers Do – and Can Do Better. Berett – Koehler Publishers Inc, San Francisco 2013, p. 13 – 14. ]

Unfashionable management is more important than leadership presented as trendy.

There is a lot of commotion around leadership. Nevertheless, in practice unfashionable management is still at the forefront. The fundamental characteristics of management have not undergone change. The reality is changing and managers are faced with other issues, yet they manage in the same way as up to now. The nature of their work is still the same. Apart from the frequent and short-term trends, which, in many cases are of no use, it functions as well as it has in the old way. [footnoteRef:5] [5: H. Mintzberg, Zarządzanie, Oficyna a Wolters Kluwer 2012, s. 30 - 32]

This statement by Mintzberg is probably a bit of an exaggeration. Contemporary management is being changed by the development and application of IT and new technologies.

Management is a fight against the absurdities of a system given to us and the one which we create ourselves. Mintzberg draws attention to the fact that the work of a manager is difficult as, among other things, he must function in the reality of a multitude of absurdities and restrictions. These are both imposed from the external environment, as well as from within the organization. This would also explain to a significant extent the high earnings of managers: they are the equivalent of not only the objective intricacy of the work, but also the tiring struggle with the various absurdities of risk and irritation.[footnoteRef:6] [6: H. Mintzberg, op. cit. s. 270]

JACK WELCH ON MANAGEMENT

Jack Welch became an icon of worldwide management in the last two decades of the 20th century. In that period he was the CEO of General Electric, which he altered from an average, albeit very large enterprise into the best firm of the globalized world.

Jack Welch (or in actual fact, John Francis “Jack”) was an American of Irish roots, who was the son of a conductor and a chemist by trade. He acquired the title of PhD at the age of 25. He commenced work in General Electric as a junior chemical engineer. He recalled the preliminary years of work in a negative manner due to the huge bureaucracy and lack of perspective for development. He even wanted to leave, but gave into the persuasions of one of the managers and remained. Later his career developed rapidly. At the age of 35, he became the youngest Chairman of the Board and CEO of the enterprise that enumerated 460,000 employees. Within 20 years of his management of this concern (1981 – 2001), he radically changed it. Prior to this, it was a heavy colossus with average products and performance. Welch made it the best company in the globalized world. During his tenure, the market value of GE grew by 400 billion dollars, while the share value increased 40 times.[footnoteRef:7] People who bought more shares of GE became rich. He was acknowledged to be the best manager of the 20th century in the world, not only by the Americans, but also by Europeans and Japanese people. [7: http://en.wikipedia.org/wiki/Jack_Welch. Data dostępu 11.192019]

The views of such a man on management and his activities are important and worth becoming familiar with. He was also undoubtedly a person of huge success, albeit some of his activities were very controversial. He was a man of an original personality and a “stubborn devil”.

Huge ambition, huge requirements with regard to managers and employees. Jack Welch was the enemy of bureaucracy and an advocate of dynamic, effective and efficient management. When taking the reins of GE, he set out two conditions for his directors as follows: (1) They were to be the leaders, or at least the vice leaders of what they do in the world. (2) The profit rate on products was to amount to at least 10%. If they could not do this, they were to sell their units and facilities. It seemed like madness, yet it (surprisingly) succeeded.

He was the enemy of bureaucracy and gigantomania. Within the first five years of his tenure, he reduced the employment structure by over 100,000 people - from 411,000 at the end of 1980 to 299,000 at the end of 1985.[footnoteRef:8] It was acknowledged that he managed in a brutal manner and gained the moniker “neutron Jack” as a neutron bomb kills people while not damaging the infrastructure. There were multiple quarrels and his dismissal was demanded, yet he had strong support in the supervisory board and he survived. In actual fact, he devoted the next decade or so to satisfying these very people whom he kept in the company, by ensuring managers of such high income that was virtually unattainable with the competitors. [8: When Welch took over the reins in GE, there were 100 vice-chairmen in the enterprise (!), approximately 500 higher level managers and 25,000 medium level managers. There were too many “layers of management”, as Welch himself put it. The over-hiring of managers and employees had a bad impact on the efficiency of the functioning of GE, while also flexibility, speed, openness, communication, as well as costs. Some sources provide a greater number of people made redundant than 110,000 employees.]

Radical restructuring. He radically changed the structure of business activities and products. When he took over the reins, 70 % consisted of production, while 30% consisted of services. When he left his position, 70 % consisted of services. Prior to his tenure, for over 100 years GE had mainly produced electrical goods and household equipment. Americans had sentimental ties with GE and were loyal clients (“My grandmother and mother bought goods in GE, I will also buy there and my children too”). By rejecting such sentiments, Welch changed everything. A representative example of the new products and technologies may be the monitoring of the functioning of a jet engine for every Boeing airplane in the world during the course of each flight. In the case of any worrying signals, the airplane would land at the nearest airport at which the defect was to be removed, while the passengers would embark on another waiting airplane. This radically increased the safety of flights.[footnoteRef:9] [9: John Welch – menedżer stulecia.„Zarządzanie na świecie” z 2000 r. nr 2]

Quality of products and services of key significance. Jack Welch constantly strove to make the quality of the goods and services of GE of the highest level. This was one of the principal factors of the success of GE at the end of the 1980s, which led to the outstanding economic performance. Welch applied the Japanese method of Kaizen, while also the system of Six Sigma, which was adopted from Motorola and enhanced by GE.

Mission of an organization. Jack Welch claimed that the words mission and values are the most abstract in business. They are used for the purposes of PR, while they are really important. The mission statement is by principle the answer to the following question: How do we want to win in this business? We should not promise that the firm will be everything to everyone, as this is impossible. In a nutshell, the key is profitability. Without economic success, the achievement of social aims is simply impossible.

How is a mission created? Inspiration may be acquired everywhere – it is necessary to listen to wise people. However, the board is responsible for the preparation of the mission. This task must not be entrusted to anybody who is not a member of it and directly responsible. The mission is in principle the main criteria for the evaluation of the leadership in an enterprise. Likewise, it is a real test for all those employed there.

The values of an organization should be strictly defined and understood, in order not to arouse any doubts. They are the road signs along the way to executing the mission, the means to achieve the ultimate goal – victory. In a different way to the case of the mission, all the employees should be able to have a say on the issue of values. Values are so important that the people who violate them should be dismissed, regardless of their service. This is what the employees expect. [footnoteRef:10] [10: Jack Welch, Suzy Welch, Winning znaczy zwyciężać. Studio Emka, Warszawa 2005, s. 28-32.]

Economic value of an enterprise. This should be the result of good management and not an autonomous goal. It could have seemed that Welch acknowledged the increase in profit for the shareholders as the principal aim of management. However, such an orientation was termed by him as “the most stupid idea in the world”. The value for the shareholders is the result, but not the strategy. The employees should be the most important, as well as the clients and products. If the approach is like this, the high value for the shareholders shall appear itself.[footnoteRef:11] [11: Guerrera F., Welch rues short-term profit obsession. “Financial Times”, 2009-03-12.]

In multiple university lecture halls, it may be heard that the goal of business and management is [purportedly] the creation of high value for shareholders, or, in the new version, high value for stakeholders. It would seem that Jack Welch was right.

Deficit of openness in corporations and why it is worth changing. Jack Welch had a multitude of personal problems caused by the high requirements which he set, as well as the openness he displayed and wanted to make widespread in GE. At the beginning of his career in GE, his bosses, who knew him, warned against excessive openness. Nevertheless, at the end of his mission in General Electric, he acknowledged that it was actually openness that helped him in his career the most. Welch was always aware that honest opinions and comments are received with great reluctance, particularly at the beginning. Yet he was convinced that the lack of openness would render the correct evaluation of a situation impossible, while would also destroy communication, block creativity and fast action, as well as the potential of adept people. He acknowledged that the lack of openness is ‘the real killer” in business – and not only in business. He would say: “Forget about external competitors if your biggest enemy is bad communication within your firm”.

Fast action is also important. He wrote the following: “You may be sure that a fledgling, five-person firm in your neighbourhood, in Shanghai, or in Bangalore may operate faster than you by yourself. Openness is one of the ways to keep up with them”.

Furthermore, openness is also beneficial for the reduction of costs. Make a list of all the benefits and you will be convinced that you simply cannot allow a lack of openness in your firm.[footnoteRef:12] [12: Ibidem Jack Welch, Suzy Welch, Winning znaczy zwyciężać. Studio Emka, Warszawa 2005, s. 43]

He also said that openness is difficult. He himself devoted 10 years to developing it in GE and required the next 10 years to make it widespread and long-lasting, while also reap all the benefits from it. In our culture, there are excessively strong habits of political correctness and not saying true things, but unpleasant ones.

It is also possible to add that the form is also important in terms of how we say unpleasant things and behaviour which signifies that we are not hostile, but rather amiable. The truth and relations based on the truth are necessary.

Competent people and their development is of key significance. What seemed to be in contrast to what Jack Welch did, he acknowledged the core competence of the organization to be the development of people and not double digit figures of growth. “It is ultimately the wonderful people that lead the firm to success. The CEO of GE devoted 70 - 75% of his time to his people. He proved that the ideas and people can triumph over hierarchy and tradition. Training and learning are among the most significant priorities and the greatest number of managers possible should be involved in this.” [footnoteRef:13] He created the appropriate infrastructure and allocated substantial funding for this purpose. [13: Krames J.A., Jacka Welcha leksykon przywództwa. Studio Emka, Warszawa 2003, s. 91]

Orientation towards the client is always very important. Welch constantly returned to this issue during his tenure in GE and the lack of attention to any aspect of customer satisfaction was deemed to be a “cardinal sin.” Following the implementation of the program of Six Sigma, the client and his level of satisfaction became “a real obsession” for him. Indeed, he continuously repeated the following:

- Never forget that the clients are at the epicentre of business.

- Change the orientation of your firm by adopting a perspective of seeing things “from the outside” [P.F. Drucker also said the same].

- Include the client in the structures of your firm.

- One third of the list of values of GE encompass those that are important for the clients. [footnoteRef:14] [14: Krames J.A., op. cit. s. 95 - 99]

Easy and relaxed management style, binding agent –vision. Being an enemy to hierarchy and bureaucracy, Welch adopted and practiced a free and relaxed style of management. He often met his managers, yet did not establish any rigid agenda. The managers and the employees could always speak freely. “Informalness”, became part of the culture of GE which also referred to meetings of the board.[footnoteRef:15] [15: Ibidem]

This was facilitated by the flat and transparent organizational structures, while also the aforesaid openness, As he said himself, “the vertical structure with completely ordinary people creates small generals that only communicate on an equal footing.”[footnoteRef:16] [16: Jack Welch, Suzy Welch, Winning znaczy zwyciężać. Studio Emka, Warszawa 2005, s. 142]

Development of IT technologies. At the beginning, Welch did not appreciate IT, yet he quickly changed his mind and implemented a range of initiatives that were to accelerate the development of IT in GE. He implemented an expansive program entitled “e-Business”, which encompassed, among other things, systems and solutions aimed at the protection of GE from threats created by firms operating on the Internet in the form of copying his products and solutions, while also capturing clients.

Vision as the realization of the mission and prerequisite of success. Welch was of the opinion that the mission and vision should constitute one cohesive whole. The vision facilitates the imagination, visualization and specification of the mission. According to him, GE should be the best and the most competitive firm worldwide. The vision should be simple, while expressed and enhanced by all the managers and repeated over and over. [footnoteRef:17] [17: Krames J.A., op. cit. s. 247]

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