The world of work is undergoing upheavals. Major changes are taking place in the wake of the developments and fluctuations stemming from an even greater seismic shift: the digital revolution. Underpinning the process of digitalisation that most companies are now undertaking, new approaches to the organisation of work are resulting in new production systems and opening the way for further innovation. However, a panoramic view of the new models that are intended to optimise ways of working in tomorrow’s companies raises a fundamental question: how will these changes affect people’s jobs? With the emergence of Learning by doing, flattening the hierarchy of the workplace, and an increase in flexi-work and collaborative working, the manager’s job is now a major point for discussion. In this article, we take a look at the role of the manager – first of all because managers are right at the centre of the changes taking place; secondly, because their future is being so much talked about, with predictions ranging from the realistic to the purely fantasist; and thirdly because the manager of tomorrow is likely to be in the front rank when it comes to applying new work patterns and putting forward new ideas and novel strategies to underpin them, or at the very least leading the way in the digital transformation of the organisation.
Management: a continuous revolution
The realm of freedom actually begins only where labour which is determined by necessity (…) ends
Management has already seen plenty of revolutions. Experts in scientific management theory, a discipline born out of Taylorism, have been striving over the years to adapt company organisational models to the economic, scientific, technological and social changes taking place around them and seeking to match companies’ aims and aspirations to current trends in thinking and behaviour. In all this, the manager stands as the representative of the organisation, he or she embodies the way things are done. When we study managers, we are therefore asking fundamental questions about the future of work and the thinking behind the practices. This is certainly not the first time that managers have been in the thick of change. The job of company manager is a relatively recent one, dating from the mid-19th century when the industrial revolution was in full swing. As a fiercely production-oriented view of the economy took hold, a manager was regarded as the main on-the-ground instigator of the top-down division of labour, whose job it was to ensure that the production chain ran smoothly and that work patterns and procedures were rationalised as required. The great political and social philosopher Karl Marx said that “labour itself, not merely in present conditions but insofar as its purpose in general is the mere increase of wealth (…) is harmful and pernicious”. The organisation of work, rather than limiting itself to productivity, ought to be designed to make people free to create, experiment and innovate, he argued, asserting that “the realm of freedom actually begins only where labour which is determined by necessity (…) ends”.
Over time, the old task-master/time-keeper job has morphed in a rather elegant manner into such positions as Human Resources Director. In the middle of the last century, the company organisation theorists began to see the company less as a purely mechanical entity and more in the human terms that the etymological origins of its name imply. The workforce should not be whipped into a frenzy of production but coordinated and directed in a reasonable manner. Mary Parker Follett, an American pioneer in the fields of organisational theory and organisational behaviour, was one of the first to enunciate ideas around this new trend in human relations in which the bonds of subordination, authority and domination give way to real relationships and interaction. “Responsibility is the great developer of men,” she wrote. But let us not make the mistake of believing that no-one noticed until the middle of the 20th century that workers have feelings. It is a simple basic fact that Homo economicus has always been more productive working in a group than alone and that by creating a feeling of belonging within a company, the workforce could be united in purpose, with a consequent increase in productivity and profitability. But such models inevitably only have a limited lifetime; the human factor always reasserts itself at a given moment. So it was that at the turn of the 21st century, with the distant rumblings of the approaching digital revolution just starting to be felt, company theorists began to take a holistic, strategic, cybernetic approach.
Arising out of the general systems theory promulgated by Austrian biologist Ludwig von Bertalanffy, these three approaches regard organisations as complex systems born out of a plurality of potentiality, environments, interactions and institutional structures. According to this way of thinking, the role of a manager is to harmonise countervailing forces and establish increasingly complex decision-making processes which will ultimately lead to synergies that foster innovation and help the company to stand out as a unique entity in the face of ever-fiercer competition. However, this can only be done if we are willing to see the company as a complex, shared entity which belongs to all the participants and contributors whose efforts make it thrive and blossom. Companies have been becoming more and more inclusive in recent years, the latest trend is towards becoming truly participatory. The modern company must promote a broad conversation that will challenge individuals to apply their skills and come up with ideas. It must foster lively, sometimes conflictual interaction, which will eventuality bring forth the fruits of collective intelligence.
The challenge for managers in an inclusive company
In this new world, the way companies are managed is being turned upside down. Management theory has never quite shaken free of the original Ford production model, and despite all efforts to take greater account of the human factor, they still struggle to find a way of uniting the workforce in common purpose. Perhaps this is because the standard management paradigms have been institutionalised on the basis of over-strict values which are now colliding with employee emancipation and with the need to take on board differences and promote gender parity and diversity. Thus the weight of hierarchy still bears down on innovation and on the freedom to create, stifling risk-taking, refusing to believe that employees can be real agents of change and optimise the chances of success for all. Top-down authority, hierarchical distance from colleagues and balance-of-power relationships which necessarily mean unequal entitlement to decide what should be done, tend to encourage the perpetuation of value systems which are likely to thwart the development of the inclusive company.
An inclusive company is an entity which recruits and encourages, in both its organisation and value system, a variety of people from different backgrounds. Vers l’entreprise inclusive: les 6 clés de la diversité, (‘Moving to the inclusive company: six keys to diversity’), a work compiled by IMS – Entreprendre pour la cité, a French body that promotes Corporate Social Responsibility, lists up the challenges for management trying to pursue ‘diversity initiatives’, i.e. “building a company where differences are accepted quite naturally.”
Today far too many companies are lagging behind when it comes to including minorities, whether we are talking about women, people living with a handicap, young people from deprived backgrounds, older workers, and so on. According to a report from the French Inequality Observatory (report in French) based on the latest figures from the French National Institute of Statistics and Economic Studies, some 57% of university students are women but their salaries, when total working time is taken into account, are on average 25.7% lower than for men in the same organisation. And the higher employees climb within the company, the wider is the salary gap, even though those jobs carry more responsibility. In addition to the clear moral issue, what is really detrimental here is that there is a definite correlation between this sort of discrimination and prospects for innovation at the organisation.
With this is mind, the French Association for Manager of Diversity (AFMD), founded in 2007, has set out to promote a revamp of management methods so as to bring them into line with diversity goals. The AFMD is of the view that it is “essential to progress from promoting diversity to managing it”. The Association hosts meetings between public bodies, institutions, professional associations and employer organisations to discuss “concrete and pragmatic” solutions to make diversity in companies a driver for performance. Paris-headquartered food services and facilities management company Sodexo's 2016 Global Diversity and Inclusion Report, based on the results of the company’s 2016 employee survey in over eighty countries, reveals that teams whose gender mix is between 40% and 60% achieve better business results than more ‘traditional’ units. This means that it has now become vital for managers to a more ‘inclusive’ approach going forward. This is even more important now that a new challenge to the human element in companies has arisen: the arrival on the scene of a new kind of ‘worker’, whose bodies are enveloped not in flesh but in steel, aluminium and plastic.
What to do about robotisation?
Going forward, the organisation of work at the company will have to take account of such major trends as robotisation and the development of artificial intelligence (AI). These new resources will have to be deployed and managed within the overall framework. AI has already demonstrated its usefulness at companies, helping managers to do their jobs better. Currently three main areas are affected: information systems (IS); checking for accounting/financial errors; and online customer relations. A substantial number of companies have now combined AI and IS tools with a view to improving their performance indicators. And the rapid development of AI calls for a rethink of management strategy, firstly because in the future many tasks will be automated; secondly because new jobs and new players will emerge; and last but not least because progress in AI may one day enable these systems to replace managers. Today AI systems are already able to interpret human emotions and provide users with a tailored service. Once they develop emotional intelligence on top of their algorithmic calculations, such systems will, in theory, be able to take over staff management.
In practice however, this prospect is far from a certainty. It is unlikely that, even given all the amazing progress in this field, they will ever be able to talk to people as well as other people can. Meanwhile management is today no longer perceived as an automatic process of directing staff in purely linear tasks. Management is no longer – if indeed it ever was – thought of as an exact science and it is largely recognised that human relations cannot be straitjacketed inside mathematical calculations. All those alarmist speeches warning of the imminent disappearance of the manager fail to see the issues in the round. Although companies are often seen in terms of a single structure with a single will and unified aims, the history of management shows that this has never really been the case, because the essence of a company is intelligence. Intelligence is what unites staff, hones knowhow, encourages ideation and drives creation. All this could never be done on a purely ‘artificial’ basis. A company cannot simply be run in a mechanical, robotic manner because machines cannot come up with ingenious ideas. Collective intelligence can and does. These tools will certainly serve to enhance performance, speed things up, and help managers to obtain a more profound grasp of things but they will not supplant the manager entirely. The manager of the future will have to implement a twin strategy, ensuring harmonious human relations while managing the intelligent systems so that they dovetail smoothly with the human workforce. Far from disappearing the manager’s role is likely to become more complex. Tomorrow’s manager will need to master these new tools, to understand the new processes at play in the digital company and be able to work with virtualisation, automation and robotisation. Only when they have mastered these new processes will managers be able to promote synergy among all the aspects of work at their company. The new approach will still be time-consuming and pose significant challenges. And in an ecosystem undergoing total transformation, the role and status of the manager will once again come under scrutiny.
The status of the manager in a flatter hierarchy
Liberated company: an organizational form where employees are totally free and responsible for the actions
Companies are no longer seen as static, but as dynamic, fluctuating entities in constant motion, and therefore potentially innovative. Gary Hamel, a Professor at the London Business School, author of ‘The End of Management?’, has coined the expression ‘bureau-sclerosis’ to describe the impasse faced by management in the digital era. He argues that management tends to be based on a bureaucratic approach which places managers at each hierarchical level, lengthening the decision-making cycles and complicating in-company working relationships. The weight of hierarchy tends to hinder internal communication and block the synergies that unleash creativity. Hamel’s conclusion is therefore that although the company of tomorrow wishes to be seen as inclusive and digital, it also needs to free itself from its hierarchical chains if it is to prosper. New ways of doing things and making things and the different ways of imagining the company of the future have thus given rise to a whole train of thought whose aim is to rethink the fundamentals, including of the way a company is organised at a social level. The central idea is to render hierarchical organisations more flexible, or even make hierarchies disappear altogether. This is what some people call the ‘liberated company’. This concept first appeared in 2009 in an article published in the California Management Review by Isaac Getz, a professor at ESCP Europe Business School of Management, entitled “Liberating leadership: How the initiative-freeing radical organizational form has been successfully adopted”. Professor Getz describes this new type of organisation as “an organizational form where employees are totally free and responsible for the actions they – they and not their bosses – deem to be good to undertake.”
a liberated company = a liberating leadership?
In this analysis, the company is no longer seen as a transcendent entity encompassing the economic activities of its members, but as the actual product of their activity. This radical reversal of the paradigm leads inevitably to a redefinition of what management is. At the end of the day, how can a company set itself free? Perhaps by getting rid of all the organisational and institutional practices and rituals, including the traditional organs of command and control that prevent people from expressing themselves and block the flow of energy needed for innovation. Nevertheless, the notion of a liberated company is certainly not about pursuing a caricature utopian vision – smashing the organisation, breaking up all the internal mechanisms that keep the company running, that sort of thing. Basically, it means a company where people take responsibility, which is another reason why managers are not about to disappear any time soon. When you stop focusing purely on the management organs, which tend to monopolise freedom of initiative and the resulting strategic responsibility, and instead concentrate on the workforce as a whole, the goal becomes finding a way to establish new bonds based on trust and employee motivation.
The new type of organisation is all about people and their ability to work, their capacity to act as drivers of change. Thus harmonious relations at work are based on conflicts between different ideas, upon confrontation between points of view and different approaches. Chaos is always a creative force, but you have to know how to throw yourself into it, to seize it and to have the strength to deal with it. That is precisely the role of the new manager. It is wrong to suppose that a company, whatever its size, can regulate itself naturally just as it was wrong to believe in the benevolence and efficiency of Adam Smith’s ‘invisible hand’. Liberating the company is not about getting rid of all the managers in the organisation, but about moving from a top-down authoritarian structure to a more horizontal, participatory approach. Moreover, the liberated company cannot in itself be a model, because a model is inherently fixed, static in nature, which is exactly what the liberated company is against.
The manager-as-a-service: a driver of contentment at the company
So we have seen how the company of the future will need to be inclusive, digital and liberated. Its main strength will lie in having a horizontal, human-scale organisation that enables it to harmonise, regulate and encourage sometimes contrary creative forces in order to innovate. In addition, this horizontal model is based on a structure made up of small teams, self-governing cells. To be clear, the company as a whole will not be self-managed, but each of its parts will be. So what we are talking about here is holacracy rather than autarky, which is the word that detractors of the liberated company often use in order to discredit it. The strength of an organisation made up of small groups was already described in the early 20th century by French mining engineer and business administration guru Henri Fayol, set out as a theory in 1933 by Lithuanian-born, Paris-based management consultant Vytautus A. Graicunas, and further developed in 1958 by British naval historian and public administration and management scholar C. Northcote Parkinson in his book ‘Parkinson’s Law’. These authors showed that small teams were more close-knit and achieved more while at the same time their members remained versatile. Indeed, the major risk of the liberated company is that in the longer term these small groups turn into ‘mini-companies’ within the company, making it even more difficult for the company as a whole to function well. These small self-managed teams should be part of a greater whole while at the same time retaining some functional autonomy. They will communicate with each other, within themselves and re-form and interact so as to adapt more efficiently to the challenges and situations with which they are confronted. Within each group, the members self-manage freely. This saves a lot of time and tends to increase productivity and commitment.
So the manager 3.0 will be responsible for the ‘employee experience’, as Jacob Morgan describes it in his article Why the future of work is all about employee experience. Morgan explains that this new concept encapsulates, in a sort of mirror-image of the traditional notion of the customer experience, “what happens when the employee interacts with the organisation. It covers the whole length of service of the employee at his/her company, from recruitment to departure.” Meanwhile, just as managers have evolved from being commanders to something more akin to referees and then mediators, the role of employees has also profoundly changed. As structures become flatter at many companies, the role of individual members of the workforce tends to become less that of an ‘employee’ in the literal sense – one whose time and energy are deployed in the service of the company based on orders ‘from above’ – and more that of a contributor to the overall efforts, a colleague interacting with others on a horizontal basis more than a mere wage-earner. In this situation, the manager’s core task is to enable such interactions, to help his/her employee-colleagues to interact fruitfully.
Nowadays, more and more companies and organisations are adopting these new approaches to management. As hierarchies start to disappear, power is increasingly being devolved to employees and they are being provided with a working environment and tools that foster creation. For some time now, the way Internet giants such as Google, Apple, Facebook and Amazon are structured has been held up as a model, but today, given the mix of material and emotional needs expressed by a younger generation of workers, it is companies such as Uber, freelance workshops and startup co-working and incubation spaces that are setting the new orthodoxy. Tomorrow’s companies will be founded on employee trust, empowerment, self-management, freedom and taking responsibility. Managers will therefore need to encourage and support these new approaches and ensure that the company is able to offer the right working conditions. Accordingly, in recent years we have seen some companies appointing a ‘Chief Happiness Officer’. In fact, according to figures from recruitment platform Qapa, there has been a 967% increase in the number of these new-style management posts over the past two years. As if there were any doubt, this approach originated in the United States. When he worked at Google, becoming in 2015 the first-ever Chief Happiness Officer, Chade-Meng Tan grasped the potential value of happiness in the new entrepreneurial ecosystem and has now dedicated his life to peace and happiness. But what is real happiness in a company context? This looks like being the next major issue, which the manager 3.0 will have to address.