1376
n
Myths in management
package (salary and bonus) . . . Yep, you guessed it, and the effects
were very strong: if a CEO’s rm adopted one of the popular
management techniques, his compensation went up.
So what does this tell us? Well, rst of all of course that many
of these management fads simply don’t work. The organization
doesn’t perform better as a result of adopting any of them. Yet,
apparently, it does make you look innovative and legitimate in
the eyes of others. This includes fellow executives, who subse-
quently vote for you as being “much admired” but – hurrah!
– also in the eyes of your board; they enthusiastically pat you on
the back for the great achievement and, with grace and thanks,
increase the size of your compensation package.
Remember this one: “total quality management”?
Many popular management practices, as scientic research
persistently shows, are quite useless. They simply don’t work. Yet,
they’re often imitated. As discussed in previous chapters, that’s
largely because rms have a general inclination to imitate each
other, and that certainly includes imitating silly things.
Mark Zbaracki, a professor at Wharton, found himself examining
total quality management (TQM) techniques in the early 1990s,
when the thing was at its heyday. He made extensive visits to
ve organizations – a defense contractor, a hotel, a hospital, a
manufacturing rm and a government agency – to gure out
how they came about adopting TQM.
A very consistent pattern emerged. Invariably, when management
started to hear about this “new thing” called total quality
management, they signed up for seminars and conferences in
which representatives from other rms spoke about their experi-
ences of the implementation of TQM. There they would hear
about the substantial improvements TQM had brought them,
often larded with impressive statistics and commanding jargon.
It didn’t take long and the managers became convinced that
they too had to adopt this new technique, or risk falling behind
forever.
Business Exposed138
So they started sending their people to TQM training courses
and hired consultants that specialized in the new techniques,
through which they learned more stories about the power of
TQM and its remarkable results. Soon, they put their consid-
erable weight behind a pilot: one department would experiment
with the new techniques, so that others could learn from them.
This was often followed by the introduction of a series of internal
seminars, a quarterly TQM newsletter sent to all departments within
the organization, and the appointment of dedicated internal TQM
experts. Subsequently, all these parties were told to publicize the
rm’s early “success stories” to enthral others and raise enthusiasm
in the rest of the company to embrace the new technique.
Soon, the newsletters found their way to people at other
companies, and the organization’s managers started to receive
invites to come and share their success stories at TQM confer-
ences and seminars. Yet, in reality, for every “success story” there
were always a handful of failures. Yet, those stories did not nd
their way into the newsletters, the company’s external commu-
nications, or the manager’s slick seminar slide pack.
And in the conference room, the attending managers who had
heard about this new technique were in awe of the substantial
improvements that TQM had brought the speaker’s rm, and they
were impressed with the optimistic statistics and commanding
jargon. And they too went back to their rms, and proclaimed
that they really had to adopt this new technique, or risk falling
behind forever.
The spread of the management practice becomes a self-enforcing
cycle. It almost acts like the rabies virus. As Professor Richard
Dawkins explained in The Selsh Gene, the virus’s well-known
hydrophobic symptom, causing an infected dog’s mouth to
“foam”, encourages it to shake the wet from its mouth and with it
the virus. This promotes the virus’s spread. Moreover, it turns a dog
into a restless wanderer, propagating the virus even further aeld.
Similarly, a silly management practice may be stimulated to
increase in frequency if it comes with a mechanism that causes
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