July 10, 2006

News & Opinion: I found the five myths while clearing off my desk.

By: 800-CEO-READ @ 4:15 PM – Filed under: Management & Workplace Culture

Friday was a good time to clean off my desk. And, of course, I found little treasures that were hidden somewhere in the day-to-day tasks and projects. Todd once claimed that his mom would send him home with articles, books and other treats when he departed.

My parents do the same; the latest was a stack of articles on business, everyday superheroes and investing. Here's one of the pieces that was in there.

Titled The 5 Myths of Management, it's on the book Hard Facts, Dangerous Half-Truths and Total Nonsense. You may recognize the book from Todd's interview with the authors.

The idea behind the book is that some of what we deem to be true is not necessarily so. Some of the maxims we follow shouldn't be followed (or at least not universally). As authors Pfeffer and Sutton say on business practices: "'If doctors practiced medicine the way many companies practice management, there would be far more sick and dead patients and many more doctors would be in jail.'" Hm. That's quite a conclusion--and slightly scary.

The Myths:
  1. Financial Incentives Drive Good Performance.
    Why it's a myth: People will "'focus on what it takes to get the incentive,'" rather than what will make the successful company. Why do companies continue to use it: "'Simple intellectual inertia.'"
  2. First-Movers Have the Advantage
    This is not necessarily true. Sometimes cost advantages may be more prevalent if you're the second mover. Just look at Xerox who created the first PC and Netscape with the Internet browser--both were first movers.
  3. Layoffs Are a Good Way to Cut Costs
    Sure this is an easy way to knock off a few dollars on the expense report but what about employee morale and it's effect on customers?
  4. Mergers Are a Good Idea
    "The vast majority of mergers fail to deliver their intended benefits--about 70 percent, according to some estimates." Of course, there's an exception to every rule but it takes work to make them successful.
  5. Life and Work Should Be Kept Separate
    Again, not necessarily true in every case. Southwest Airlines aims to be one big family which includes sending employees birthday cards and congratulations cards on their annual hire date and more. The result: "Southwest attracts 30 or more applicants for every job opening."