Since the 1890s, there have arguably been only a few major management breakthroughs, with several minor ones. What will be the next big tsunami in management that can differentiate leading organizations from also-rans lagging behind them? I suggest one possibility at the conclusion of this article.

The History of Management Breakthroughs

Where do you draw the line between the major and minor management breakthroughs of innovative methodologies that can provide an organization with a competitive edge? I’m not sure, so my list likely describes a blend:

• Frederick Winslow Taylor’s Scientific Management: Taylor, the luminary of industrial engineers, pioneered methods in the 1890s to systematically organize work. His techniques helped make Henry Ford wealthy when Ford’s automobile company applied these methods to divide labor into specialized skill sets in a sequential production line and to set stopwatch-measured time standards as target goals to monitor employee production rates. Production at rates faster than the standard was good, while slower was bad. During the same period, Alexander Hamilton Church, an English accountant, designed a method of measuring cost accounting variances to measure the favorable and unfavorable cost impact of faster or slower production speeds compared to the expected standard cost. more

Achieving the full vision of the enterprise performance management framework involves more than selecting one of its many methodologies and then purchasing software to install and implement the solution. It requires individuals with talent and skills. Here is a list of famous people who have inspired me and exemplify the traits valuable in achieving that full vision:

• Socrates: An effective way to help people learn is by asking them questions that lead to meaning. Socrates taught Plato and other Greek philosophers by making them think about answers to his questions rather than just lecturing. For example, asking “Does our organization measure the correct performance indicators that reveal progress toward achieving our strategic objectives?” is more stimulating than simply providing a list of commonly accepted industry metrics.

• Thomas Jefferson: Americans typically have a favorite “founding father” of their nation. Mine is Jefferson because he believed in a fair society. Performance management involves equitable treatment of allocating resources to align with the organization’s strategy to optimize results. For example, activity-based costing traces costs accurately, compared to traditional broadly averaged cost allocations that give false impressions because some product’s costs subsidize others. more

Have you ever worked for an organization where you doubted the leadership capability of your CEO, managing director, division president, or agency head? Have you ever been disturbed that your organization is not living up to its full potential in terms of its enterprise-wide performance management? Imagine that I am media journalist. How would you like to work for an organization whose leader answered my interview questions as follows?

Cokins: What is your position regarding how your organization views quality and waste?

The CEO: The quality community often provides lists about the five or so quality problems, such as nonconformance to product design specifications or insufficient focus on customer service. My observation is that these lists always omit a much more critical deficiency: the inability to enable employees to achieve their full potential to contribute toward the organization’s strategic goals. This is a huge waste – and opportunity. My position is that our managers’ main function is to unleash the power and intellect of our employees.

Cokins: How have you created a work environment that makes this possible?

The CEO: I set the tone at the top as a role model by placing a high priority on three character traits: trust, a high tolerance for dissent, and innovation. Their combination is potent in a positive way. Without trust, employees do not feel that they are adequately involved in decision-making. Without allowing a time period for dissent, employees will not feel that there was opportunity for their opinions to be considered. Without innovation, competitors will catch us and leave us chasing them. more

Have you heard the joke about economists? Some are being called “iconomists” because they did not foresee the 2009 global credit crisis.

As volatility increases – in items such as oil prices, foreign currency exchange rates, and commodity prices – the task of macro-economic analysis becomes more challenging. The world is becoming more complicated, in part due to the speed at which information flows. The same challenges apply to micro-economics, and that directly impacts the decisions individual commercial companies and public sector government agencies must deal with.

What is an executive to do? There is more uncertainty and risk. My belief is that there is not much of an alternative than to become much more analytical. This means digging deeper into the mountains of data you already have as well as becoming more proficient at predicting the future. Unfortunately, most companies are far from where they want and need to be when it comes to implementing analytics. They are still relying on gut feeling, rather than hard data, when making decisions. They are short on the skilled talent and the technologies necessary to perform analytics. What is needed by executive leaders is to create a culture for metrics in their organizations. more

Why study and learn?

The more you study, the more you learn. The more you learn, the more you forget. The more you forget, the less you learn. So why study? The less you study, the less you learn. The less you learn, the less you forget. The less you forget, the more you learn. So why study?

I recall laughing when I first heard this contradictory prose from my university days 40 years ago, but I had no choice but to ignore it and do the opposite. I was an industrial engineer then at Cornell University competing with top-notch high school honors students. There was no option but to study hard.

Why is this relevant to our job and career today? Like many of you, I went to college, took classes, and received grades. But when I left my scholastic education, which is formal and supervised, I then began my experiential education working in organizations. This is no different than you, and we all now know that the experiential education is much more behavioral and emotional than in the academic world where you are doing your homework and raising your hand in class to show off to a professor that you know the correct answer.

The experiential education is unstructured and somewhat random. It comes at you. There is no course syllabus. You just start accumulating knowledge and wisdom through all the interactions emanating from your assigned tasks or projects plus the colleagues, customers, and partners you work with. more