Wednesday, December 09, 2009

Reading :: Managing in a Time of Great Change

Managing in a Time of Great Change
By Peter F. Drucker


This book, written in 1993, is largely drawn from previously published pieces in The Atlantic Monthly, the Harvard Business Review, and similar publications. As Drucker explains in the Acknowledgements, “every piece in this volume was written with this book in mind,” but he “prepublished” them in other publications as a “market test” (p.353). Wily, but it means that the chapters present a measure of repetition among themselves and with other publications such as Drucker’s Post-Capitalist Society. So, yes, I skimmed, and consequently this review is not terribly substantive. But I’ll attempt to surface some points that are worth exploring further.

One is the notion of an organization’s theory. Drucker argues in the first chapter, “The Theory of the Business,” that each organization has a theory – a set of assumptions about markets, customers, competitors, values, behavior, dynamics, strengths, and weaknesses. “These assumptions are about what a company gets paid for” (p.22). Unfortunately, sometimes these assumptions become invalid, yet organizations don’t revise their theories, and consequently these organizations stumble. Warning signs include: an organization that achieves its original objectives (p.34); an organization that doubles or triples in size (p.35); and unexpected success or failure (p.35). Each of these conditions should prompt an organization to find a new theory.

In Chapter 6, “Managing in the Network Society,” Drucker goes on to assess changes in the organization. This ground is familiar to those who have read Post-Capitalist Society, but Drucker offers some additional discussion here.

In Chapter 20, “The New Superpower: The Overseas Chinese,” Drucker provides a fascinating glimpse into secretive and tightly controlled networks of organizations run by direct relatives of an ethnic Chinese living in the Philippines. “What holds together the multinationals of the overseas Chinese is neither ownership nor legal contract. It is mutual trust and the mutual obligations inherent in clan membership” (p.206). This claim, of course, reminds me of Ronfeldt’s description of TIMN: although these organizations are constituted as networks, their trust is tribal. Yet the organizational forms are in some ways contradictory, and dealing with those contradictions will soon mean developing the networks so that they can scale: sharing information and allowing outsiders in. Honestly, this was the most interesting part of the book for me.

In Chapter 21, “A Century of Social Transformation,” Drucker describes the fall of the blue-collar worker and the rise of the knowledge worker. And in contrasting the two, Drucker made me think about a transition that has always interested me: the birth of the participatory design approach in the UTOPIA project and related projects in the early 1980s. In that project, unionized craft workers (typesetters) were faced with the prospect of losing the benefit of their deep craft knowledge because their organization was planning to move to a digital system. Computer scientists worked to design a digital system that would leverage that craft knowledge. Yet the UTOPIA project never delivered a concrete product, and as I’ve described elsewhere, participatory design techniques were translated considerably as they moved to other contexts. Drucker maintains that manual work is experience-based while knowledge work is learning-based. “Displaced industrial workers thus simply cannot move into knowledge work or services work the way displaced farmers and displaced domestic workers moved into industrial work” (p.227). This summary judgment may not explain what happened with participatory design, but it provides an interesting perspective from which to examine the transition.

Should you read this book? I’d recommend Post-Capitalist Society over it, but if you haven’t read that book and you want a quick overview of his contemporaneous work, this book might be worthwhile.

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