Time to trust the workers

Roger Trapp says companies are wasting the potential of their `greatest asset'

On the face of it, the problems at Marks & Spencer and the Rover car company have nothing at all in common. Until the end of last year, the retailer was reckoned to be Britain's most admired company, picking up management awards while enjoying a seemingly impregnable position in the high street. Rover, by contrast, had in its various manifestations been struggling for years.

But the sharp fall in profits and the boardroom row leading up to the appointment of Peter Salsbury to succeed Sir Richard Greenbury as chief executive is similar to the just-lifted threat to Rover's Longbridge plant in that it calls into question this nation's ability to compete on what is increasingly a world stage.

After all, different as they are, these are not isolated instances. Industries that we are supposed to be good at, such as banking and music, are now largely in overseas hands, while in hardcore sectors, such as engineering and car-making, the picture is even bleaker.

Barclays pulled out of investment banking and, casting about for other ways to keep the shareholders happy, lost its thrusting chief executive. EMI, shorn of the Thorn part in a demerger designed to "enhance value", has become a subject of constant takeover speculation.

Add this to last year's report from McKinsey, the management consultancy, that showed Britain languishing some way behind its supposed competitors in terms of productivity and the continuing dismal figures for investment in research and development, and the story gets even sorrier.

British business seems content to bumble along. Retailers complain about sluggish sales but seem unconcerned about their inability to supply what people want; exporters claim that they have brilliant products but cannot attract buyers because the strong pound makes them unattractive; manufacturers seem intent on making what they want rather than what the market demands.

Beneath the surface, it is clear that there is widespread dissatisfaction with how business operates. Nor is this just a view held by trade unionists and other traditional business-bashers.

In fact it is more likely to be voiced by the legions of people, often long-serving middle managers, "let go" in the early years of this decade as large companies used the recession as a smokescreen for starting the large-scale restructurings, consolidations and downsizings that, whatever the rhetoric, are still going on today.

Words such as "trust", "loyalty" and "commitment" pepper the management consultants' lexicons. But it is the perceived lack of such qualities among the highly-paid captains of industry that is causing such a groundswell of ill-feeling.

Though such people are supposedly so well remunerated largely because of their intelligence, vision, insight and the rest, they seem to struggle with the notion that living under an almost constant shadow of redundancy does not exactly create a feeling of well-being, let alone encourage the risk-taking upon which growth and innovation, the latest buzz words, depend.

And for all the positive messages put out by gurus and consultants - who are often already living the free-agent life - many do not find the prospect of being knowledge workers for hire to the highest bidders more alluring than working through the ranks with one employer.

There are, of course, exceptions. Sir Stuart Hampson, chairman of John Lewis, has spoken out in defence of being an employee, and not just for sentimental reasons.

"The threat of unemployment is inimical to flexibility: people hold on to what they are doing, instead of moving to what they could do best, what they enjoy most, what would contribute most to the success of the company," he says.

More and more consultants and executives are starting to move in this direction by talking about the keys to success being based around such "soft" issues as passion, trust, purpose, values and integrity. All of these are fine words that can genuinely inspire if the rhetoric accords with the experiences of employees, customers and other members of the stakeholder society.

Accordingly, increasing numbers of companies around the world are realising that survival in the 21st century is going to require adherence to a new set of principles, or rules of engagement. Without being too prescriptive about what these principles or rules are, it seems that they should centre on such issues as passion, commitment, sense of purpose, values, integrity and respect.

But this is not to say that rigidly following a single approach will do the trick; the strength of the principles behind the computer and electronics company Hewlett-Packard or 3M - the diversified industrial company most famous for Scotch tape and Post-it notes - is that they provide guidance rather than answers and so enable whoever is leading the company at a given time to make shifts into new markets or in management style confident in the knowledge that such moves are not leading in inappropriate directions.

Obviously, it is up to the most senior executives to make employees, customers and suppliers feel good about the organisation by making the right sorts of products, selling them in the right sort of way and generally setting the tone.

But the sort of thing that really fires up employees is what happens at the coalface. In organisations that understand the rules of engagement, middle managers are not hapless overheads despised in equal measure by cost-cutting chief executives and long-suffering employees. They make a difference.

Moreover, if it is increasingly true that marketing is now too important to be left to the marketing department and that human resources strategy cannot be consigned to the human resources department, it is certainly the case that leadership has outgrown the traditional leadership cadre.

There is a need for British companies to adopt some of the thinking of their continental European counterparts and challenge the US notion of the chief executive as demi-god. The advent of empowerment and flatter structures means that, in effect, we are all leaders now.

To see this in action, one only has to look at a company such as AES, a Virginia-based power-generating company that has attracted a lot of attention because of the way it has devolved power and decision-making to employees.

A Wall Street Journal article of July 1995, referred to in John Case's book The Open-Book Management Experience, described how a "cash-investments task force" comprising plant technicians was put in charge of investing the money in the company's Connecticut plant's reserve fund. Charged with putting the money in various forms of debt instruments, the employees were given a basic course in finance and left to get on with the job. As Case writes: "They investigated interest rates. They placed the buy- and-sell calls to brokers each week. They made the decisions."

It is all part of a business philosophy that was developed by Dennis Bakke and Roger Sant, the company's founders, which says: "We all want to be part of a community and to use our skills to make a difference in the world."

Sant's view is that taking this kind of approach had enabled the company to grow from fewer than 600 people in 1993 to nearly 10 times as many five years later.

Though many might feel that Virgin is all Richard Branson, the famously nonconformist business leader seems to have moved some way from the idea of the all-knowing chief executive by promoting the efforts of various lieutenants who are given great responsibility for various parts of the business.

The problem for British industry as a whole, though, is that few organisations have yet grasped the reality of workplace democracy in its truest sense so that they can devolve the running of their operations to teams.

Most companies are alienating their workforces - those people they insist are their greatest asset - and thus landing themselves with demotivated overheads rather than enthused partners.

As a result, they are putting themselves at a huge disadvantage when it comes to coping with the threats and opportunities posed by the development of the single European currency, the growth of the internet and rampant globalisation.

n Adapted from Roger Trapp's book, `Blunderboss', published this month by Capstone at pounds 12.99. To order call 01865 798623.

News
In 2006, Pluto was reclassified as a 'dwarf planet'
scienceBut will it be reinstated?
News
Jennifer Lawrence at the Vanity Fair Academy Awards party in February 2014
people12 undisclosed female victims are seeking $100m in damages
Arts and Entertainment
Adam Levine plays a butcher who obsessively stalks a woman in Maroon 5's 'Animals' music video
music'Animals' video 'promotes sexual violence against women'
News
people Biographer says cinema’s enduring sex symbol led a secret troubled life
PROMOTED VIDEO
Voices
voicesI like surprises - that's why I'm bringing them back to politics, writes Nigel Farage
News
Bear and hare woodland scene from John Lewis Christmas advert
newsRetailer breaks with tradition, selling real festive fir trees online for the first time
Arts and Entertainment
Anthony Horowitz will write the next 007 novel
booksAnthony Horowitz to write new instalment in spy series for 2015
News
British actor Idris Elba is also a DJ and rapper who played Ibiza last summer
people
News
people

Kirstie Allsopp has waded into the female fertility debate again

Sport
Kicking on: Nathaniel Clyne is relishing the challenge of the Premier League after moving from Crystal Palace
footballSurprises include a first ever call-up for one Southampton star
News
ebooksAn unforgettable anthology of contemporary reportage
Voices
4 May 2013: The sun rises over Tower Bridge in London. Temperatures across the UK could be higher than several European holiday destinations by Monday, including parts of Italy and France (Andy Hepburn/PA)
voices
News
The moon observed in visible light, topography and the GRAIL gravity gradients
science

...and it wasn't caused by an asteroid crash, as first thought

News
Researchers say a diet of fatty foods could impede smell abilities
scienceMeasuring the sense may predict a person's lifespan
News
newsGlobal index has ranked the quality of life for OAPs - but the UK didn't even make it into the top 10
Extras
indybest
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Trust Accountant - Kent

NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...

Graduate Recruitment Consultant - 2013/14 Grads - No Exp Needed

£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...

Law Costs

Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...

Day In a Page

Italian couples fake UK divorce scam on an ‘industrial scale’

Welcome to Maidenhead, the divorce capital of... Italy

A look at the the legal tourists who exploited our liberal dissolution rules
Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

The vintage series has often been criticised for racial stereotyping
An app for the amorous: Could Good2Go end disputes about sexual consent - without being a passion-killer?

An app for the amorous

Could Good2Go end disputes about sexual consent - without being a passion-killer?
Llansanffraid is now Llansantffraid. Welsh town changes its name, but can you spot the difference?

Llansanffraid is now Llansantffraid

Welsh town changes its name, but can you spot the difference?
Charlotte Riley: At the peak of her powers

Charlotte Riley: At the peak of her powers

After a few early missteps with Chekhov, her acting career has taken her to Hollywood. Next up is a role in the BBC’s gangster drama ‘Peaky Blinders’
She's having a laugh: Britain's female comedians have never had it so good

She's having a laugh

Britain's female comedians have never had it so good, says stand-up Natalie Haynes
Sistine Chapel to ‘sing’ with new LED lights designed to bring Michelangelo’s masterpiece out of the shadows

Let there be light

Sistine Chapel to ‘sing’ with new LEDs designed to bring Michelangelo’s masterpiece out of the shadows
Great British Bake Off, semi-final, review: Richard remains the baker to beat

Tensions rise in Bake Off's pastry week

Richard remains the baker to beat as Chetna begins to flake
Paris Fashion Week, spring/summer 2015: Time travel fashion at Louis Vuitton in Paris

A look to the future

It's time travel fashion at Louis Vuitton in Paris
The 10 best bedspreads

The 10 best bedspreads

Before you up the tog count on your duvet, add an extra layer and a room-changing piece to your bed this autumn
Arsenal vs Galatasaray: Five things we learnt from the Emirates

Arsenal vs Galatasaray

Five things we learnt from the Gunners' Champions League victory at the Emirates
Stuart Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

This deal gives England a head-start to prepare for 2019 World Cup, says Chris Hewett
Ebola outbreak: The children orphaned by the virus – then rejected by surviving relatives over fear of infection

The children orphaned by Ebola...

... then rejected by surviving relatives over fear of infection
Pride: Are censors pandering to homophobia?

Are censors pandering to homophobia?

US film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence
The magic of roundabouts

Lords of the rings

Just who are the Roundabout Appreciation Society?