Why we need new management theories

Business leaders and managers are in a quagmire these days. After heralding the benefits of work-from-home (WFH) in the last two years, they now want the employees back to the office.

Take the example of Google. Starting April 4, workers are required to come into company headquarters three times a week, as reported by Fortune.

Apple Chief Executive Tim Cook, on the other hand, told his employees in a March 2022 memo, “I can’t tell you how much I am looking forward to being together again,” as reported by CNBC. The memo outlines Apple’s April 11 hybrid back-to-work plan. “A new wave of companies, including tech giants like Meta and Apple, are starting to try to coax (or summon) their workers back to their headquarters.”

 

Even President Joe Biden wrote a letter to federal workers telling them to show Americans the time is right to go back to work as Covid cases decline. He even urged all Americans in his March 1 State of the Union address that “It’s time for Americans to get back to work and fill our great downtowns again,” and “People working from home can feel safe to begin to return to the office.”

In the Philippines, the National Economic and Development Authority announced that the business process outsourcing (BPO) industry, the largest private sector employer, should “go back to the office” starting April 1, 2022, as doing so would help boost economic recovery. Many private companies have also started implementing hybrid work, i.e., part WFH and part in the office.

 

While hybrid work is being welcomed by both management and employees with the decline in Covid-19 cases, it won’t be around much longer, according to Laszlo Bock, former chief of Google human resources and current CEO of Humu as reported by Fortune. He refers to this approach by management as ‘boil the frog method’ to subtly compel employees to go back to the office thereby avoiding difficult questions and conflict.

He further told Fortune that “executives are reluctant to accept permanent work-from-home models” and that “this could be due to the large investment that companies make when buying luxury offices; but it could also have to do with management itself.”

“Most executives have been working in offices for 20 to 30 years, so it’s comfortable for them. It’s the environment in which they know how to lead,” according to Bock.“They want to go back to what is familiar, and they believe their experience trumps what Humu’s science shows: A hybrid model is better for productivity and happiness than being in the office five days a week.”

 

Employees are pushing back. A Bloomberg report early this year said that “more than half of workers would consider quitting before returning to the office”.A survey in India conducted by recruitment and staffing firm CIEL HR Services showed that employees are even ready to quit the job if that option is taken out. Of the 10 respondents, at least 6 were ready to resign instead of returning to the office.

There is a growing disconnect between management and employees as regards work arrangements. The Future Forum, developed by workplace-messaging platform Slack, surveyed more than 10,000 workers globally in 2021 and revealed that three-quarters of all executives reported they want to work from the office three to five days a week, compared with about one-third of employees.

How should management and business leaders approach this growing rift with employees? Are management theories and models already outdated to guide managers and business leaders in their business judgement and action?

 

A Harvard Business Review article in 2020 headlined “Are Our Management Theories Outdated?”, which likewise questioned the need for new management theories. “Even management academics are distraught, doubting that old management theories still apply in organizations ruled by algorithms, and wondering whether anyone is up to developing new ones,” the author averred.

Scientific management, human relations, systems management, contingency management, shareholder value maximization. These are just some of the management theories that have moved the practice of management over the part century, explaining and justifying the action of business leaders.

But the desire of workers to work from home, coupled with the increasing automation and digitization in the workplace is challenging the age-old management theories.

 

Take for instance the scientific management theory, also known as Taylorism, which suggests that a manager’s job is to increase efficiency in a production system. By applying analysis and synthesis of workflows, the manager can address the most common source of error – people.

This approach is still being practiced by business leaders and managers, who desire to see their employees in the office in order to coach them, converse with them, and effectively “manage” them.

This is why, as an educator and practitioner of management, I argue that we need new management theories to balance the need of employees for flexibility in a remote work set up with the desire of management to increase productivity and efficiency of workers.

 

One concept I stumbled upon was the “self-efficacy theory” from the journal paper by Staples, Hulland, and Higgins written in 2016. Self-efficacy is a person’s belief in their ability to succeed in a particular situation. Psychologists describe these beliefs as determinants of how people think, behave, and feel.

The authors investigated how virtual organizations can manage remote employees effectively. The research used self-efficacy theory to build a model that predicts relationships between antecedents (i.e., physical conditions, satisfaction with management, job stress, ability to cope, etc) to employees’ remote work self-efficacy assessments and their behavioral and attitudinal consequences. Because many of these antecedents can be controlled to some extent by managers, these findings suggest that it may be possible to enhance employees’ work performance through management efforts to improve employees’ remote work self-efficacy.

Self-efficacy theory is just one new management theory to explore, but I’m sure there are others that can be part of the management education and training. It’s incumbent upon us business leaders and managers to be open to new ways of thinking.

The author is the Founder and CEO of Hungry Workhorse, a digital and culture transformation consulting firm.He is a Fellow at the US-based Institute for Digital Transformation. He teaches strategic management in the MBA Program of De La Salle University. The author may be emailed at rey.lugtu@hungryworkhorse.com

The opinion expressed herein does not necessarily reflect the views of these institutions and Manila Bulletin. Know more about #FINEXPhils through www.finex.org.ph.

Source: https://mb.com.ph/2022/05/03/why-we-need-new-management-theories/