Book Review: The Management Myth: Why the "Experts" Keep Getting it Wrong - By Matthew Stewart

management myth"How can so many who know so little make so much by telling other people how to do the jobs they are paid to know how to do?" The answer to this question, posed by a professor of author Matthew Stewart, is basically the entire volume of The Management Myth, itself. This darkly funny, brutally detailed look at the management consultant class manages to unveil nonsense and presumptions of everyone involved in corporate life in America, from current gurus like Tom Peters (In Search of Excellence) to modern-day Fortune 500 company heads to the worshipped founders of business schools and management theory.

By SusanG at DailyKos. The Management Myth: Why the "Experts" Keep Getting it Wrong - By Matthew Stewart - Hardcover, 352 pages - W.W. Norton & Co., New York - $27.95

Along with the money has come a whole lot of admiration for the great leaders of the corporate world. University leaders, philanthropists, hospital administrators, and politicians promise to manage their fiefdoms like CEOs manage their companies .... When Jesus is compared with a CEO, it is Jesus who is thought to gain by the comparison. Whether the problem is a soul in search of salvation, a relationship on the rocks, or a superpower in trouble, according to the received wisdom the answer is to turn it into a private corporation and then manage it like a CEO.

Stewart's personal story exemplifies the ludicrousness of the consultant trade in a nutshell. Armed with no business experience or even a record of academic business classes--but a Ph.D. in Philosophy from Oxford!--he interviewed on a lark for a consultant position, urged on by a friend with about as much business experience as Stewart who'd struck gold with a firm with a top-tier firm.

Luckily for readers, Stewart was hired ... and spent years on the front lines taking notes like an embed in the consultant industry, rising from a low-level (but highly compensated) hire to founding partner of a spin-off firm, a company that (ironically) ended badly in a tangle of lawsuits and textbook examples of bad management practices.

Alternating tales of his own personal rise and disillusionment with the industry with historical background on how business education and business management became its own field in the first place, Stewart's keen eye and biting insight provide a work that is both entertaining and informative. And the book's timing couldn't be better; as outsiders look in on Wall Street and wonder how so many supposedly brilliant financiers could have been so wrong, Stewart's look at the underbelly of CEO's and their parasitic class of consultants provides several clues as to how the current economic crisis came about.

If any political party funded political science departments in the way that corporations fund the business schools, we would naturally consider their research to be little more than propaganda.

Let's begin, then, at the beginning, as Stewart does: with the origins of the business schools and the business of advising business itself. For many years, capitalists like Andrew Carnegie and J.P. Morgan managed somehow to create empires without paying theorists or obtaining MBA's, but that all changed when the first efficiency expert, Charles Frederick Taylor, did some very unscientific scientific studies and became if not the first, at least the most renowned (and pompous), advisor to businesses. "With this time-wasting stopwatch rituals and other grossly inefficient sacraments to the god of production," Stewart writes, "Taylor embodied the subtle madness of a new and profoundly unbalanced religion of practicality." But Taylor gave the "profession" a genesis and a scientific aura, despite the fact that later examinations of his "studies" proved them to be inaccurate and ... well, fudged. No matter. A "profession" of management and business consultancy was born, taken up and promulgated by Taylor's successors.

Medicine is a profession not on account of research in molecular biology but because it has licensing requirements, standards commissions, and policing mechanisms for controlling malpractice. The "profession" of business management as Donham and Mayo conceived it has none of these features. It merely exhorts good behavior on the basis of putatively "scientific" findings.

It's not that Stewart objects to quantification and analysis in a knee-jerk humanities/philosopher fashion. In its place, he acknowledges, statistics and projections can help chart a course and can turn up problem areas in need of attention. He also understands the place and role of leadership in organizations, even as he despairs of the "professionalization" of it.

But the modern idea of management is right enough to be dangerously wrong and it has led us seriously astray. It has sent us on a mistaken quest to seek scientific answers to unscientific questions. It offers pretended technological solutions to what are, at bottom, moral and political problems. It conjures an illusion--easily explained--about the nature and value of management expertise. It induces us to devote formative years to training in subjects that do not exist. It favors a naive view of the sources of mismanagement. Above all, it contributes to a misunderstanding about the sources of our prosperity, leading us to neglect the social, moral, and political infrastructure on which our well-being depends.

Not only does fetishization of ill-founded management theory threaten that non-corporate infrastructure to which he refers, it also often doesn't even make sense in a business context. "'Pure' analysis," he claims, "in most business situations tends to be conservative rather than creative. It implicitly favors optimizing the existing business rather than building a new one."

Still, there is a certain constructive role that outsiders can play in the modern corporation, if they keep the scope of their mission in mind. Often consultants can serve as hatchet men (or women, but usually men), for example. Or they can become the conduit of communication from one department to another in a poorly structured organization. Or ... they can just pull strategy out of the air sometimes, just to get things moving.

But overall, the business of advising business is a charade, one Stewart likens at one point to the introduction of a virus into an imperfect but moderately functioning organism. Sure, every corporation could probably use a wee bit of objective analysis, but the road to succumbing to a fatal parasitical malady usually begins with picking up an advisor on one project and then four years down the line having an entire staff of consultants in every department, sucking the life out of organizations, mandating lay-offs of employees even as the ranks of the contracted consultants swells.

And some of the modern strains of hyped business practice can be downright alarming on close examination. "Strategic planning," for example, uses projection and top-command control tactics that look an awful lot like Soviet Russia-era five-year plans, and can wind up creating the same kind of sullen, drag-footed compliance and stifling of innovation in the modern multinational corporation.

And most of the best business practices come down to common sense, anyway, Stewart maintains. After living the advising life and bailing on it, he's embarked now on a new writing career that's refreshing, bold and valuable. In The Management Myth, Stewart not only bites the hand that fed him--he cuts it off, chews it up, spits it out and examines its anatomy so that those unfamiliar with the practices of that invisible hand can benefit from knowledge of its previously invisible ways. Out of these shadows emerges the credo of the consultant--and the corporate--class:

Hire the smartest people in the room, the theory goes, and they'll figure out on their own how to extract money from the other people unlucky enough to be caught in the same room.