In my last blog, I described the best form of company management, which that of “benevolent dictatorship.” I will now discuss a case study of an alternative form of management, and how it went awry.
It may surprise you to know that there are enterprises that offer consulting in the implementation of alternative forms of management. These are “for profit” organizations charging $300+ per hour. The fees for initial implementation for small-mid cap companies can range from $200,000 to $500,000. Ongoing consulting can easily double these figures.
The system that I witnessed first hand was an alternative form of management that claimed to be quasi-democratic and “holistic.” Despite its lofty appeal, it was a monumental disaster. The fact is, simple deductive reasoning could have easily shown that the system was fundamentally flawed and doomed from the onset.
What was the flaw? The system did not allow the company to get full the benefit from its expert employees. Additionally, important decisions took too long, and were made by people who were not qualified to make such decisions. Petty political motivation became the key driver, and the result was circus of mediocrity. Think of Lord of the Flies, or giving the keys to your car to a group of eight-year olds.
For example, can you imagine your warehouseman making decisions on the routing of phone calls to sales personnel? Or your management consultant making decisions on how to terminate an employee over the objections of legal counsel? Or your accounting clerk making ultimate decisions on proper accounting treatment over the objections of the CFO? As ridiculous as this sounds, all of this and more actually happened. Within 18 months, this company laid off half it’s staff, and its status as a going concern is now questionable.
If you are ever tempted to experiment with an alternative form of management that deviates from benevolent dictatorship, do not do it.