Bill Young |
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| The Human Side of Enterprise |
work, The Human side of Enterprise, but it is nevertheless relevant
to modern Procurement. McGregor’s insights into human
behaviour are simple, elegant, and increasingly important to
modern organisations. We all recognise the inspiration that comes
from working in motivated, high performing teams and have
wondered, “Why can’t it be like this all the time?” (e-mail me if you
can name the song this quote comes from) but, in trying to
replicate it, most of us get lost in organisation charts and control
procedures.
McGregor cuts through all of this, to identify what really motivates
people, and comes up with two models of behaviour, Theory X and
Theory Y. He convincingly builds the case that each leads to a
distinctly different cultures and performance: Theory X is
command-and-control whereas Theory Y is empowering and they
create, respectively, vicious and virtual circles of behavioural
feedback. Sounds obvious? Perhaps, but McGregor goes deeper
in order to expose fraudulent and manipulative techniques in which
managers ‘sell’ ideas when it is patently clear that employee
dissent is not an option.
OK, before I go on, I have to admit that McGregor first published
his principles in 1960. He had spotted large differences in
management styles in post war industries and applied his intellect
and energy to a difference-analysis of behaviours and
performance. But an amazing thing about this book is its
freshness. Maybe it is because McGregor was so thorough,
outlook is optimistic but the modern reader may wonder what we
have achieved in the last forty five years: could we really have
gone backwards?
McGregor was inspired by, and wrote a lot about, the Scanlon Plan,
which is a good thing because Joe Scanlon didn’t. I have to admit
that I had never heard of Joe Scanlon but it seems that he
developed techniques in the 1930s that we would now recognise as
part of TQM and Kaizen. The Scanlon Plan was a team-focussed
effort to improve the whole costs of manufacturing, in which the
rewards were shared amongst the contributing employees.
Though he did not write business books, his principles were
adopted by a number of pioneering firms and were exported by Dr
W Edwards Deming, together with his own work on systems, to
Japan after the war. Most of American industry however was
looking the other way and had to wait until these were ‘discovered’
in Japan in the 1970s; and the story from there on is legendary in
the Supply Chain. As you will have guessed, Scanlon Plans and
Kaizen are typical of Theory Y organisations.
McGregor also describes the shift from ‘line’ to ‘staff’ roles, as the
proportion of workers who actually make things declines and the
proportion of service staff increases. For Procurement, his insights
into the contradictions between assisting and policing are indeed
profound. He asks how employees in a service function can
reasonably expect their clients to engage and involve them when
their main role is to enforce compliance with central command.
Ouch!
The Human Side of Enterprise addresses performance appraisal,
remuneration, promotion and management development in the
same iconoclastic style and, for the most part, is bang up to date in
its observations.
This is a great business book: highly recommended. I could
include some criticisms of course but, given the standard of most
modern business publications, this would be churlish.
My copy was a recent annotated edition with many footnotes and
lots of new commentary; and it took a while for me to learn to
ignore these. They add little and interrupt the original flow.
McGregor’s insights will still be fresh and readable in 2060.