Eliminating ‘middle-management’

Frederik Taylor, the ‘father of scientific management’, was known to use a stopwatch to measure how many sacks of pig iron a labourer could load into a railway carriage per hour. In his words,

‘… the science of handling pig iron is so great and amounts to so much that it is impossible for the man who is best suited to this type of work to understand the principles of this science, or even to work in accordance with these principles, without the aid of a man better educated than he is.’

In direct accordance to these ideals, modern management theory has placed an extraordinary amount of importance on hierarchy and measurement. Workers clock-in and clock-out, and hourly output of every machine is registered. A worker was penalized for showing up a minute late and for output below the hourly target. Management does not trust labour to even be capable of ‘the science of handling pig iron.’

FAVI was a traditional brass foundry when Jean-Francois Zobrist took over as the CEO in 1983. FAVI worked like most manufacturing companies still do, with a layer of middle-management to exercise control over employees. Shortly after taking over, Zobrist did away with this layer of management and their timepieces.

His managers were aghast! ‘Productivity will collapse’, they said. Yet, Zobrist believed that employees and workers were reasonable people who can be trusted to do the right thing when given the freedom to do so. With that premise, very few rules and control mechanisms are needed.

The first week after he implemented the changes, Zobrist looked at the productivity numbers everyday. It turned out that hourly productivity actually increased. Also, operators earlier left their stations the minute their shift ended. In the absence of time controls, they stayed a few minutes longer to finish their work. When the operators were asked about it, they mentioned how under the old system, they didn’t work at their natural rhythm but had intentionally slowed down to gave themselves some slack in case management increased their targets. Further, their self-image had changed. Earlier, they used to work for the paycheck. Now they felt responsible for their work and felt pride in doing a good job.

Despite stiff competition from China and elsewhere, FAVI remains one of the most profitable and well run European manufacturing organizations. Zobrist documented its story in a book whose subtitle captures the essence of the company’s values – L’enterprise qui criot que l’Homme est bon (The organization that believe’s that mankind is good).

The people around us are often what we expect them to be. If we expect them to require micromanagement and slack off in the absence of a clock, they will conform to that image. Instead, what if we expect them to reasonable, smart and responsible individuals and treat them in that manner?

Recommended reading: The Management Myth, Reinventing Organizations

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