Do away with traditional lines of authority. Trust your empoloyees to manage their own work units. Encourage teamwork, creativity, and individual responsibility. That, in bare outline, is the "new management" practiced by such companies as W.L. Gore & Associates (INC., August 1982) and Quad/Graphics Inc. (INC., October 1983 and December 1986). But where did the philosophy come from? For one company -- Kollmorgen Corp., an electronics manufacturer -- at least part of the source was an influential book first published in 1960.
(Robert Swiggett, who wrote what follows, is current chairman of Kollmorgen.)
The Human Side of Enterprise, by Douglas McGregor, stands out like a lighthouse shining over the sea of literature on management. When I first read it, about 20 years ago, I found it illuminating in a way never duplicated by the many books I have waded through since. Next to McGregor, all those books seem as superficial as a dinner-party conversation compared to a well-thought-out doctoral thesis.
At the time, our company was grappling with the transition from entrepreneurial start-up to fast-growing business, with more than 500 employees and multiple products. Our small management team had begun to attack organizational structure and motivation with some of the same analytical energy we had devoted to product and process engineering. McGregor's book seemed to be written just for us. His concepts of what made people and groups creative, happy, and productive seemed to fit precisely with our own experiences, both good and bad, in the military and in business. They also matched our optimistic view of human nature.
Almost everyone wants to do good work, to achieve self-esteem and the esteem of others by making a commitment and fulfilling it.Most people seek responsibility. Most are creative, though they probably realize only a fraction of their potential. McGregor's statement of these ideas -- he calls them Theory Y, as opposed to the Theory X of traditional management -- clarified our thinking as we thrashed out the issues of a growing business. What is the proper role of leaders? What kind of pay and profit-sharing systems did we want? How useful are management-by-objectives, job descriptions, performance appraisals, and so forth?
McGregor saved us from the countless mistakes we might have made by following one fad or another. His book was read widely in our company and referred to often.