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Management Fads That Don't Work

Ilya Leybovich | Jan 18, 2011 |

Every few years, a new management philosophy sweeps the business world. How can managers distinguish between a passing fad and a lasting
methodology?

(Related: Stay on top of the latest industrial activity through the new Thomas Manufacturing Index)

Management philosophies are as diverse as managers themselves, with new concepts and strategies emerging every few years to steal the spotlight from
earlier trends. But while some management concepts tap into essential notions of leadership and effective organization, proving useful for years or even
decades, many others fall by the wayside.

What are the criteria separating strong, sustainable management philosophies from passing fads, and why are so many managers prone to accepting fads in
the first place?

"From The One Minute Manager to Who Moved My Cheese?, new and revived leadership concepts have shaped the way we organize, evaluate, inspire and
reward team members," Bloomberg BusinessWeek explains. "With so many competing management theories in the mix, some ill-conceived practices were
bound to take hold — and indeed, many have."

The proliferation of various business philosophies and methodologies, including many that borrow ideas from one another or build upon each other's
concepts, means that many undeserving approaches slip past the gate and are embraced within a company. Of course, management fads eventually reveal
themselves by providing inadequate results or yielding the wrong kind of results, but the cost of pursuing a misguided strategy can be severe.

It's not easy to tell whether a particular strategy will turn out to be a fad, but BNET offers the following list of questionable management philosophies from
the past and present:

Six Sigma — Employees are assigned various rankings based on their expertise in Six Sigma methodology and are tasked with improving
processes by spotting and rooting out defects. The problem often lies in the fact that this system creates a hierarchy of "experts" in multi-
colored belts who may interfere with other people's work solely because they know the Six Sigma concepts. Many meetings ensue, but the
results may not be worth the time spent.

Business Process Reengineering — Cross-functional teams are created to reorganize separate tasks into complete cross-functional processes
and integrate business functions through enterprise resource planning or supply chain management. It's not as complex as it sounds: the
"reengineering" often simply leads to layoffs across the board, which are rationalized by the business philosophy.

(Related: Stay on top of the latest industrial activity through the new Thomas Manufacturing Index)

Matrix Management — People with similar skill sets are grouped together for work assignments, meaning each employee may have to work
under multiple managers at a given time. Unfortunately, this can lead to managers fighting each other for authority and cause productive work
to grind to a halt.

Management by Consensus — All proposals are developed collaboratively and important decisions are made only with the agreement of
everyone in the group. Although it avoids the "top-down" corporate process, management by consensus tends to reinforce the status quo
because only the most easily agreed upon decisions pass. Tough choices are rarely made and occasionally the group may pursue a course of
action that no individual member wants.

Core Competency — The company focuses on the one thing it does better than its competitors and works to further excel at it, keeping rivals
from imitating or catching up. The problem is that the members of an organization may not recognize what they're truly best at doing, and the
company's success may actually be due to something other than what people think. This strategy also balances the company's future prospects
on a single business component, making it difficult to adapt to changing needs.

Management by Objectives — Managers and employees agree to a clear set of objectives for the company and then measure their actual
performance against the pre-set standards. However, the future can be unpredictable and changes come suddenly. By planning ahead too
much, employees may end up using strategies that only would have worked a year ago, or they may need to use a new approach and then spend
more effort to make it look like they were following the predetermined plan.

Search for Excellence — Management strives to solve business problems with as little process overhead as possible, while empowering
decision-makers across organizational levels. This often causes companies to imitate other firms through "best practices" or to implement
otherwise successful
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 "Some of these ideas catch fire. They capture public imagination and their authors become stars overnight. When this occurs, sensing profit, other
Insights Articles in
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workplace Industry
blog Managing Leadership says. "There are certainly vastly more potential clients desperate Insights
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by directors and shareholders as applying cutting-edge thinking than can be handled by the originators of that thinking, so the new entrants easily attract
business."

So what differentiates a fad from a legitimate management concept?

According to the Harvard Business Review, fads are typically: simple, relying heavily on buzzwords, acronyms and reductive ideas; prescriptive, listing
actions to take under specific circumstances instead of supporting interpretation; falsely encouraging, promising to deliver big results; one-size-fits-all,
taking little or no account of differences between companies; novel instead of radical, meaning their originality is superficial; and supported by gurus or
disciples, constantly touting the prestige of adherents rather than using hard performance data.

In contrast, a management philosophy that has staying power not only lacks the characteristics of a passing fad, but also displays a level of intricacy and
nuance that reflect the realities of day-to-day business.

"Classics typically arise not from the writings of academics or consultants but emerge out of practitioner responses to economic, social and competitive
challenges," HBR explains. "They are complex, multifaceted and applied in different ways to different businesses. The classics don't come with simple
primers on how to make the changes they propose nor do they have simple rules everyone must follow or any guaranteed outcomes."

It is important to note that opportunities and positive results can come from these methodologies. Six Sigma, for example, has been able to transcend its
roots in manufacturing and branch out into other disciplines. Yet simply rolling out Six Sigma practices is not a silver bullet. Making operational
improvements last requires not only a change in processes, but a change in mindset as well. Often the reason such methodologies don't work is because
leaders fail to realize that making real progress in improving operations comes not only with implementation but with sustaining these strategies.

"Without sustainment, you simply run in place. ... [D]ecade after decade we seem to re-discover and re-apply a newly branded version of problem-solving
methods to get better at what we do," according to Raphael Vitalo and Joseph Vitalo of business consulting firm Vital Enterprises. "We have many tools and
lots of energy for uncovering opportunities and making improvements, but we seem to have few if any tools and little excitement for ensuring that the
improvements we develop sustain."

Earlier

Tips for Developing a Company Philosophy

The Many Types of Monster Bosses

An Idea So Crazy it Might Work: Tips for Disruptive Thinking

Resources

Ten Management Practices to Axe

by Liz Ryan

Bloomberg BusinessWeek, Feb. 5, 2010

The 8 Stupidest Management Fads of All Time

by Geoffrey James

BNET, Oct. 12, 2010

Getting What You Pay For

by Jim Stroup

Managing Leadership, Nov. 6, 2008

Spotting Management Fads

by Danny Miller and Jon Hartwick

Harvard Business Review, October 2002

The Fatal-Flaw Myth

by James Surowiecki

The New Yorker, July 31, 2006

Sustaining Lean Initiatives: Lessons Learned

by Raphael L. Vitalo and Joseph P. Vitalo

Vital Enterprises, April 2006

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