Accountancy & Management: Reaching out to the next generation: Roger Trapp on the methods of a priest turned business guru

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FROM OECD reports down, British managers get a pasting. Criticised for lack of intelligence, training and attention to personnel needs, they are the whipping boys for the country's troubles. But is it all their fault?

David Hall thinks not. The head of a consultancy with close links to Durham University Business School argues that it is not the managers themselves who are to blame. It is the system.

Using models developed by his associate Gerard Egan, a US Catholic priest and psychologist turned business consultant, he has come up with a concept called second generation management, a term he acknowledges is borrowed from the world of computers.

'There are many good ideas for managing more effectively, but few comprehensive and integrated management systems,' he said. This one, he claims, 'is unique in that it does not start with the person, the skills or the role of the manager, but with the comprehensive needs of the business, and then derives the first from the last'.

Since Mr Egan's models are derived from experience gained from helping a range of organisations around the world - including British Airways, BT, Amoco, Montgomery Ward, the World Bank and the United Nations - they are not just theory.

They are tools that individual managers can use to identify, organise and capitalise on the best ideas emerging in business, adds Mr Hall.

But distinct from the ever-changing formulae that managers must develop to keep their organisation ahead of the opposition are the principles behind them. And, crucially, these are not vague catch-all notions, but ground rules fundamental to the needs of particular organisations.

Central to them is the premise that every organisation requires a shared system of management. Professional managers need a common language, an understood way of doing things, just as doctors, lawyers and accountants do, says Mr Hall. And it is the absence of this shared system that leads to the wrong people being picked for the job. So, how to get there?

Mr Egan has three models that together, he says, form a new management system. Model A looks at making the business work. It can be used to design, facilitate and assess the effectiveness of any organisation or any of its parts.

It starts with the idea that businesses need to create satisfied customers by developing committed employees, which in turn leads to financial returns.

And the way to achieve these aims is to succeed in a number of subordinate ones, such as drawing up and delivering a strategy, setting up the right operations and structures, recruiting the right people, and so on. Each subordinate aim has its own model to guide managers' thinking.

Model B is all about managing change - the concept that all the thinkers say will be the only constant in the future. It requires managers to analyse their current situation, produce a preferred one and then establish a strategy for getting there. The result, says Mr Hall, is 'action leading to valued outcomes'.

Perhaps most crucial, though, is Model C. This is concerned with managing the 'fall-out and mess' from the first two models - what Mr Egan refers to as the 'shadow side', or the things employees talk about in the lavatories.

All the management gurus acknowledge that in every organisation there is resistance to new ideas. But there is little attempt to deal with it. The thinking appears to be that the idea being peddled is so persuasive that the workforce will come around eventually.

Mr Egan is so persuasive largely because he does not believe that. He is convinced that this area has to be managed like any other. Better than any other, because the culture, politics and 'social system' of the organisation permeate every facet of the first two models, and can thus affect their success.

'The ability to understand and manage company culture is critical to effective management,' said Mr Hall.

And what does the business that successfully goes through this process to reach the second generation gain? Based on the examples of those on both sides of the Atlantic that have followed this route, Mr Hall sees benefits for customers, employees and shareholders.

Customers are less focused on price, make repeat purchases and are generally so delighted that they act as unpaid salespeople. Employees are continually learning, share in the success of the business and are highly productive and satisfied. Shareholders receive above-average returns and no nasty surprises while owning a learning organisation.

Complicated it might appear, but Mr Hall is convinced it is a workable solution to industry's present ills. Pointing out that managers are inundated with trivial tasks and have little expected of them, he believes it is perfectly reasonable for managers to do all or whatever parts of the models are required to improve their businesses.

And just to hammer home the point: 'This is not just another theory or fad. It represents a new age of hope for managers and businesses generally.'

David Hall is chairman of the David Hall Partnership of Wadworth Hall, Wadworth, South Yorkshire. Tel: 0302 852932. Gerard Egan is the author of many books on organisations and management. The latest, 'Adding Value - A Blueprint for Taking Management Seriously', is due to be published by Jossey- Bass later this year.

(Photograph omitted)

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