Why Engineers Trained 20th Century Managers and Social Scientists Develop 21st Century Leaders (Part 1)

The 20th century saw the explosion of manufacturing, mass production and the commoditisation of many products and services. This was based on the advent of strong engineering capability that enabled mass production, driven by an ever increasing focus on economies of scale. This mass production drove down price and made a plethora of goods and services accessible to many more people. Commoditisation in the 20th century culminated in easy access to information and intellectual property (IP). IP, the final bastion of competitive advantage began to fall away as a more open and technologically enabled world could access and share IP with increasing ease. This has been a key disruptor to many IP based industries such as music, where traditional business models have been fundamentally challenged. Organisations can no longer depend on reasonable lead times on their “unique” product and/or service as the “open” knowledge economy has demonstrated things can be copied quicker and quicker. 3D printing highlights how this fundamental shift is manifesting and will disintermediate traditional manufacturing and its related value.

The 20th century organisation was engineered on the ability to scale effectively by designing structures that were built for purpose and where success was measured by a key indicator “efficiency”. The great engineering challenge for 20th century managers was how to deliver “more with less”. Hierarchical structures, with clearly delineated tasks and focus, aligned along a well-integrated value chain, required managers to develop, maintain and manage these structures and the individuals neatly boxed within them. As the 20th century wore on though, the pace at which products and services needed to change in order to remain competitive, began to put pressure on managers to be constantly re-engineering their structure and processes.

Psychology Enters the Organisation

It was in this space of large scale and fundamental re-engineering and the resultant change that was required that psychologists (social scientists) began to find a place of significance within organisations. This was paralleled by a shift to seeing HR as a strategic function, rather than an operational function. This is because people and their unique IP (knowledge workers as we refer to them) and their ability to leverage this to innovate continuously became the strategic advantage for many new and even established industries, no longer simply products and services. Behavioural scientists began their contribution primarily within the discipline of change management, essential in an environment linked to a constant need to innovate. This discipline struggled to be recognised by the majority of traditional managers, as it spoke to what was termed the “soft” skills component of management. Both the term change management and soft skills are misnomers and have impacted on the effectiveness of organisations to transform or effectively implement continuous change.

Firstly, one cannot manage change, change needs to be led. By trying to match the 20th century paradigm of management, the change leadership function in organisations attempted to emulate management practices and disciplines by focusing on collecting data, designing and orchestrating communication processes and overlaying the function across existing processes and structures. Most importantly change management was handed over to managers in the organisation to lead the change, and did not remain with the leaders of the organisation who are fundamentally responsible for driving change.

Secondly, by referring to the skills required to lead change as soft skills, it limited the attention paid and the importance given, to what any leader who has led a significant organisational change, will tell you is the hardest thing they have ever done.

In the early stages of the 21st century only the most progressive organisations, leaders and managers have begun to embrace the people function as strategic, and to recognise that they require leaders, not managers, to implement and motivate people through constant change. The need for consistent change management is not only based on the need for organisations to continuously evolve due to an increasingly competitive environment, but also to manage higher levels of uncertainty in a globalised and volatile world. Never before have we had an attack on a single country that lasted just four hours (9/11), shake the global economy almost instantaneously. We live in a world where “uncertainty is the new normal”. Traditional Managers are defined by their ability to create certainty through their structure and processes. Organisational leaders are defined by their ability to create the right shared purpose, develop ownership at all levels and effect change in people, while navigating a dynamic, complex global ecosystem.

In Part 2 we will unpack how leaders are making these shifts in order to successfully steer their organisations and the people within them to success.

Author: John Brodie is a Registered Clinical Psychologist, Executive Coach and Organisational Development Consultant.