Selected Paper No. 53

Good General ManagersAre Not Professional

H. Edward Wrapp

Graduate Schoolof Business

The Universityof Chicago

H. EDWARD WRAPP is Professor of Business Pol-icy and former Associate Dean for ManagementPrograms at The University of Chicago’s Grad-uate School of Business. A 1938 graduate ofthe University of Notre Dame, he received hisM.B.A. and D.C.S. degreees from Harvard in1948 and 1952. His major areas of interest arethe job of the general manager, managementdevelopment, and formulation and implementa-tion of corporate strategy. He is a member ofthe board of several corporations: CochranDevelopment Corporation, Melbourne, Florida;EMS Industries, Lebanon, New Hampshire;Federal Express Corporation, Memphis, Tennes-see; GEICO Corporation, Washington, D.C.;Loctite Corporation, Newington, Connecticut;New Court Private Equity Fund, New York,New York; Pittway Corporation, Chicago, Illi-nois; Richardson Company, Chicago, Illinois;and Sargent Welch Scientific Company, Chi-cago, Illinois. Mr. Wrapp is a former Professorof Business Administration at Harvard Univer-sity. This paper was initially presented in Chi-cago on February 12, 1979 at a luncheon spon-sored by the Executive Program Club of theGraduate School of Business at The Universityof Chicago.

Good General Managers AreNot Professional

INTRODUCTION

An organization is doomed to mediocrityunless it is guided by good general managersin key positions. A company can bumblealong for years, but good general managersare the ingredient which will make it standout from the pack. No matter how rich itsother resources such as technical know-how,uniqueness of product, market monopoly,ample finances, or luck, an organization willnot excel unless it is led by what are becom-ing increasingly rare individuals.

Good general managers have always beena scarce commodity, but today the widespreadaddiction to professional management is dry-ing up the supply. A minority of the so-calledprofessional managers who are moving intothe top positions exercise a high level of gen-eral management skills. You might even con-clude from watching the professionally man-aged companies at work that they have setout to organize general managers into im-potence.

The system is producing a horde of pro-fessional managers with demonstrable talents,but talents which are not in the mainstreamof the enterprise. Professional managers candescribe management concepts, apply eleganttechniques, catalog the tools available, andmake penetrating analyses of problems. Insome organizations, they can succeed if theyare simply good at making presentations tothe board of directors, or writing strategiesand plans, or even creating imaginative posi-tion descriptions. The tragedy is that thesetalents may mask real deficiencies in overallgeneral management capabilities. These tal-ented performers often fail miserably whenthey are charged with earning a profit, get-

2 Selected Paper No. 53

ting things done, choosing a strategy andbacking up that choice, and moving an orga-nization forward.

Professional managers can survive and eventhrive and advance in the bureaucracies oforganizations. It is often when they are pro-moted to a general management position thatthe fatal flaws appear.

Professional general managers are willingto study, analyze and define the problem, butthey run for cover when the grubby operatingdecisions must be made. They rationalizetheir behavior by delegating the implementa-tion to subordinates while they move on tothe next big policy decision, or begin anotherreview of corporate strategy, or make a speechto the financial analysts.

Generally, it is a good general manager,not the staff specialists, who makes a com-pany go, who turns an idea into a commer-cial success or converts a major disappoint-ment into an opportunity which catches fire.When a serious operating problem arises, thegood general manager jumps into the thickof the fray, collects all kinds of inputs, andstays close to the action until he is certain thathis subordinates have diagnosed the situationand are on their way to a solution.

The job of the general manager is integra-tion. While the ultimate integrator is thechief executive officer of an organization, jobswith large elements of general managementmay be found under titles such as president,chief operating officer, division manager,product manager, branch manager, storemanager, or plant manager. The chief execu-tive officer enjoys not only the greatest free-dom, but also carries the most awesome re-sponsibilities because his final tollgate is aboard of directors which may understandlittle about the company. Moving down to

H. Edward Wrapp 3

lower levels more constraints are imposed onthose in general manager positions, diminish-ing the uniqueness of the role. Whatever thetitle, the general manager is the one whomust convert the throngs of specialists into avibrant enterprise.

The combination of higher education andon-the-job experience is producing a genera-tion of management candidates who have lit-tle training or appetite for the job of generalmanagement. Whether the aspiring men orwomen come from a graduate school or fromhumbler origins, the organization immersesthem in highly specialized units which rein-force the concepts implemented by the schoolor by books on management.

Most good general managers probably de-velop in an environment requiring quick andcontinual response to change. In such an en-vironment, the person who is stimulated tohis best thinking by the unexpected willemerge as a leader. This manager learns todeal calmly with difficult developments whichcannot be anticipated. He faces the unfore-seen with appetite and equanimity. By con-trast, the person who develops in a highlycontrolled environment where the lead timesare lengthy and everything is studied andplanned does not gain the self-confidenceneeded to deal with the unexpected.

Defining a professional general manager ismore difficult than describing the things hedoes. He immerses himself in a world of tech-niques, planning, financial controls, budgets,financial incentives, explicit manuals on whatto do and how to do it, neatly defined jobresponsib i l i t ies , reorganizations, orderly re-porting, and formal training programs. Con-ceptually, he is steeped in specialization, stan-dardization, efficiency, productivity, andquantification. He insists on objective goals

4 Selected Paper No. 53

such as earnings per share and return on in-vestment. He prefers to work with aggregatesand averages rather than with random bits ofinformation. His initial response to a prob-lem is to turn to his staff for in-depth studiesand ‘to consultants for advice on every topicimaginable. He takes great comfort in mak-ing long lists of problems, facts, variables,conclusions, and alternatives. In his mind, theastuteness of the management correlates withthe length of the lists. He likes to make pol-icy decisions and to embalm all the policiesin elaborate manuals.

The good general manager takes a radicallydifferent approach to all the new manage-ment devices. He learns everything he canabout them, but is more skeptical and there-fore more cautious in how he introduces themto his operation. He recognizes their logicand value, but refuses to permit them to beoverrefined. When the professional generalmanager discovers that a technique is notworking, he will allocate more resources torefining it-both its concepts and its applica-tions. The good general manager has learnedthat overrefinement of the technique reducesits effectiveness, and so he refuses to let thespecialists in his organization spend inordi-nate time on this activity. The technique maynot be working for a host of reasons unre-lated to the technique itself.

The officer in charge of operations researchfor a large company admits the overrefine-ment of his work :

We still tend to develop solutions whichare more elaborate than the problem merits.The tools of operations research tend toencourage excessive detail which in turnlengthens the period needed for develop-ment of a solution. It is a common failing

H. Edward Wrapp 5

of OR specialists to come up with a solutionlong after the problem has been solved or isstill of major concern to top management.

The professional manager permits the re-finement and use of techniques long aftertheir practical value has been exhausted. Heis often intrigued with the elegance of thetechnique, and therefore is reluctant to with-draw support for the work of specialists whoshare his fascination. This love affair is muchlike that of the research engineer for a producthe designed, or of the plant manager for anew machine tool, or of the controller for amanagement information system.

The good general manager uses techniquesonly so long as they contribute to overall re-sults and objectives. He is quick to containtheir use once his basic purposes have beenmet. He would not tolerate the kind ofequivocation which was observed at “The In-dustrial Products Company”:

Market research activity was carried on infour different units of corporate headquar-ters. The vice presidents of marketing, cor-porate planning and economic analysis eachhad a unit reporting to them, and the vicepresident of sales conducted his own mar-ket studies in a planning unit for sales.Whenever anyone attempted to coordinateor reconcile the findings of the variousunits, the differences in interpretation andfindings were generally sharp enough toend in stalemate. And, of course, each divi-sion manager conducted his own studies, in-dependent of the corporate studies. Settingaside the cost and confusion of the dupli-cated activities, one division manager ques-tioned the validity of the work: “The cor-porate market researchers are insensitive to

6 Selected Paper No. 53

the significant changes in the market. Theyare so busy getting answers to the wrongques t ions , analyzing their findings, andmisinterpreting what they hear, that wepretty much ignore their recommendations.In a week of talking to the right people,one or two experienced salesmen can learnmore about acceptance of a proposed prod-uct than the market researchers can learnin six months.”

In many quarters today, there is gleeful dis-dain for what has become known as con-ventional wisdom. While the professionalmanager dismisses it as sorcery and folklore,the good general manager may question oneof its tenets, but he never ignores it. Ratherthan belittle it, he searches for the experienceof generations of intuitive leaders which maybe distilled in the admonitions of convention-al wisdom.

When some strange new threat surfaces forthe first time, a good general manager maybe temporarily stunned, but he takes courageas he begins to think his way through theproblem. The professional manager is morelikely to look for a book on the subject, orfind an expert who can give advice, or deter-.mine how professional managers in othercompanies have responded in a similar situ-at ion .

APPRAISING GENERAL MANAGERS

Our knowledge of what makes a good gen-eral manager and how to recognize one is ex-tremely limited. An earlier paper, Good Man-agers Don’t Make Policy Decisions,’ discussedthe five most critical skills of the generalmanager:

1 Selected Paper- No. 26, Graduate School of Business,University of Chicago.

H. Edward Wrapp 7

1. The good generalmanager keeps open a considerable range ofpipelines within and without the organiza-tion. He continually checks his subordinates’perceptions of th eir problems against the size-up of others. He knows where to go in theorganization for reliable information, andfrequently bypasses the chain of command.

2. Focusing on the key issues. The goodgeneral manager knows that he must concen-trate his attention on certain issues. They maybe ones which only he can deal with, or oneswhich he is best qualified to deal with, or oneswhich the organization has not yet perceivedas significant, or ones which actually threatenthe survival of the organization. In the faceof impossible demands on his time, he mustremind himself regularly to avoid beingswamped in detail.

3. Knowing how hard he can push theorganization. A good general manager knowsthat he must not impose a heavy load of hisown ideas on the organization. If he goes toofar, indigestion in the form of resistance fromthe organization will disrupt and postpone hisprograms. Only during crises will the organi-zation accept the dictates of the boss withtolerable resistance.

4. Giving the organization a sense of direc-tion. In many instances, the organization canproduce a viable strategy, but should it falter,the good general manager must have in hisown mind a concept of where he is trying totake the organization. He will translate thisconcept into a language appropriate to eachlevel of the organization so that he can gainsupport for his intended strategy. A formalcorporate strategy often results from the exer-cise of this skill.

Selected Paper No. 53

tionships in the stream of operating decisions.Th e good general manager does not permithimself to be insulated from operations be-cause he knows that the most innovative ele-ments of an overall strategy may evolve fromopportuni t ies presented by operat ing decisions.

These five skills, then, become benchmarksfor appraising a general manager. As a fur-ther set of criteria, it is useful to evaluate per-formance of several demanding tasks whichare in the general manager’s domain:

1. To produce a continually increasingstream of profits. Our system demands monthafter month increases in earnings. Never isthe general manager permitted to acknowl-edge that his organization has come througha difficult period, is emotionally and physical-ly exhausted, and needs a release of pressurefor a period of recuperation and consolidation.Recuperation and consolidation are accept-able, but only if earnings do not suffer.

2. To instill a sense of urgency. Instilling asense of urgency is more vexing than ever be-cause so many of the new management de-vices such as long-range planning get in theway of stimulating such an attitude. Formali-ties and structures and systems all work todampen a sense of urgency. For example, themost productive organizations seem to be im-bued from top to bottom with the determina-tion to respond immediately to any customerneed, even if it’s irrational or virtually impos-sible to satisfy. Nothing stands in the wayof delivery, or redesign, or special service insuch an organization. Not everyone can get‘hyped up’ about meeting budgets or increas-ing earnings per share, but everyone can be-come a fanatic on customer service.

H. Edward Wrapp 9

flow of new prod-ucts. This task may be the most significantone in assuring a healthy future for a com-pany or a division. But despite all of the pub-licity about new technology and the rewardsfrom research and development expenditures,new products which can support the succes-sive tollgates of discovery, design, testing,regulatory approval, and market introduction,are growing harder to find.

4. To get people to work together. Thistask is at the center of the general manager’sresponsibilities. To quote Professor Andrews :“ . . . he must find a way to make organiza-tional goals more attractive than departmentgoals.“’ And yet the constant reorganizationswhich plague some companies seem bent onfinding arrangements which permit people toshelter themselves in isolation from the bur-den of relating to other parts of the organiza-tion or its overall goals.

5. To identify, develop and hold topflightpeople. In today’s milieu of subordinates whoare more highly educated, more mobile, andmore likely to identify with a professionalorganization than to give their loyalty to anemployer, the general manager finds the toolsof personnel administration totally inadequatein coping with this crucial fifth task.

As the general manager tries to meet thetest of acceptable performance on all of thesetasks, he discovers that the developments ofmodern management are increasing the com-plexities to a point where his overall effective-ness is severely hampered.

In order to sharpen comprehension of thedifferences in approach between professional

2 K e n n e t h R . A n d r e w s , The C o n c e p t o f C o r p o r a t eStrategy, Dow Jones-Irwin, 1971.

1 0 Selected Paper No. 53

general managers and good general managers,it may be useful to focus on a few favoritetechniques of modern management.

THE PARADOX OF PLANNING

The formalization of long-range planningis probably the most significant general man-agement technique to emerge in the pasttwenty-five years. But this tribute must bequalified by a disclaimer: the true impact ofthe technique has been minimal. Perhaps thepromise has never been realized because theexpectations were too high, expectationswhich were built up by planners and con-sul tan ts .

The introduction of formal long-rangeplanning almost always leads to overemphasison the technique. The people assigned toplanning may find it to be a welcome respitefrom operating problems. It is intellectuallymore rewarding. It does not carry the pres-sure which operations entail. Professionally, itis more respectable. Board members and otherinfluential outsiders give it high status bytheir interest and support.

Th e professional general manager willprobably set up a staff for planning and hireconsultants to reinforce the staff. He will en-courage the preparation of a planning manualand a proliferation of forms to be filled out bymany different units in the organization. Hewill stress the preparation and analysis of thenumbers which summarize his plans. He willdemonstrate his mastery of the numbers inpresentations to corporate management andthe board of directors. He may even convincehimself that preoccupation with the numbersis the best focus for the exchanges amonghis subordinates and with corporate manage-ment.

One corporation I am familiar with em-

H. Edward Wrapp 11

ployed a consulting firm to devise an overallcorporate strategy. Over a period of fourteenmonths and after the expenditure of almost$200,000, the consultant produced a report;however, the report stimulated almost no ac-tion in the management group. About a yearlater, the company hired a director of plan-ning. He elected to approach his new taskby organizing discussions throughout thecompany on the mechanics of planning. Aftersome nine months of discussions, manage-ment has still not been able to agree on howplanning is to be carried out. Almost threeyears have elapsed, and management is stilldiscussing h o w to plan.

By contrast, the good general manager andhis operating managers may appear to be al-most indifferent to the planning activity, ifnot openly derisive in their comments. Thegeneral manager may see planning as handi-capping his efforts to instill a sense of urgencyin the organization. He is skeptical that theentrepreneurial function can be synthesizedby planners. He has discovered that the futurecannot be predicted with any great certaintyand that he must hedge against any one ofseveral eventualities. He knows that managersget more rewards for short-term results andthat the first team of players probably willhave changed before the long-term arrives.He observes that the long-term thinking haslittle impact on operating decisions. He is dis-turbed by the planners’ insistence on globalor total strategies. He is reminded constantlyof the ineptitude of the planners in trying toinfluence operating managers. He has ob-served that planners start with an analysis ofaggregates and look for opportunities ratherthan identify a need and try to fill it. He isreminded daily of the crises, major and mi-nor, which demand a quick response rather

12 Selected Paper No. 53

than in-depth study. He recognizes that hisbest operating managers are not nimble inthinking theoretically or hypothetically. Andif he is a division manager, he spends a goodportion of his time trying to reconcile the con-flict between corporate management and hisdivision, much of which is generated aroundthe planning process.

At heart, the good general manager knowsthat he and his organization must be con-cerned with long-range plans, for the strategywhich evolves from planning is essential toholding together the ever-growing swarms ofspecialists who work for him. Periodically, hepulls out the plans for review with his sub-ordinates, but he avoids the constant naggingand reference to plans which over time mayconvince them that skill in planning is theonly thing that matters.

One successful general manager who takesan extreme position against planning, de-scribes his dilemma in these terms:

We pay strict attention to details. Thecompany will do all right so long as every-one here understands how important thatis. We plan operations carefully. When wemoved to this location a couple of yearsago, we planned it so carefully that wemoved on a Saturday and Sunday, andwere back in operation on Monday. But wedon’t even draw up a one-year plan orbudget. An organization is likely to go staleand forget details if they emphasize budgetsand long-term plans.

Clearly, the professional general managerand the good general manager pursue diver-gent courses as they try to harness the powerin the planning process.

THE EMPTY PROMISE OF REORGANIZATION

Frequent and major reorganizations are an

H. Edward Wrapp 13

obsession of the professional general manager.Reorganizations are proposed as the solutionfor all kinds of problems from lagging earn-ings to nagging operations quagmires. Ifmanagement is under fire, the critics can usu-ally be silenced by a reorganization. The an-nouncement of a reorganization carries withit a symbol of decisive action; and yet, if youobserve an organization over a period ofmonths, how often does it go through a seriesof changes and then revert to structures whichwere earlier abandoned ?

The professional general manager takes anorgiastic delight in rearranging the boxes onthe chart, changing the reporting relation-ships, concocting new titles, polishing the jobdescriptions, and moving the players from jobto job. Specialization is a way of life for him.He has been taught to break a problem intoparts for analysis, so it is a natural tendencyto fragment the management element in anoperation. Part of the rationale for the con-tinual movement toward greater specializa-tion in jobs is that the narrower the responsi-bility, the greater the opportunity to developtechnical expertise. And many organizationshave grown so complex with legal, account-ing, financial, social, scientific, and legislativedimensions that a generalist is not able tomaster the many areas of expertise. In thisenvironment, a powerful argument can bemade for accumulating inside specialists inorder to avoid the use of expensive outsidespecialists. And, of course, at some point asthe boxes increase, more levels of manage-ment must be added to supervise the units.

One victim ofknown company ispened to him:

Once upon a time I was an all-roundmarketing man. I knew my product line,

specialization i n a well-bitter about what has hap-

14 Selected Paper No. 53

my customers, the competition. Over theyears, they have whittled away at my jobuntil today I am strictly an order-taker. Theproduct managers plan the strategy. Themarket researchers study the market bytalking to strangers. They aren’t even in-terested in my opinions. So, I say, “To hellwith it. Let somebody else do the thinking.”

The good general manager is wary of re-organizations. He reluctantly adds boxes, buthis boxes represent general management as-signments rather than staff specialties. In deal-ing with additional complexities, he searchesfor opportunities to split off new profit cen-ters. They offer great opportunities for devel-oping general managers and often at low riskto the overall company.

The increasing emphasis on specializationis a strong deterrent to getting people to worktogether. When a professional manager is con-fronted with subordinates who are not work-ing together, he asks his organizational plan-ner to devise a system so that they need notwork together. If he can create enough boxeson the chart for more specialists and can de-fine job responsibilities precisely, the duties ofeach manager will be so well-known that theywon’t need to work together. Each can pursuehis own interests without interference fromothers .

In contrast, the good general manager ques-tions the long run benefits from reorganiza-tion. He is likely to concentrate on makingthe present organization work rather thandevising drastic changes. He has seen thehavoc wrought by reorganization and sees itsprimary benefit as a device for keeping man-agement consultants off the welfare rolls. Heknows that major reorganizations almostnever deal with the real problems. He insists

H. Edward Wrapp 1 5

that his organization be lean with a minimumof staff departments. It is difficult for over-specialization to make much headway in alean organization, because the demands of thecompany require that each member of man-agement keep closing the gap and trying hishand at something where he is not a specialist.So a lean organization is consistent with anorganization strategy of low profiles for spe-cialists. One successful company president de-scribes his difficulty in persuading his staffsubordinates to relate their activities to theoverall company goals :

A good part of my day is spent in cuttingthe staff people down to size. I don’t wantto demoralize them, but most of them havean inflated idea about their contribution tothe company. They seem to be dedicatedto finding something wrong as justificationfor their existence. They would be moreuseful to me if they could plan their workin the context of things going on in otherstaff departments and in the offices of theline managers.

Keeping the organization lean, or under-staffed, may be one of the most effective de-vices for maintaining a sense of urgency. Em-ployees who are stretched out and workingharder than they ever thought they could,don’t have time to devise a complicated solu-tion for a problem which doesn’t require suchan approach.

As an example of how the malignancy ofthe staff departments grows, the president ofa medium size company explained the rapidbuild-up of staff specialists to his board ofdirectors in these terms:

We must have staff departments as cap-able as those of the large companies with

16 Selected Paper No. 53

which we compete. There is a minimumsize, below which a staff function is of lim-ited value. The reason for this is that capa-ble men will not be attracted to small stafforganizations in our type of business be-cause the functions of a small staff wouldnecessarily be limited to service-type workwithout opportunity for broad and signifi-cant accomplishments.

The staff people who work for this profes-sional general manager are being invited todivorce themselves from day-to-day opera-tions, although direct involvement in opera-tions might be just the vehicle they need toestablish their competence with the rest ofthe organization.

The professional general manager createsfor himself a sense of security with his retinueof specialists. He sees all of the advantagesof an ever finer division of labor, but choosesto ignore the disadvantages. The good generalmanager, as he observes the specialists bankedaround him, concludes that either deliberatelyor inadvertently they are condemning him toless risk-taking, less innovation, and moreinaction.

AN OVERDOSE OF STANDARDIZATION

Standardization is one of the powerful pillsin the professional manager’s medicine kit.In small dosages, it works wonders; so ifsymptoms persist, ever larger dosages are pre-scribed. As the vice president of manufactur-ing in a multi-plant company sees it:

Our strong push for standardization ex-tends to all twenty of our plants. It facili-tates everything we are trying to accom-plish : reduce costs, improve schedules,control quality, automate the processes, sim-

H. Edward Wrapp 17

plify the product line. One of the reasonswe have picked engineers for the plantmanagement positions is that they alreadyrecognize the advantages of standardizationand don’t have to be sold on its merits. Wesee no limits to the benefits of continuingthe push which began when I was movedinto this job four years ago.

Professional managers, whether in generalmanagement or one of the functional areas,echo similar opinions. The controller pro-motes the concept because it facilitates finan-cial controls and budgets; many sales mana-gers see it as a way to escape from the un-reasonable customer demands for custom-made products or as an answer to complexpricing and distribution problems; most man-ufacturing managers support the views of themanufacturing vice president just quoted; theengineers who invented standardization areevangelistic in their advocacy; and, of course,the professional general manager sees it as amajor step toward simplifying coordinationof the various units which report to him.

The professionals in general managementand in sales are volume-oriented, and there-fore are searching for the high volumes whichoften accompany standardization. Many com-panies have been persuaded to abandon low-volume, high-margin products in favor ofhigh-volume, low-margin products. The “oldfashioned” customer who voices his willing-ness to pay extra for custom products or ser-vices is silenced between blankets of modernmanagement.

The good general manager is one of thelast bastions in the defense against the ex-cesses of standardization. He recognizes thata pervasive preoccupation with standardiza-tion builds resistance to the introduction of

18 Selected Paper No. 53

new products; that it results in manufactur-ing plants which are difficult to adapt tochanging market conditions; that it reducescustomer service to routine simplistic re-sponses which satisfy no one; that it leads tothe most destructive kind of price competi-tion; and that it nullifies the negotiating skillsof his best salesmen. He sees the “standard-ize-it” mentality as the antithesis of the in-novative mind. Much of his ammunitionmust be wasted on shooting down the ex-tremists who see no practical limits to thestandardization movement.

MANAGEMENT CONSULTANTS

The management consultant has become astatus symbol for the professional generalmanager. The hundreds of management con-sultants who roam the business world haveprovided much of the horsepower for the pro-fessional management movement, for thetrappings of the movement are readily sale-able merchandise. The mystique of the con-sultant is reflected in these comments by adivision manager in a large conglomerate:

It is virtually impossible for a divisionmanager to gain approval from the corpo-rate office for a project of any size unless itis supported by a report from an outsideconsulting firm. In refusing to play thisgame I have relied on my own staff. Thispolicy has confirmed to my staff specialiststhat they are the experts I have confidencein and will rely on. As a consequence, thestaff work in this division is the best inthe company.

The professional general manager’s firstthought when a problem arises is to find thebest experts available. He has no hesitation inseeking their counsel on the most vital issuesin the company such as devising a corporate

H. Edward Wrapp 1 9

strategy, evaluating key managers, or intro-ducing a new product.

Th e good general manager uses consultantsin more narrowly defined roles such as taxnegot ia t ions , a pension question, or a patentmatter. He refuses to permit them any majorinfluence in the mainstream issues, mainly be-cause he is unwilling to relieve his line man-agers of full responsibility for these decisions.Consultants are yet another complicating fac-tor in the world of the good general manager,but he has learned how to contain their hard-sel l tact ics .

MANAGEMENT INFORMATION SYSTEMS

I should have saved some time for man-agement information systems. They have be-come a highly visible miscarriage of modernmanagement. The professional general man-ager presses for total systems where everyshred of data is collected and analyzed andprinted on forms which engulf everyone’sdesk. The mountains of paper provide himwith a kind of assurance that everything isunder control.

The good general manager insists that onlyrelevant information be accumulated and thathis subordinates devise key indicators whichkeep them informed about significant trends.

SUMMARY

Businessmen are deluding themselves asthey listen to each other chant the litany ofmodern management achievements. If you ex-amine the individual management specialtiesone at a time, the achievements are formid-able. But the specialties do not fit togetherautomatically to move an organization for-ward. Today’s general manager is confrontedby innumerable blocks, some of them createdby his own subordinates, others by consul-tants, legislators, environmentalists, and con-sumerists. Either business leaders do not rec-

20 Selected Paper No. 53

ognize the indispensable function of theirgeneral managers or they prefer to ignoretheir managers’ accelerating inability to pull itall together.

Staff people should not be exasperated bymy preoccupation with the general manager.Rather they should think hard about howthey can make themselves more effective sup-porters of the general manager.

How many thousands of specialists areworking away in their cubicles on projects noone with clout cares about? In fact, howmany general managers are hoping that thespecialists never complete their projects be-cause they are almost certain to come up withgrandiose recommendations which the man-agers can’t possibly implement ?

Boards of directors don’t know how to se-lect chief executive officers and chief executiveofficers don’t know how to pick division man-agers. They promote a successful functionalmanager to general management and hopethat he works out. If he doesn’t, he usuallymust leave and his years of experience are lostto the company. The turnover of generalmanagers in some companies is little short ofcriminal.

The conglomerate binge of the early seven-ties was partly inspired by the professionalmanager who believed that he could manageany kind of business. As he acquired com-panies with a record of good management, heusually could not resist the urge to replacethe existing managers with professional man-agers. The pattern was for earnings to im-prove in the short-term, while in fact the ele-ments which make for long-term strengthswere being dissipated. How often, after theprofessional managers have decimated thecompany, is it announced that the business isbeing sold because it does not fit into com-pany s t r a t egy ?

H. Edward Wrapp 21

Years ago, the paternalism of the owner-manager could lead to abuses, and some sayit is dead and unacceptable to today’s profes-sional manager. But which is more paternal-istic? Today’s professional general managerwho plans everything in detail and instructshis subordinate exactly what to do (becausehe knows better) or the manager who thinksof a subordinate as a whole person and looksafter all of his needs? The good general man-ager has borrowed many of the practices ofthe paternalist while avoiding the abuses ofcoercion and intrusion. Some of the best oftoday’s general managers foster a working en-vironment which is very close to that of thepaternalist.

A critic of this paper will insist that one ofmy good general managers can only managea comparatively small organization, that as anorganization grows larger it must be managedin the mode of the professional. This is aweak justification for the evils of professionalmanagement and there is ample evidence thatmy good general manager can be effective ina large organization if given half a chance.Some endangered species have more resiliencefor survival than others, and good generalmanagers don’t go under easily.

Ask a top manager how he picks personswith high potential for general management,how he grooms those candidates, and how hemeasures their performance once they are pro-moted to general management.

The answers will be scanty. The heady mod-ern management techniques of the staff spe-cialists will continue to be wasted on incon-sequential issues unless leaders recognize thesubtle developments inside their organizationswhich are undermining the ability of the gen-eral managers to keep the organization com-peti t ive.