Management 1

This article follows up on themes we’ve touched on previously, particularly in three reports, Retail, Airplane! and The Automotive Industry.

One mystery that shakes out of those discussions, is the frightening amount of bad management at businesses, and getting worse all the time.

So, big businesses often aren’t here to make money. Some small businesses, too. Which can only mean they're all about power, domination, and eventual tyrannical control. Plus, a side issue crops up, the rotted souls, or lack of souls, of the power-brokers in this world.

Businesses don’t have to be accountable or do their job, or be profitable now, as long as they have an “in” with government, which can print money at will, and feed it to them, for various “favors.”

Big business needs some reins to harness it. The book, Corporate Culture and Performance by Kotter and Heskett (1992) gives some insight. A commenter writes regarding the book, categorizing corporate control as “systemic power” in this quote:

What is desperately needed is some research into systemic power and how to avoid abusing it. To date the only hints about how to handle power are coming from business research showing that how power is applied in organizations determines profitability.

When it came to explain why some organization perform better than others the only critical factor Kotter and Heskett (1992, p.11) could identify in an 11 year study of 205 of the world’s largest organizations was corporate culture. In particular organizations with respectful cultures outperformed those with cultures that were not respectful by a huge margin:

We found that cultures that emphasized all the key managerial constituencies (customers, stockholders and employees) outperformed firms that did not have those cultural traits by a huge margin. Over an 11 year period they grew their average stock prices by 901% versus 74% and grew their net incomes by 756% on average versus 1%.

The striking thing about this, is how badly and rapidly, originally good companies (easy ones: Sears, IBM, Ford (well, maybe not Fix Or Repair Daily/Found On Road Dead/Fails On Repeated Days), Kodak, Disney) devolved. (We’ve already covered the horrors of Sears, the perfidy of IBM.)

However, the systems we use now can only be “respectful” for a limited time, because flaws are baked in the system itself, not that we’re missing research into systemic power and its abuse.

The Pyramidal System of Organization and the Absurdity of “Management”

Visualize a typical organization chart, a pyramid with a large base of powerless minions, tapering as you go up to the top point, which contains the office of the president or CEO.

What could be greater foolishness than such a layout, where all you need is a single person to come in, with a few minions to support him, to subvert the entire organization? And how strange the pyramidal structure is the only system anyone seems to use.

Presidents and “Essential Staff”

The president is absent for some reason, and the business can’t function.

That’s an absurdity.

The president leaves or retires, and all hell breaks loose.

Another absurdity.

In the meantime, in wanting to feather his own nest, who gets trained in all the knowledge that the president accrues? Often, no one.

Another absurdity.

Just how wacky is the concept of a “president?” Whether for countries or companies, it is a farce to have one point of attack, if you want to cripple, corrupt, disable or dominate a system.

As if one man knows it all, we put these jokers “in charge” of gigantic organizations. Yet, we might end up with a man at the top of the heap in the widget company who doesn’t know how the widgets are made. Remember, we saw Muñoz, with no airline experience, brought in to head U.A. Another big fail is how they'll put accountants at the top. “Bean counters.” Well, they know how to cut costs, but at the expense of research and development. Many companies were ruined in this way, GM and Chrysler being prime examples.

Pyramidal Organizational Structures

Make no mistake, if there is a fundamental problem that persists in business, despite how bad it is, there’s a reason. The structure may be cock-eyed, but it’s achieving a desired result, even if it may seem like catastrophe.

A pyramid system is desirable exactly for its weaknesses: It’s easy to run a coup. An hereditary idiot can be on top, someone who gets to “feel powerful.” One person with an agenda can mold the system to his will. And there are other seedy things.

It’s not a place you should want to work at.

There’s no motivation on behalf of those at the top to recognize your contribution.

The better you are, in fact, the bigger the threat you may pose to those above you.

It’s a system contrary to common sense. One thing the corporation has going for it is that it can be ego-neutral, but corporations don’t exploit that fact.

A corporation needs to recognize and utilize any and all talent.

It can’t do so under this parasitic-styled structuring.

Consider something else: The purpose of a corporation is to make money for the shareholders.

How many times have you heard that piece of absolute tripe and nonsense?

If that were so important, you wouldn’t allow one single person to be on top and in position to bugger up the works at will. What a crock!

Industrial Sabotage

This story is really bothersome, but it is a perfect illustration of the farce of the existing system, especially if you’re a fan of plucky old-time (and former industrial giant) Chrysler Corporation.

It was the perfect American bromance. Newberg and Colbert... that only ended in pain, recriminations, vituperation, lies and heartbreak.

“Tex” Colbert was chairman of Chrysler Corporation and close with Bill Newberg (whom he had promoted to the presidency). The wives were best friends. It seems that Newberg, in the early 1960s, with one misguided decision, nearly brought the house down around everyone’s ears. No employee seemed to have the guts to stand up to the freak.

And it wasnt just Newberg, but his boss was also shady, in a weird and mysterious tale.

Aaron Severson’s detailed site, Ate up with Motor, provides the story.

At Chrysler’s annual shareholders meetings in 1959 and 1960, stockholder Solomon Dann accused Tex Colbert of mismanagement and charged that Chrysler executives were handing out contracts to suppliers in which those executives had a personal stake... to line their own pockets. Those accusations prompted influential shareholder George Love... to recommend in April 1960 that the Chrysler board commission an independent audit.

The audit... discovered evidence that Bill Newberg and his wife Dorothy had interests in three different automotive suppliers whose Chrysler contracts had earned the Newbergs some $455,000. They were not the only Chrysler executives to profit in this way; Colbert later admitted that his wife Daisy had owned stock in a different Chrysler supplier, the Dura Corporation.

Sol Dann and his supporters... filed numerous lawsuits and later that year mounted an unsuccessful attempt to force Chrysler into receivership — the board realized something had to be done. On June 30, Newberg was fired after only 64 days as Chrysler’s president. At the same time, Colbert ordered other Chrysler executives to immediately divest themselves of any financial interests in Chrysler suppliers.

Newberg... alleged that Colbert had asked him to take the fall for the conflict-of-interest scandal, promising that Newberg would be taken care of financially... In January 1961, Newberg filed a $5.3 million unfair termination lawsuit against Chrysler, naming Colbert as a correspondent. Later that year... Newberg allegedly punched Colbert in the face.

Colbert denied Newberg’s allegations, but questions about Colbert’s own supplier interests remained... syndicated newspaper columnist Drew Pearson revealed that Colbert’s office safe contained $200,000 in bearer bonds whose source Colbert declined to reveal. Although Colbert continued to deny any wrongdoing, he stepped down as president in July 1961, accepting a new post as president of Chrysler Canada. He retired four years later at the age of 60. Newberg’s lawsuit was not resolved until 1970, when he and Chrysler agreed to settle out of court.

Anyway, aside from his other bad behavior, Newberg came into a meeting one day and demanded that the corporation reduce the sizes of all its already-prepared full-sized cars for the upcoming model year. Seems he’d eavesdropped on the General Motors executives at a cocktail party, and garnered the “intelligence scoop” that GM was about to downsize all its models, and Newberg wanted to not be “caught with his pants down.”

Well, the GM execs were talking about downsizing, alright, as it turned out, but this was regarding the introduction of an intermediate line of cars. There was no intent to shrink the normal, full-sized models, some of which actually grew somewhat.

And so the Chrysler fiasco entailed enormous effort, struggle, and financial expenditure. However, when the so-called “plucked chickens” – the crudely down-sized models – for 1962 were shown, many dealers canceled their franchises on the spot!

Chrysler’s market share plummeted and it was yet another near-death experience for the corporation.

There was no other investigation to confirm what Newberg overheard, no research into what Ford might be doing...

But nowhere do you read any speculation that Newberg did this deliberately, as corporate sabotage. Certainly the possibility has to be considered.

How bizarre that Newberg was allowed to continue on his merry way, whereas some poor chump in the warehouse who accidentally drops a crate will get canned immediately. Any organizational system that permits any Newbergs or Coleberts in the first place, is a flawed system.

Why Do We Have “Managers,” Again?

The principal reason to maintain this deranged setup is to allow for the assertion of a tight, psychotic control, where only a very small number of people are needed to rule a much larger group.

Whether for right or wrong, good or bad.

What a farce!

But who are the managers that get shoved into place as the petty rulers?

Consider the thoughts of a high-ranking official in a business, on a quest to hire a new manager. He will want someone who can fire people without conscience. Someone who will not suffer pangs of remorse, or be troubled by guilt. Someone who will follow orders without question.

So, given that, it is simple to discern what traits are being selected for: “Bosses” are those selected for psychopathy.

Also, importantly: Psychos know their own. So they can gather a bunch more psychos around them, and create a whole psycho organization, at least at the managerial ranks.

Which is why these “managers” aren’t too ashamed and embarrassed to even come in to work. Sometimes it seems “the worse the better” is the motto for management.

And they all seem to survive, and even when they’re ousted for their screw-ups, they land on their feet and secure a similar position at a different company.

Even, or especially when, the workers are thrown to the dogs.

The managerial suite is a mutual support unit of incompetents, at least when they aren’t stabbing each other in the back.

Also, a recurring problem is where a manager is not working for the betterment of the company, but trying to preserve his arena, his little part in the scheme of things, regardless of waste, counter-productivity or dysfunctionality.

The Workplace

Cubicle Farms

One of the brilliant ideas brought to us by “Consultants,” “Managers” and “Presidents.”

That’s the best they could come up with – the new way to promote efficiency.

The fact that we go to work at all shows we’re probably all idiots.

They partition off a large area with half-height dividers and crowd people into the space, and expect them to work.

Cubicles are noisy and stressful. There is a lack of privacy. You have to tolerate idiots running around, spouting off nonsense talk.

If those things are so good, so effective at promoting productive work and workplace well-being, why aren’t the members of management given a cubicle? Instead, every manager I’ve seen “managing” these cubicle farms has a nice office.

Now consider this: Stress does nothing to help people do their jobs. So why are job environments set up in a way to create stress? Anyone can “pop in” to your “office” at any moment. Everyone milling around, chattering or slurping a coffee, or just walking by, will affect you, whether it seems to bother you or not.

It’s demeaning.

Note carefully: Studies have been run on these “cubicle farms,” and it has been found that employees are less productive there.

And that was the reason for cubicles: To put the minions in their place. Perhaps, in some instances, the administration was sold a line about how this saves office space and enhances “work flow” or some other dumb-azz buzz-term. Of course it saves office space. At the expense of the people actually doing the work.

These “cubicle farms” are not so discreet clue to your station in life!

(Years past, at a particular summer intern job, I did have an office, shared with four, but still an office with a door. The manager even made a pointed, comment that that was the way things were done there. So they do know.)

Then the small business monkeys hop on the bandwagon – they gonna get a piece of that smart stuff, too. Not that they need to “save space,” with only a few employees.

Oh... cube farms are not just to send that, “You’re a pissant,” message to the “little people,” no, but equally to boost the “important people” higher up the totem pole to assuage their ego.

Hard Hats

Working in construction, they would give out hard hats. This became sort of a joke among the workers: Pissants had the blue one, and the crew boss would have a yellow one. The Man would have a white one. I never saw the Big Man, perhaps he had a two-tone with tail fins and a propeller on top.

Since there are no hard hats in the office setting, well... other tactics must be employed to “put ’em in their place,” and “show who’s the boss around here.”

The Absurdity of “Management Assessments”

There are no fixes to this type of system. But that never stops them from pretending. Absurd surveys to “assess managers,” where employees “grade” the managers have to be the worst, most ineffective exercises devised.

No one can be blunt and state, “Hey, we don’t need most of these managers!” Well, someone might, but the advice won’t be acted on.

Of course surveys won’t work because the employees fear for their jobs, or the management will cover up criticism.

They are a good way to embarrass everyone in the organization though, and reinforce learned helplessness.

And who is to say they don’t want the poorly rated managers? Those are the “tough ones,” who, “carry the flag” for the company and “get the riff-raff (employees) in line.”

Besides, giving advice for how the management might be improved is hard, given that staff aren’t generally privy to what’s going on at that level. Regardless, even good advice likely would never be followed, due to the egos involved.

We Can’t Talk About Things

We cannot talk about real things, so we can’t have effective workplaces.

If we could, every manager would need to call a meeting and describe every idiotic thing that happens at workplaces, and how embarrassing such incidents are for everyone.

Like the drama queens and self-righteous, self-important frenzies that should have been slapped down by a mature boss. One time, a young woman was outraged... so the whole office had to be outraged too, that someone had left a paper with a cartoon like, “Half-angel, half-bitch,” or something equally silly, on her desk, prompting an absurd disruption throughout the entire business, where we were all told firmly that this was not okay, and the like.

Work can be bad, or good. We need not “policies” or “rules,” but “common sense” to achieve that.

• People want to feel productive. A torture employed during WWII was to make people dig a hole one day, then fill the same hole in the next day. There is something in man that makes him want to feel useful, and he cannot tolerate this. In fact, he would prefer to work productively, even if it had to be for an enemy. Likewise, you couldn’t pay someone to do this (though, interestingly, some people will tell you that as long as they’re well paid, they would do it, but they’re deluding themselves).
• People tend to gossip, and, often, to try to sabotage others. That sabotage takes subtle forms, “Oh, that was Murray’s job. Did he skip it?” As such, we have to strategize against that in the workplace. (It’s a hell of a task. Management, to large degree, loves snitches and most got to the top using workplace politics.)
• Business is dependent on its people. And though we can’t go around praising everyone willy-nilly, 24/7, people still need to feel appreciated.
• People have different qualities. This is one signal of how the conventional interview process is foolhardy. We should want people with opposing views to our own, not purge and filter them, so we can attack work problems from different perspectives.
• Recognize that everyone’s job will be a test of character in his or her reactions to difficult problems/issues.
• Looking at “the profit motive” is important; however, one goal at work should be to maximize, not just profits, but personal growth of everyone. Not in a touchy-feely, “new-age” sense, but so that their work skills are constantly advancing, advancing the business in turn.

Looking back at the old Chrysler again, one might note how Iaccoca came in and fired something like 90% of the upper management, and rescued the company. There’s no shortage of examples like that, leading us to the plain conclusion that the organizational system of business is flawed and has to be restructured from initial principles.

Modern Business

Big businesses, “too big to fail,” cash in on government handouts all the time, or they’re “bailed out,” or they get huge contracts that make them invulnerable, like when Microsoft got contracts to provide governments everywhere with billions of dollars in software. Hence, big business can demean its employees without consequence.

And, a current sweeps around the business world, dispersing all the latest tips and “guidelines” on how the minions are supposed to do things. In hopes of slurping up some of that sweet, sweet cash from loans or other cash disbursements, like grants. There are large contracts they may tap into if they, too “play the game.” But in doing so, businesses embrace controlled destruction (as we see with the EDI and LGBTQ+ stuff and the offshoring of production that companies are promoting against their own interests). It turns out that BlackRock and its ilk (like Vanguard et al) are able to control most of the businesses in America in this way, since it has a sweet scheme where it can direct or block financing to any company it chooses, working with central banks to funnel money by choosing which companies get loans, and at what terms.

The existing organizational and management system “works” only because it is deliberately financed and fostered. It never evolved naturally, but was planned.

Henry Ford set his company up to pay his workers considerably above industry standard, with the expressly stated purpose that they’d then become customers for his product, cars. So altruism/partial altruism can have its pragmatic side as well. We certainly don’t see any of that today. It’s forbidden, and would probably be fatal for the business when the manipulating controllers/financiers heard about it.

Better Way

Of course there is a better way of doing things. It's refreshing in its simplicity, and something we'll explore in subsequent articles.

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