More indians, fewer chiefs

Like most nations with a taste for the stick and an indifference towards the carrot, the UK has an amazing number of managers.

The word ‘manager’, of course, can mean many different things.

Yet, according to the most recent occupational classification, the group called ‘managers and senior officials’ – defined by the Office of National Statistics as ‘occupations whose main tasks consist of the direction and co-ordination of the functioning of organisations’ – accounts for no less than 15 per cent of the labour force.

More jobs fall into this group than any other (see chart below).

In 1971, the census found 8.2 per cent of workers were ‘managers and administrators’, using an older definition.

Control is a form of reward – a talisman of personal competence – and the masters of the modern workplace increasingly love the thought of giving one person power over another.

The British, along with the Americans and the Canadians, can count themselves among the nations of the earth with the deepest fondness for bloated corporate bureaucracy.

At the other end of the spectrum, just 3 per cent of Sweden’s labour force is involved in managing and supervising other workers. Naturally, one fears anarchy in such places.

In the same way that the right choice of trousers can camouflage a distended belly, the careful deployment of rhetoric can distract from a dubious chiefs-to-indians ratio. In fact, so successful has been the message that employers have spent the last few decades removing managerial layers in the pursuit of the flat, super-flexible organisation, that no amount of evidence is likely to persuade them otherwise.

But make no mistake: the idea that there is a trend towards de-layering is mischievous myth-making on a grand scale.
In the US, an iconoclastic book called Fat and Mean: The Corporate Squeeze of Working Americans and the Myth of the Managerial Downsizing (1996), by the late David Gordon, first shed light on the 17 million people supervising their allegedly empowered, involved and autonomous subordinates.

But here, it is largely thanks to the Economic and Social Research Council (ESRC) that de-layering has been exposed for the distortion it is.

“The ubiquitous references in the literature on management to the emergence of flatter organisations and the disintegration of established bureaucracies…appear to have been wholly misplaced,” writes professor Peter Nolan in a new paper.1 ‘Re-layering’ might be more accurate.

Perhaps one of the reasons the flatness vogue caught on as it did was that commentators assumed that the growth of worker autonomy meant a decline in the need for managers.

But this is the critical point about the vast managerial labour force: greater freedom for workers has been accompanied by increased control.

According to the ESRC, there has been a real and substantial move towards greater freedom on the job for employees.

A clear majority of workers control their own task allocation, the pace of work, and their own work style. Yet a majority also say someone formally monitors their performance. In place of one person specifying the work of many as in the old version of command-and-control, new command-and-control has one person doing the job as they see fit and two more checking it has been done properly.

Of course, in each organisation, from whatever sector, there will be a multitude of reasons why management positions have grown.

It could be that adding to the hierarchy is a more potent form of reward than pay and financial incentives: status and challenge often persuade able staff to stay put.

Alternatively, it could be that the widespread use of targets and performance pay has spawned a new army of assessors.
A third possibility is that organisations are more inclined than before to allow wider access to management grades.

After all, who would not want to be a manager, when superiority over another usually means entry to a voluptuous world of bonuses, incentives, pensions, profit-sharing, health schemes, cars and travel subsidies? The manager/non-manager divide remains one of the great fault-lines of the UK workplace.

Yet sooner or later, the tumid managerial ranks are going to have to face some difficult questions. Why does competitiveness demand the lowest wage costs while permitting the highest management costs? How many managerial positions really ‘add value’? If flat organisations are efficient and responsive, why appoint so many managers?

It is hard to imagine such questions have escaped the attention of politicians, yet managers rarely seem to figure in their cogitations on productivity.

In the chancellor’s pre-Budget report in early December, Gordon Brown repeated his prescription for the future of enterprise: science, innovation and skills. The UK needs to veer off the ‘low road’ of competition through low wages and low productivity, he said, and on to the ‘high road’ of high skills, high investment and high added value.

Few would quarrel with his aim. But isn’t the creation of new managers as much a symptom of the low road as poor literacy levels? Doesn’t the shift to a post-industrial economy demand a war on the fetish of occupational hierarchy?

When asked what he thought of British democracy, Mahatma Gandhi once said that he thought it would be a very good idea. The same might be said of de-layering.

1. Back to the Future of Work by Peter Nolan, University of Leeds, 2004, www.leeds.ac.uk/esrcfutureofwork/downloads/events/colloquium_2004/nolan_paper_0904.pdf



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