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Management innovation is failing us

Management innovation

I could probably write 17 million words on management innovation, but that would bore a tremendous amount of people. So, let’s not do that — and instead, we’ll write a blog post about it!

Let’s begin with the obvious. There are three major words in the first-world business lexicon that everyone misuses. Those are:

  • Innovation
  • Entrepreneurship
  • Strategy

Usually those words mean, in reality, these things:

  • An idea we copied from a competitor
  • Someone who made money younger than expected
  • Operations

Pretty logical why these words get ill-defined over time. Take strategy and operations, for example. Most guys come up in a business being told that execution is all that matters. 15 years later, when they’re at a perch where they can “set strategy,” all they do is set execution items — logistics, operations — and mistake that for strategy. This happens literally all the time at companies. You ever had a middle manager tell you what their “strategy” for something is? Half the time it’s barely an action plan. “We post to LinkedIn on Thursdays!” That’s, ahem, not a strategy. It’s an operational plan. (And it’s barely that.)

Management innovation is another thing people misunderstand at a massive scale. For example: a lot of people like to run around saying their team is soooo innovative. That’s not true — and impossible. If your entire team is Steve Jobs Jr., well, congrats. But that type of team has a major set of problems themselves. Truth is, 94 percent of business leaders are concerned (via research) that their teams aren’t innovative enough, yet still love to pound their chests about how everything is so innovative. Some of that is just posturing. Some is just cluelessness.

But there’s a dangerous way management innovation is failing us now, and we should spend a few moments looking at it.

Management innovation and the 2016 U.S. Presidential election

Look, the 2016 Presidential election is a huge topic. This isn’t a political blog, so I won’t go super deep on it here. There are about 272 different reasons why the outcome was the way it was. You’re smart enough to ID most of them.

One of the big things, though, is fear. Fear about change, especially. Automation’s coming. The Rust Belt — the states that ultimately put Trump on top — is left behind by many measures. Who exactly is leaving them behind? Well, many people — but a large chunk of it is Silicon Valley, a financial/tech hub of the past 15-20 years (if not longer than that).

Great article on The New Yorker’s website yesterday called “Silicon Valley Has An Empathy Vacuum”. I myself am not super intelligent, but I’ve said this for years. If you’ve got 25 year-old kids writing code in coffee shops and that code is automating jobs or allowing fake news to become the norm, well look … that’s a problem. Here’s a money quote from that article, which is written by a guy fully inside the Silicon Valley ecosystem:

It’s hard to think about the human consequences of technology as a founder of a startup racing to prove itself or as a chief executive who is worried about achieving the incessant growth that keeps investors happy. Against the immediate numerical pressures of increasing users and sales, and the corporate pressures of hiring the right (but not too expensive) employees to execute your vision, the displacement of people you don’t know can get lost.

And now the rubber meets the road on management innovation.

The wrong definition of management innovation

Silicon Valley loves to hide behind the mantra of “we’re changing the world” or “making the world better.” In truth, many companies love to hide behind this type of “mission statement” — when in reality, most executives are lip-servicing those ideas and chasing money like a feral cat. 

This is the first step of the problem. “Management innovation” should mean making products better, getting more from services, improving the lives of customers — and maybe even helping employees too. But to most people, “management innovation” means (a) prove growth, (b) keep stakeholders happy, and (c) get a fat-ass bonus for yourself. 




 

That’s not “management innovation.” It’s “satiation of self” or “pursuit of individual goals masked as some type of mission.” See where this is becoming a slippery slope?

Management innovation and the productivity paradox

From that same New Yorker article linked above:

As Erik Brynjolfsson, a professor at the M.I.T. Sloan School of Management, told MIT Technology Review, “Productivity is at record levels, innovation has never been faster, and yet at the same time, we have a falling median income and we have fewer jobs. People are falling behind because technology is advancing so fast and our skills and organizations aren’t keeping up.” It is, he said, “the great paradox of our era.”

Print that quote out. Slap it on your wall. It explains much of first-world business right now in a nutshell. We’re about to automate out truck driving. (Thanks, Uber and Otto!) That’s one of the only ways for someone without a college degree to make a middle-class salary. It’ll be gone in 20 years. What’s going to replace it for those guys and their sons who might have become truck drivers? Nothing. And where will they find the skill sets they need to do something else? Unclear. These are real problems.

When we talk about “management innovation,” we should be solving these problems. How can automation and AI work together with humans, or push humans to a new level? Can this be a second or third Renaissance of some kind? That would be awesome — and it might be possible.

But as long as management innovation is an euphemism for “make as much money as possible at the expense of anyone who gets in the way,” we have no chance to get there.

Management innovation and the decline of workplace ethics

A lot of this has been allowed to happen at the complex intersection of many things. We think this is the most innovative, entrepreneurial time ever. It’s not. In fact, more people are working in bureaucratic organizations than ever before. What happens in bureaucratic places? Hierarchy — and pleasing that hierarchy — means everything, especially if you want to keep your job. What happens when every VP in a company has 30+ people kissing their ass? They begin to buy their own hype — “charismatic leadership!” — and ethics in the workplace declines hugely.

As this ecosystem plays out, management innovation is allowed to be treated as a buzzword. We can all believe it’s some guitar circle of organic feedback and product iteration geared at end user value, but it means one thing. Chase the money, and chase it hard. That’s what we’ve allowed “management innovation” to mean, and as long as it means that, it’s not really management or innovation. It’s just a bunch of guys digging for nickels in the couch cushions of whatever vertical they work in. I fail to see how that solves any of the problems facing us.

What else might you add on this idea of management innovation?

Ted Bauer

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