Bertrand Duperrin's Library tagged marketplaces → View Popular, Search in Google

Nov

2011

First, Let's Fire All the Managers

"Management is the least efficient activity in your organization.

Think of the countless hours that team leaders, department heads, and vice presidents devote to supervising the work of others. Most managers are hardworking; the problem doesn’t lie with them. The inefficiency stems from a top-heavy management model that is both cumbersome and costly. "

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management marketplaces markets supervision hierarchy decisionmaking casestudies morningstar

Their job is to keep the organization from collapsing under the weight of its own complexity. Assuming that each manager earns three times the average salary of a first-level employee, direct management costs would account for 33% of the payroll. Any way you cut it, management is expensive.
Give someone monarchlike authority, and sooner or later there will be a royal screwup. A related problem is that the most powerful managers are the ones furthest from frontline realities. All too often, decisions made on an Olympian peak prove to be unworkable on the ground.
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- Third, a multitiered management structure means more approval layers and slower responses. In their eagerness to exercise authority, managers often impede, rather than expedite, decision making.
- markets work well when the needs of each party are simple, stable, and easy to specify, but they’re less effective when interactions are complex
- Managers do what markets cannot; they amalgamate thousands of disparate contributions into a single product or service
- Wouldn’t it be great if we could achieve high levels of coordination without a supervisory superstructure? Wouldn’t it be terrific if we could get the freedom and flexibility of an open market with the control and coordination of a tightly knit hierarchy? If only we could manage without managers.