Telling the truth about SME life today

Evolution of management over the past century

Despite the inspirational stories we read about modern companies – such as Zappos, Innocent Drinks and Google – most of us are using out-dated management practices and failing to get the most out of our people. 

Not convinced Consider this: 65 per cent of people are unhappy at work, only 14 per cent understand their company’s strategy, and 75 per cent are seeking jobs as we speak. Now, what do you think that does for your bottom line

Management thinking and practice have evolved over the last century as a result of increased understanding of human and organisational behaviour, the economic climate and historical context, and the changes in generations over time. But if we re really honest, much of what we practice today is due to the consulting industry playing on executives’s fears and aspirations by selling products and services that cause more problems than solutions, and our own human weakness of always looking for a quick fix” even to very complex issues. 

Let’s take a look in the rear-view mirror and see how we got here: 

1910s-1940s: Management as science

Management as Science was developed in the early 20th century and focused on increasing productivity and efficiency through standardisation, division of labour, centralisation and hierarchy. A very “top down” management with strict control over people and processes dominated across industries.

1950s-1960s: Functional organisations

Due to growing and more complex organisations, the 1950s and 1960s saw the emergence of functional organisations and the Human Resource (HR) movement.
Managers began to understand the human factor in production and productivity. Tools such as goal setting, performance reviews and job descriptions were born.

1970s: Strategic planning

In the 1970s, we changed our focus from measuring function to resource allocation and tools such as Strategic Planning (GE), Growth Share Matrix (BCG) and SWOT were used to formalise strategic planning processes. After several decades of “best practice” and “one size fits all” solutions, academics began to develop contingency theories.

1980s: Competitive advantage

As the business environment grew increasingly competitive and connected, and with a blooming management consultancy industry, Competitive Advantage became a priority for organisations in the 1980s. Tools like Total Quality Management (TQM), Six Sigma and Lean were used to measure processes and improve productivity. Employees were more involved by collecting data but decisions were still made u200bu200bat the top, and goals were used to manage people and maintain control.


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