9789144093284 by Smakprov Media AB

Alexander Styhre, Ph.D., is Chair of Organization Theory and Management, Department of Business Administration, School of Business, Economics and Law, University of Gothenburg. Other contributors are: Roland Almqvist, Mats Alvesson, Ester Barinaga, Johan Berglund, Ola Bergström, Martin Blom, Ulla Eriksson-Zetterquist, Tobias Fredberg, Jaan Grünberg, Anna Jonsson, Thomas Kalling, Dan Kärreman, Marcus Lindahl, Maureen McKelvey, Annika Rickne, Stefan Sveningsson, Nadja Sörgärde, Fredrik Tell, Stefan Tengblad and Niklas Wällstedt.

Management An advanced introduction

The book is intended for undergraduate and graduate students, doctoral students, management researchers, and all those interested in the practice of management and management as a scholarly research field. Within each research area, the volume provides a short historical overview, presents ongoing theoretical debates, and provides thoughts regarding the future of the field of research. Art.nr 37713

An advanced introduction

This book brings together scholars from the different domains of expertise in management studies to provide a comprehensive yet accessible overview of these research areas. In addition, these scholars are invited to address what topics and practical concerns these research areas might engage with in the near future. To enable a diverse yet authoritative overview each of the chapters is co-authored by two widely recognized scholars, in many cases representing different universities.

Management

| Management

As society as a whole is becoming increasingly “managed” and a “management industry” reports substantial turnover derived from its selling of a great variety of management books and training programs, one can persuasively make the point that we are living in an era dominated by managerial practices and managerial thinking. Today, there are many professional groups that make their bread and butter from practicing, developing, teaching, lecturing and researching management. As a consequence, there is a need to revisit questions such as “What is management?”, “What social good can it accomplish?” and “What could be the future of management?”.

Lars Strannegård Alexander Styhre (eds.)

Lars Strannegård, Ph.D., is Bo Rydin and SCA Chair in Leadership, Department of Management and Organization at the Stockholm School of Economics.

Editors

Lars Strannegård Alexander Styhre

www.studentlitteratur.se

978-91-44-09328-4_01_CoverHB_4utan.indd 1

2013-04-08 09.29

Copying prohibited

All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage and retrieval system, without permission in writing from the publisher. The papers and inks used in this product are eco-friendly.

Art. No 37713 ISBN 978-91-44-09328-4 Edition 1:1 ÂŠâ&#x20AC;&#x2030;The authors and Studentlitteratur 2013 www.studentlitteratur.se Studentlitteratur AB, Lund Cover design: Francisco Ortega Printed by Mediapool Print Syd AB, Estonia 2013

978-91-44-09328_01_book.indd 2

2013-04-03 18:19

Content

Author presentations 9 Preface 15 1. The Practice and the Discipline: An Introduction to “Management” 17 Alexander Styhre & Lars Strannegård

The roots of a term 17 Management: Organizing and modernity 20 Management as a scholarly field of research 23 Rationale for the book and its outline 28 References 33

2. Innovation Management 37 Annika Rickne & Maureen McKelvey

Why innovation has to be managed 37 The history of innovation management 39 Topics in innovation management 41 Types of innovation 42 Sources of innovation 43 Dynamics of innovation 45 Inside and Outside Firms: Open or closed innovation 47 Looking ahead 49 References 50

3. Organizational change management 57 Stefan Sveningsson & Nadja Sörgärde

Introduction 57 Episodic views of organizational change management 59 From Human Relations to Organizational Development 59 The Open Systems perspective 61 Culture and politics 62 The consultancy path 63 Major characteristics of the episodic view of change and some critique 65

978-91-44-09328_01_book.indd 3

2013-04-03 18:19

Content

A performative and processual approach to change 66 A focus on interpretation and sensemaking 67 A focus on discourses 68 Why change? Triggers and sense-making 69 Concluding remarks and reflections about the future 71 References 72

4. Knowledge Management 75 Anna Jonsson & Fredrik Tell

Growth and proliferation of the KM field: KM 1.0 and KM 2.0 78 An example of KM 1.0: How to capture and control knowledge 84 An example of KM 2.0: How to support and develop knowledge through practice 87 The popularity contest: KM vs. related fields of research 89 Knowledge management in practice – management of knowledge and knowing 90 Concluding remarks: KM – back to the future? 94 Suggestion for further reading 97 Acknowledgements 98 References 98

5. Technology & Management 107 Ulla Eriksson-Zetterquist & Marcus Lindahl

Paving the way for technology in management studies 107 From production on conveyor belts to computers 110 Managing in accordance with production 114 Practicing management and technology 117 Future venues 121 References 123

6. Human Resource Management 129 Johan Berglund & Ola Bergström

Introduction 129 Working conditions 131 Worker productivity 132 Motivation 133 Worker administration 136 Workplace democracy and development 138 HRM, and later on Strategic HRM 140

978-91-44-09328_01_book.indd 4

2013-04-03 18:19

Content

International HRM 144 The role and responsibility of HR 145 Summing up 147 Directions for the future 150 References 152

7. Leadership 157 Stefan Tengblad & Mats Alvesson

Introducing leadership 157 Defining leadership 158 Classic leadership research 160 Military leadership 160 Political leadership 161 Leadership as personal traits 162 Leadership as behavioral styles 162 Situational and contingency leadership 163 Contemporary leadership research 163 Transformational leadership 164 Relational approaches to leadership 166 Follower-centric views of leadership 168 Critical leadership studies 169 Managers and leaders: lessons from studies of managerial work on leadership 170 How managers perform leadership and other aspects of managerial work 172 Leadership research: societal impact and suggestions for further research 174 Leadership as everyday work-processes 175 Leadership as a collective phenomenon and an outcome of organizational cultures and other macro-forces 175 Mediocre, bad and toxic leadership 176 References 177

8. Corporate Governance 181 Martin Blom & Jaan Grünberg

Introduction 181 Financial perspectives on governance 184 From institutional economics to organizational institutionalism 186 Different governance systems in different parts of the world 189

978-91-44-09328_01_book.indd 5

2013-04-03 18:19

Content

Pluralistic perspectives: a European approach 191 Corporate governance research out of fashion? 193 Corporate governance in the future 195 Further reading 196 References 197

9. Managing public sector organizations: Strategic choices within changing paradigms 203 Roland Almqvist & Niklas Wällstedt

Introduction 203 The rise of NPM 205 Three strategic choices facing public sector management 208 Strategic choice 1: The location of organizational boundaries 209 Strategic choice 2: The structure of contractual relationships and the development of resource management 211 Strategic choice 3: The system of internal control and communication within the organization 218 Three public sector management paradigms, three strategic choices and their characteristics 222 Conclusions 225 References 226

10. Culture and Identity in Management Studies 231 Ester Barinaga & Dan Kärreman

The emergence of Culture in Organization Studies 231 Culture as a variable (functionalism) 234 Culture as a metaphor (interpretivism) 236 Culture as a narrative (constructionism) 238 The Foregrounding of Identity in Organizational Culture Studies 241 Identity as Essence (functionalism) 244 Identity as Multiplicity and Meaning (interpretivism) 246 Identity as Auto-Biography (constructionism) 248 Conclusion 249 References 251

11. Strategic Management 257 Tobias Fredberg & Thomas Kalling

Definition 257 Chronology of Important Contributions 258

978-91-44-09328_01_book.indd 6

2013-04-03 18:19

Content

Michael Porter and the Industrial Organization Perspective 261 Strategy as Practice 269 Strategy theory today: the State of Play 270 How the context of strategy is changing 270 The road ahead for strategy research 275 References 277

Index 283

978-91-44-09328_01_book.indd 7

2013-04-03 18:19

978-91-44-09328_01_book.indd 8

2013-04-03 18:19

Author presentations

Roland Almqvist is Associate Professor at School of Business, Stockholm University. His research has mainly been oriented towards management control in the public sector with a special focus on the outcomes of New Public Management in public sector organizations. Roland’s current research is focusing on the next phase in public sector management control and is exploring the question: “What will come after the New Public Management?”. His research has resulted in book publications and articles in journals such as Accounting, Auditing and Accountability Journal, Critical Perspectives on Accounting and Public Administration. Mats Alvesson works in the Dept. of Business Administration, the University of Lund, Sweden and at University of Queensland Business School, Australia. Research interests include critical theory, gender, power, management of professional service (knowledge-intensive) organizations, leadership, identity, organizational image, organizational culture and symbolism, qualitative methods and philosophy of science. Recent books include The Triumph of Emptiness (Oxford University Press, 2013), Qualitative Research and Theory Development (Sage, 2011, with Dan Kärreman), Constructing Research Questions. (Sage, 2013, W. J. Sandberg) Interpreting Interviews (Sage 2011), Metaphor we lead by. Understanding leadership in the real world. (Routledge 2011, ed. with Andre Spicer), Oxford Handbook of Critical Management Studies (Oxford University Press, edited with Todd Bridgman and Hugh Willmott).Understanding gender and organizations (Sage, 2009, 2nd ed. with Yvonne Billing), Reflexive methodology (Sage, 2009, 2nd ed., with Kaj Skoldberg). Ester Barinaga is Associate Professor at the Dept. of Management, Politics and Philosophy at the Copenhagen Business School. She obtained her Ph.D. from the Stockholm School of Economics in 2002. She has worked at the Department of Industrial Economics and Management at the Royal Institute of Technology in Stockholm and been a visiting scholar at SCANCOR, Stanford University as well as Queensland University, Australia. She is the author of Powerful dichotomies – Inclusion and exclu-

978-91-44-09328_01_book.indd 9

2013-04-03 18:19

Author presentations

sion in the information society (2010) and has published articles in, among others, Human Relations and Ethnicities. Her current work focuses on concepts, strategies and tools that may help us better design organizations and initiatives aiming at social change in general, and the dissolution of the immigrant condition in particular. [E-mail: eb.lpf@cbs.dk] Johan Berglund is an assistant professor at Stockholm School of Economics. He works within the field of Organization and Management. His research interests include: HRM, rhetoric, identity and power. He is currently interested in game cultures, the blurring of borders and leadership in online games, i.e. Massively Multi-Player Online Role-Playing Games (MMORPG). Ola Bergström is Professor in Management and Organisation at the Department of Business Administration at the School of Business, Economics and Law, University of Göteborg, Sweden. He obtained his doctorate at the University of Gothenburg in 1998. His research interests evolve around the interface between organizations and labor markets and in particular the field of restructuring in a European context. He has published articles and books on a wide range of topics such as recruitment, corporate social responsibility, and temporary agency work, restructuring and labor market policy. He is currently involved in research on how Swedish companies manage restructuring across national borders. Martin Blom is a Senior Lecturer in Strategic Management at Lund University School of Economics and Management. He received his doctorate in business administration at Lund University in 2007. Dr Blom is a researcher in the fields of strategy, leadership and corporate governance and has been involved in research projects and published within all these fields. He is also director for the BSc programme in Business and Economics at LUSEM. Ulla Eriksson-Zetterquist is Professor of Management Studies at the Gothenburg Research Institute, School of Business, Economics and Law, University of Gothenburg. She studies organizing processes, with special focus on gender, technology, intersectionality and risk. Tobias Fredberg is Associate Professor of Technology Management at Chalmers University of Technology and a fellow of the international © T h e a u t h o r s a n d S t u d e n t l i t t e r at u R

978-91-44-09328_01_book.indd 10

2013-04-03 18:19

Author presentations

research network TruePoint Center. He has researched organizations in an array of industries spanning from automotive, telecom, media and pharma to healthcare. His research focuses on how large companies and their leaders manage complexity, strategic change and innovation. On this subject, he and colleagues recently published the book Higher Ambition: How Great Leaders Create Economic and Social Value (HBR Press, 2011). Jaan Grünberg is a Lecturer at the Department of Business Studies, Uppsala University. His research deals with corporate governance, leadership and organizations. Currently he is working with issues that deal with the connections between corporate governance and management control in organizations, and the impact of mediatization on corporate governance practices. Anna Jonsson holds a Ph.D. in Business Administration at Lund University, School of Economics and Management. Her research interests include knowledge sharing, the internationalization process of the firm and qualitative research methods. She has recently conducted a oneyear ethnographic study on how knowledge is shared in the daily work within a law firm. The focus for her dissertation was on how knowledge is shared within IKEA when entering new markets. Anna is a post-doctoral researcher financed by the Jan Wallander scholarship at Lund University and by Ragnar Söderberg’s Foundation at Stockholm School of Economics. Contact: anna.jonsson@fek.lu.se Thomas Kalling is a Professor of Strategic Management and Head of the Institute of Economic Research at the School of Economics and Management at Lund University. Kalling’s research spans general strategic management issues, including organizational renewal and change, innovation, standardization and ICT. Professor Kalling is currently empirically studying the security, utility, packaging and telecom sectors. Dan Kärreman is Professor in Management and Organization Studies at Copenhagen Business School. He is also affiliated to the Lumos group at Lund University. His research interests include critical management studies, knowledge work, identity in organizations, leadership, organization control and research methodology. His most recent book is Qualitative Methodology and Theory Development: Mystery as Method (SAGE, 2011, with Mats Alvesson). © T h e a u t h o r s a n d S t u d e n t l i t t e r at u R

978-91-44-09328_01_book.indd 11

2013-04-03 18:19

Author presentations

Marcus Lindahl is chair of Industrial Engineering & Management Div. Industrial Engineering & Management at the Department Engineering Sciences, Uppsala University. He pursues research concerning organization & management in technology-intensive environments. His research is currently focused on the impact of identity, expert groups and communities of practice for technology adaption and appropriation. Maureen McKelvey is Professor of Industrial Management at the Institute of Innovation and Entrepreneurship, School of Business, Economics and Law, University of Gothenburg, Sweden. She has written and edited 11 books, and published more than 30 scientific articles and numerous book chapters. Her research crosses the boundaries between the Economics of Innovation and Innovation Management because firms are such crucial agents of change for innovations, but so are economic pressures and the broader context in the knowledge economy. Particularly interesting areas of research include the dynamics of industries like biotechnology and pharmaceuticals; the dynamics of sectoral systems of innovation; the search strategies of firms for new innovations; the interactions between industry and universities; universities’ new roles in the knowledge economy; and knowledge-intensive entrepreneurship. Maureen McKelvey has also served on major public policy initiatives for the OECD, VINNOVA, the Royal Swedish Academy of Engineering Sciences, and the European Union, including DG-Enterprise and DG-Research. Annika Rickne is Professor of Entrepreneurship and Innovation at the Institute for Innovation and Entrepreneurship at the School of Business, Economics and Law at the University of Gothenburg. She analyses issues of entrepreneurship and innovation at various levels – within technologybased organisations, at the sectoral level, and within innovation systems – and draws conclusions for strategy as well as for policy. Her interest is economic growth initiated by new scientific or technological knowledge, creating opportunities that reshape existing knowledge fields and industries or give rise to the evolution of new ones. Her research approach spans from case studies of researchers’ motives, through surveys of firm strategies and bibliometric studies, to interview-based analysis of policy development in the European arena.

978-91-44-09328_01_book.indd 12

2013-04-03 18:19

Author presentations

Alexander Styhre, Ph.D., is Chair of Organization Theory and Management, at the Department of Business Administration, School of Business, Economics and Law, University of Gothenburg. Alexander has published widely in organization theory and management studies journals and is the author, co-author and co-editor of more than twenty research monographs, textbooks and edited volumes, including the most recent Organizations and the Bioeconomy (Routledge, 2012). Alexander is the Editor-in-Chief of Scandinavian Journal of Management. Lars Strannegård is professor at the Stockholm School of Economics and holder of the Bo Rydin and SCA Chair in Leadership. His research interests focus on aspects of leadership, aesthetics, branding and organization. Lars has carried out research on organizing and management practice in multinational organizations. His work has been published in journals like Organization, Journal of Organization Change Management, European Journal of Marketing, Leadership, Annals of Tourism Research and Marketing Theory. Stefan Sveningsson is Associate Professor of Business Administration at the School of Economics and Management, Lund University, Sweden. He has been visiting researcher at Cardiff Business School, Cardiff University, Melbourne University and Auckland Business School, Auckland University. Research interests include strategic & organizational change, leadership, identity, and management of knowledge work. He is currently involved in an international study of leader and leadership development. He has published in several international journals including Human Relations, Leadership Quarterly, Organization Studies, International Studies of Management and Organization, Leadership and Scandinavian Journal of Management. Nadja Sörgärde is Associate Professor in Organization at the Department of Business Administration at the School of Economics and Management, Lund University, Sweden. She obtained her doctorate at Lund University in 2006. Her main research interest is change processes in organizations, with a particular focus on cultural and identity issues. She has published book chapters on change management and is currently involved in research on change in a non-profit organization.

978-91-44-09328_01_book.indd 13

2013-04-03 18:19

Author presentations

Fredrik Tell B.A., Lic.Econ, Ph.D. (Linköping University), is Professor in Management at Linköping University, Sweden, where he teaches strategic management, knowledge management and management of innovation. He is the director of the KITE (Knowledge Integration and Innovation in Transnational Enterprise) research group. Current research interests include external knowledge acquisition, project-based organizations, collaborative R&D, patent strategies, and industrial dynamics in complex product industries. He has published articles in Industrial and Corporate Change, International Journal of Project Management, Management Learning, Organization, Organization Studies, Research Policy, Technology Analysis & Strategic Management, and other journals. Contact: fredrik. tell@liu.se Stefan Tengblad is Professor in Business Administration at the University of Skövde, Sweden. He has written books and articles about leadership, managerial work, and employee relations in Journal of Management Studies, Organization Studies, Journal of Business Ethics, Scandinavian Journal of Management, and Qualitative Research in Accounting & Management. Tengblad is also editor of the book The Work of Managers (Oxford University Press, 2012). Niklas Wällstedt is a doctoral candidate at the Institute for Local Government Economics at the Stockholm University School of Business. His research interest is public sector management control, with an emphasis on how different conceptions of value are communicated in networks of humans and technologies. One main research question is how the valuedriven public sector is developing, following New Public Management.

978-91-44-09328_01_book.indd 14

2013-04-03 18:19

Preface

Management is an academic discipline living in a symbiotic relationship with practice. Managers manage, academics study. The latter try to conceptualize and interpret what managers do. Managers and managers-to-be read academic texts and, perhaps, do something with these texts. Some read and then forget, but some interpret and translate the texts into action. And then, later on, their practice becomes new empirical material for scholars. How studies and practice best link up and effectively feed into each other is a question that is constantly a top priority at business schools. One education program at the Stockholm School of Economics is called “Executive Research Program” and is an initiative with the objective of opening up new channels of knowledge flow between scholars and practitioners. This program is an executive summary of a Ph.D. program where practicing managers bring problems into the program, take courses and team up with researchers in order to undertake a scientific inquiry of their subject. As course support, managers were given lectures on the different sub-disciplines of management. Lecturers were given the task of, within their respective sub-disciplines, for three hours, providing a historical account of the field, disentangling the main research area and providing an overview of the most pressing research questions. The task was to provide the participants with a background to the field that was thorough enough to enable them to take part in an academic conference within the sub-field without feeling entirely uncomfortable. These lectures turned out to be tremendously informative and relevant to a much larger audience – be it master’s students, doctoral students, researchers, or practitioners with an interest in the sub-discipline. This was one input into this book. We wanted to translate this idea into a more durable form. We decided to do so by asking specialists from different universities to team up and provide a short review chapter of their areas of expertise. The task was clear: make the reader aware of the roots of your sub-discipline and take them from there to the contemporary world where the discipline now resides.

978-91-44-09328_01_book.indd 15

2013-04-03 18:19

Preface

So, in your hand is a collection of texts, each focusing on central substreams or research areas of the discipline. Of course, the book is by no means all-encompassing. However, we promise that your understanding of the management field will have been taken to a completely different level once you have turned the last page. This is something we dare to say no matter what prior knowledge of the subject you happen to have. ***** We would like to thank the Commissioning Editor, Ola Håkansson of Studentlitteratur, for initiating, supporting, guiding, and monitoring work on this edited volume. In addition, Peter Corrigan of Anglokonsult helped us proofread and language edit the co-authored chapters and thus deserves some recognition for his work. Finally, we would like to thank all the contributing researchers for their commitment to this joint project. Stockholm and Gothenburg, May, 2013 Lars Strannegård Alexander Styhre

978-91-44-09328_01_book.indd 16

2013-04-03 18:19

chapter 1

The Practice and the Discipline: An Introduction to “Management” Alexander Styhre & Lars Strannegård

The roots of a term A Google search on the word “management” generates over three billion hits; less than “love”, more than “hate”, and in the same realm as “sex”. The prevalence of and interest in this term is, mildly put, substantial. Management is a term that can be used to denote an entity or a function. A sign saying “Dissatisfied with something? Contact the Management” and a newspaper headline saying “Low profitability due to bad management” both illustrate two different uses of the term. As an entity, it is a label for a person or a group with the power and responsibility to make decisions and to see to it that they are realized. As a practice, it implies activities such as organizing and coordinating activities that are in line with policies and some kind of goal or direction. The conceptualization of management as a practice was first developed during the second half of the 19th century. It arose alongside and, in the aftermath of, the industrial revolution. But it was during the early decades of the 20th century that scholars and managers started to reflect upon and define management as a practice. Henry Gantt (1919: 111), Frederick Taylor’s disciple and the inventor of the Gantt-chart, speaks of “a system of management” as “a means of causing men to co-operate with each other for a common end.” A few decades later, Berle and Means’ (1934: 196) seminal work defines management as “that body of men who, in law, have formally assumed the duties of exercising domination over the corporate business and assets.” In this definition, those conducting managerial work are targeted; management is a noun, denoting a social class or category. The second part of the definition instead emphasizes the process – the verb – of managing, the practice of “exercising domination over the corporate business and assets”. As early as the 1930s, Luther Gulick (1935) stated that the term management had lost all specific meaning, alternatively proposing, inspired by the

978-91-44-09328_01_book.indd 17

2013-04-03 18:19

chapter 1. The Prac tice and the Discipline: An Introduc tion to “Management ”

French industrialist Henri Fayol, the abbreviation POSDCORB to specify what management was all about: planning, organizing, staffing, directing, coordinating, reporting and budgeting. In many ways, the legacy of this view is discernible in the departments of contemporary business schools. Most business schools or universities have research groups devoted to the various letters that constitute POSDCORD: organization, strategy, human resource management, accounting and managerial control. When, several decades later, Igor Ansoff speaks of management in terms of goal-fulfillment, as “the active process of determining and guiding the course of a firm towards its objectives” (1965: vii), he echoes statements that the heart of management is a set of activities: “the management of a business firm is a very large complex of activities which consists of analyses, decisions, communication, leadership, motivation, measurement and control.” Gantt (1919: 236. Original emphasis omitted) emphasized that such a “system of management” is “[j]ust as much a part of our assets as plant, or equipment.” Managing, stresses Gantt, is a social capacity, a skill, and an organizational resource that may translate into financial and economic performance. Administrative, bureaucratic, and resource-based features of management started to be questioned as early as the 1950s, however. In the mid1950s, Peter Drucker (1955) spoke of management in terms of creativity and entrepreneurship and in terms of being in conflict with a bureaucratic mindset: What then is ‘managing a business’? It follows from the analysis of business activity as the creation of a customer through marketing and innovation that managing a business must always be entrepreneurial in character. It cannot be bureaucratic, an administrative or even a policy-making job. It also follows that managing a business must be creative rather than an adaptive task, the more a management creates economic conditions or changes than rather than passively adopts them, the more it manages the business. (Drucker, 1955: 39)

Besides the internal tensions and differing elements accommodated within the English concept of management, the term is already laden with cultural values and signifiers. Griseri (2002) outlines some of the difficulties of seeking to provide a waterproof, non-situated and universal definition of management: © T h e a u t h o r s a n d S t u d e n t l i t t e r at u R

978-91-44-09328_01_book.indd 18

2013-04-03 18:19

chapter 1. The Prac tice and the Discipline: An Introduc tion to “Management ”

[W]e need to be careful where we start with definitions of the terms ‘management’. Even languages which are closely related to English, such as French, do not have a single term which directly corresponds to it. It is worth bearing in mind that Henri Fayol’s major book on organizations used the French term ‘administration’ – which most English translations have rendered as ‘management’. French and Italian both seem to have at least three terms which could plausibly be translated in English as ‘management’, these being – ‘gestion’ (Fr)/‘gestione’ (It) (associated with getting things done), ‘administration’ (Fr)/ ‘administrazione’ (It) (organizing); ‘direction’ (Fr)/ ‘direzione’ (It) (leadership). Once one gets to a language which is only a bit more remote, such as Russian, there appear European borrowings such as ‘administratsiya’ and ‘directsiya’ but also indigenous terms such as ‘upravlenie’ (with a nuance of control) and ‘zavedovanie’ (with a nuance of organizational leadership) – perhaps surprisingly the Russians have, since the fall of communism, taken to borrowing ‘manager’ and ‘businessman’ almost literally, as a way of reflecting western capitalism. (Griseri, 2002: 26)

In Griseri’s (2002) view, the Anglo-American term management is to be understood as a culturally-saturated one denoting certain ways of thinking and specific institutional conditions. This brief summary of a few of the uses of the term management from the 1910s, 1930s, 1950s and 1970s suggests that management is, in many ways, a floating signifier that can be used to denote both people and processes, verbs and nouns, associated with terms such as administration, organizing, governance, and leadership, and at times clearly distinguished from other organizational regimes (e.g. Drucker’s [1955] use of the term bureaucracy). Since both scientific work and practical pursuit demand (at least temporarily) stabilized and commonly agreed upon definitions of the terms and concepts used to structure shared action, terms having such inconsistency and malleability may be confusing, or even alarming. However, some terms benefit from flexibility and a capacity to almost effortlessly be able to be associated with other concepts and various practices. The concept of management is precisely one such term that haunts the philologist, moving back and forth connecting itself with different analytical frameworks and procedures. Everyday language as well as scholarly vocabularies are composed of denotative and connotative terms (Wittgenstein, 1977), terms that are well-defined (i.e., “concepts”) and terms that are more free-floating and characterized by their “connectivity“ (see, for example, Rheinberger, 2010: 168–169; Kolb, 2008). © T h e a u t h o r s a n d S t u d e n t l i t t e r at u R

978-91-44-09328_01_book.indd 19

2013-04-03 18:19

chapter 1. The Prac tice and the Discipline: An Introduc tion to “Management ”

Since there is often a certain amount of anxiety regarding where to draw the line between “this” and “that,” there are, fortunately, thesauri offering lexical definitions that can help to tame unruly concepts. For instance, the Oxford Dictionary defines management as “The process of dealing with or controlling things or people.” When reading this particular volume, the reader is expected to keep in mind that such lexical definitions do not have an uncomplicated relationship with the scholarly use of terms, and that one of the key practices of scholarly work is to actively problematize and further develop concepts and vocabularies. For the time being, however, the Oxford Dictionary definition serves well the purpose of providing a shared ground for further discussions regarding the concept of management.

Management: Organizing and modernity Regardless of all the intricacies involved in defining management, it is undisputed that the term did not appear until the mid-19th century: “[A]s late as 1840 there were no middle managers in the United States – that is, there were no managers who supervised the work of the other managers and in turn reported to senior executives who themselves were salaried managers,” writes Chandler (1977: 3). Prior to the growth of corporations, the major institutional settings that characterized the contemporary economy needed to be developed, e.g. what Reddy (1984) speaks of as “market culture” in the textile industry, one of the pioneering industries propelling the industrial revolution in England and Flanders (Biernacki, 1995). A step toward such modern industrial capitalism was the abandoning of the medieval guild system that had been regulating industries and mercantile activities for centuries (Hobsbawm, 1975: 36). In 1849, Denmark left the guild system, with Sweden following in 1864. In addition, between 1854 and 1867, the financial markets were deregulated in Britain, Holland, Belgium and North Germany and in the period between 1830 and 1870, foreign trade in Germany, Scandinavia, Britain, Austria, and France increased between four and five times (Hobsbawm, 1975: 50). The 19th century brought significant economic and social changes – swift urbanization, for instance, both propelled by and reinforcing the industrial revolution. These institutional, economic, and social changes called for new professional domains of expertise.

978-91-44-09328_01_book.indd 20

2013-04-03 18:19

chapter 1. The Prac tice and the Discipline: An Introduc tion to “Management ”

The American railways1 (Yates, 1989) and the cotton plantations of the American South (Cooke, 2003) and the sugar-cane plantations of the Caribbean (Stinchcombe, 1995) are pointed out at times as early largeenough corporations in need of a new administrative professional class to handle all the coordination between units and over geographical distances: In their search first for safety, then for efficiency, railroad managers were pioneers in managerial theory and practice. They anticipated the systematic management philosophy in arguing for the need to systematize procedures independent of the individuals involved and to use systematically gathered operational information as the basis for evaluation and decision making at higher levels. The major tools they established to achieve these goals were regular internal flows of communication. (Yates, 1989: 9)

The large department stores opening in metropolitan areas are yet another example where the complexity of the organization was too large for the owner to fully oversee and monitor; consequently, the manager was introduced to serve as an intermediary between the co-workers and the owners (Miller, 1981). As Miller points out, the very idea of leaving management to a professional community outside the ownership sphere caused much anxiety and was originally treated as a most curious idea: In the mid-nineteenth century middle and top management was still a rare phenomenon. Only railroads and a few industries were big enough to create something in the way of a managerial structure. For most business families, loyalty and responsibility were simply not qualities one could rely on an outsider to provide. Yes as the business world grew more bureaucratic and concentrated, delegation of authority became inescapable. (Miller, 1981: 112)

For economists and law scholars, the separation of ownership from the day-to-day control of how resources were used by corporations posed an intriguing problem; the seminal work of Berle and Means (1934) remains one of the classic accounts of how to resolve the inherent conflicts between managers and owners. Agency theory (e.g., Jensen and Meckling, 1976),

1 In North America, railway mileage increased from 2.8 thousand miles in 1859 to 100.6 thousand miles in 1880. In Europe, a similar development occurred as 1.7 thousand miles of railway in 1850 was expanded into 101.7 thousand miles in 1880 (Hobsbawm, 1975: 54) © T h e a u t h o r s a n d S t u d e n t l i t t e r at u R

978-91-44-09328_01_book.indd 21

2013-04-03 18:19

chapter 1. The Prac tice and the Discipline: An Introduc tion to “Management ”

for instance, which distinguishes between the principal (owner) and the agent (the contractor, i.e., the manager) is derived from this discourse. However, the latter half of the 19th century brought unprecedented social and economic upheaval, with corporations tending to grow larger as the industrial revolution spread over Europe and North America. In addition, the latter half of the 19th century also saw the introduction of the professional category of the engineer (Shenhav, 1999), a new professional actor trained in technical and mathematical subjects and an expert in employing numerical analysis to optimize activities. From the period between the late decades of the 19th century and the end of the 1920s, this new social class transformed management into a professional domain of expertise based on rational methods and analytical procedures. Scientific management, at times labeled Taylorism after its founder Frederick W. Taylor, is undoubtedly the most famous system of management developed during that era (Merkle, 1980); however, scientific management was preceded, from the 1870s, by what was called “systematic management”, i.e. standardized procedures for structuring work that emphasized “method” and “system” (Litterer, 1961: 473–474).2 The implementation of such managerial frameworks had significant consequences: The implementation of systematic management led to the establishment of centralized staff departments that planned and controlled the use of personnel. Reporting methods, cost accounting, production scheduling, and incentive plans were the main instruments used to centralize information and align incentives between management and workers. (Reinstaller and Hölzl, 2009: 1006–1007)

The growth of corporations demanded new administrative staff and, between 1870 and 1920, the “[c]lerical work force increased from 0.6% 2 In fact, as Guillén (1994) stresses, scientific management was regarded by many employers as a rather controversial system as it demanded substantial control of the workers and served to deskill them as their work assignments were reduced to their elementary components. Many companies chose to implement alternative systems, e.g. the popular Bedeau system. Münsterberg (1913: 49), the founder of the discipline of industry sociology at Harvard, summarized the skeptical attitude among both practitioners and scholars thus: “Those followers of Frederick W. Taylor who have made almost a religion out of his ideas have certainly often exaggerated the practical applicability of the new theories, and their actual reforms in the mills have not seldom shown that the system is still too top heavy; that is, there are too many higher employees necessary in order to keep the works running on principles of scientific management.” © T h e a u t h o r s a n d S t u d e n t l i t t e r at u R

978-91-44-09328_01_book.indd 22

2013-04-03 18:19

chapter 1. The Prac tice and the Discipline: An Introduc tion to “Management ”

to 7.3% of the total [American] workforce,” report Reinstaller and Hölzl (2009: 1009) (see also Yates, 1989: 43). They continue: “In absolute numbers this corresponded to a rise from 881,619 to 3,111,836 workers. Women, who represented less than 3% of the clerical work force in 1870, totaled 45% in 1920.” Perhaps sales of new office machines, e.g. typewriters, can serve as a proxy for the institutionalization of new management practice: “In the 1870s and 1880s there was hardly any business demand for typewriters, promoters and manufacturers saw the typewriter as [a] tool for novelists and poets; it was even called the ‘literary piano’” (Reinstaller and Hölzl, 2009: 1010). However, between 1886 and 1900, annual sales of typewriters grew from 15,000 to 140,000. In summary, the concept of management has its roots in mercantile activities, in the church and in military organization; however, it was not until the mid-19th century that the professional category of the manager, being neither the owner nor the worker, was introduced into industry and, eventually, into administration. Being originally a practical term – many of the early contributors to the field, including Frederick Taylor, Chester Barnard, and Henri Fayol, were practitioners – the scholarly study of management took off after WWII. Anxieties regarding the role and status of business schools and the disciplines of management studies, business administration, and so forth, are a direct consequence of the blending and mixing of two institutional logics, i.e. that of the practical utility of the professional training school and that of the scholarly meditation rooted in the medieval university and, ultimately, in the Catholic Church.

Management as a scholarly field of research The classic faculties of the medieval university, with its roots in the churches and on the Italian peninsula, taught theology, medicine, and law. Until at least the first half of the 19th century, there were no social sciences. The passe-partout term “philosophy” included all the thinking that pertained to social organization. In 1839, August Comte coined the concept of sociology as the systematic study of social systems, with disciplines such as political science and political economy (eventually renamed economics) being developed during the nineteenth century. The social changes including urbanization called for new domains of scholarly work; for instance, criminology became a hall-mark science of that century and, in popular © T h e a u t h o r s a n d S t u d e n t l i t t e r at u R

978-91-44-09328_01_book.indd 23

2013-04-03 18:19

chapter 1. The Prac tice and the Discipline: An Introduc tion to “Management ”

culture, the crime novel, invented by Edgar Allan Poe, became immensely popular. In the urbanized society, the common man, or even one’s nextdoor neighbor, displaced ghosts or other horrors from folklore as sources of anxiety. Also, disciplines such as chemistry (Bensaude-Vincent and Stengers, [1993] 1996) and what would eventually become biology (Keller, 2000) were consolidated and institutionalized during the 19th century, with the German university system as the undisputed prototype – a role today played by American and a few British elite universities. However, in France, medical schools were developed outside of the conservative and stodgy university system during the early decades after the Napoleonic wars, with medicine being transformed into an experimental science by pioneers such as Xavier Bichat and Claude Bernard (Bynum, 1994). During the course of the 19th century, the modern university system developed. In 1881, the first business school was founded at the University of Pennsylvania in Philadelphia, complementing the technical universities and polytechnics teaching engineers, and, at the beginning of the new century, the very idea of management as a legitimate professional domain of expertise was further institutionalized. During the period from 1895 to 1915, and then to 1924, the number of business degrees in the US grew from 97 to 9,323, and then to 47,552. (Khurana, 2007: 89). In addition, Thrift (1998) emphasizes how certain journals and consultancy firms were started during the interwar period: The Management Review was founded in 1918; the Harvard Business Review in 1922; and the American Management Association in 1925. By the end of the WWI, Arthur D. Little, originally an engineering firm, included management advice in its services; James McKinsey started his consulting firm in 1925. (Thrift, 1998: 171)

Mary Parker Follett (1941) spoke of “management as a profession” during the interwar period in order to underline how organizing and leadership had become a domain of professional expertise in its own right. During the period, management as a professional domain became increasingly a domain of research as, for instance, the Ford and Rockefeller foundations financed research in the US (Khurana, 2007). As Corley and Gioia (2011: 15) emphasize, the point of departure for the emerging business schools and the field of management studies was not scholarly contempla-

978-91-44-09328_01_book.indd 24

2013-04-03 18:19

chapter 1. The Prac tice and the Discipline: An Introduc tion to “Management ”

tion but practical utility, with practical utility promoting a syncretism and an open attitude toward other disciplines: “Organization and management studies started out with a couples of distinctive attributes: reliance on anecdotal evidence from business practice (there was little ‘scientifically’ coded knowledge) and eclecticism (we borrowed from everybody).” However, by the late 1950s, a few critical reports had burn-marked business school research as “unscientific” and anecdotal; ever since, business schools have struggled with the potentially incommensurable virtues of “rigor” and “relevance” (Kieser and Leiner, 2009; Palmer, Dick, and Freiburger, 2009; Pfeffer and Sutton, 2006; Gosling and Mintzberg, 2006; Bennis and O’Toole, 2005; Pfeffer and Fong, 2002; Starkey and Madan, 2001). Perhaps like no other publication during recent decades of constant worry over the role and status of business school research, Rakesh Khurana (2007) has captured the ennui of the management scholar caught in a double bind situation where the choice between “rigor” and “relevance” leads to a sense of being sidelined: Anyone who spends time in an elite business school today knows that it is a place riddled with contradictions. Faculty are hired and promoted on the basis of discipline-oriented research that … often has little or no bearing on the practice of management. Inside the classrooms … faculty and their students have little in common in terms of shared experience and interests; in contrast to such milieus as law or medical schools, many business school faculty members no longer identify with their MBA students, and not surprisingly, their students no longer identify with them … The undermining of faculty authority is exacerbated by everything from lax grading policies, to the dramatic growth in the number of practitioners employed as lecturers and adjunct faculty in order to compensate for the diminished credibility of the full-time faculty, to the lavish facilities with which the more affluent business schools try to lure students, as if they were already potentates rather than apprentices (Khurana, 2007: 369–370).

Regardless of such debates and “science wars” during the contemporary era, the scholarly study of management is not only of practical and professional interest as sociologists, psychologists, and political scientists have also started to study managerial practices and administration. Today, disciplines such as anthropology have shifted their focus from studying indigenous peoples to studying the worlds of business (e.g., Rabinow and Dan-

978-91-44-09328_01_book.indd 25

2013-04-03 18:19

Management An advanced introduction

An advanced introduction

Management

| Management

Lars Strannegård Alexander Styhre (eds.)

Lars Strannegård, Ph.D., is Bo Rydin and SCA Chair in Leadership, Department of Management and Organization at the Stockholm School of Economics.

Editors

Lars Strannegård Alexander Styhre

www.studentlitteratur.se

978-91-44-09328-4_01_CoverHB_4utan.indd 1

2013-04-08 09.29