Re:McKinsey, technocratic management, and structural inequality
by mjparrott on Tuesday February 04, 2020 @12:25PM
(#22238266)
This is a great fact based argument. However, it is confusing "good quality management" with "more managers". "Best management practices" does not necessarily mean "more managers". I would actually argue that the more incompetent managers you have, the more of them you need to get business done. Finding incompetent managers and highlighting them is something consulting firms can help to do.
Well, the academic research paints a different picture. Here's what we know. Even within the same industries, in the same markets, there's a substantial dispersion in management practices and adherence to best practices between the best and worst firms.[1]
The firms with the best management practices have substantially higher productivity and profits than their poorly managed counterparts.[2] We also know from randomized control trials, that interventions designed to improve management practices at the organizational level have long-lasting effects on firm performance.[3]
Moreover this isn't just a case of "good management" meaning abusing employees. There's a strong positive correlation, at the firm level, between management best practices and employee satisfaction.[1]
That's a pretty strong indicator that management, at least done right, isn't just BS. That it makes a significant impact on tangible economic output. Incompetent management really is just pure inefficiency with no upside for anyone.
[1] https://www.aeaweb.org/articles?id=10.1257/jep.24.1.203 [2] https://academic.oup.com/qje/article/122/4/1351/1850493 [3] https://academic.oup.com/qje/article/128/1/1/1838606