From analyzing cross-cultural differences in managing a business to deciphering the daily lives of CEOs, many books in our beloved Canaccord Learning Commons and David Lam Management Research Library are written about the history and future as well as the pros and cons of business management. This provokes the thought: why exactly do we need management in business?
Staff Writer: Joy Xu
When a small business gains momentum and hits growth, it begins to acquire more human capital that is capable of both adding value and managing a growing team. Effective human capital is crucial for growing firms, and managerial positions are definitely appealing to professionals looking to strengthen their skillset.
While many managers devote their time and effort to effectively supervise employees, boost morale and lead a powerful team, inefficiency arises when a business hires too many managers. It can often lead to a tricky situation where managers engage in little managerial work. Ultimately, this forms a top-heavy management model that slows down decision-making processes, incurs high overhead costs, and exerts pressure on employee motivation.
Since corporate positions move in an upward direction, the abolishment of managerial positions is a risky deal for many businesses. However, there are cases in which this has been implemented successfully. In March 2015, Zappos CEO Tony Hsieh sent out an email to employees stating that“people manager” will no longer be a position within Zappos. This did not mean that employees who had these managerial positions were fired or laid off, but rather that they were offered to stay with the company under new job descriptions that better aligned with their skills, strengths and goals. Interestingly, this decision coincides with Zappos’ bold culture that has successfully revolutionized traditional ideas in modern management. Although this corporate strategy may not be the right solution to all top-heavy businesses, it is evident that businesses can consider moving towards self-management and self-organization.
So, why does all this matter to us? Many business schools are now investing in innovation, emphasizing the importance of ethics, and taking leadership to the next level. The Sauder School of Business is no exception as it constantly asks undergraduate students to think outside the box and seek differentiation in providing value – something especially important in a city as entrepreneurial as Vancouver. Businesses in the development phase might offer high-level managerial positions as an incentive to get talent on board, but these positions do not always provide value in the long run. The bottom line is that businesses with traditional structure models are dramatically changing and experimenting with new management methods, and only some will emerge as successors.