The New Spirit of Capitalism

Appendices

Appendix 1

Exemplifying Several Comments with the 1990s Body of Work

The Problems that Have Been Identified

The 1990s authors’ rejection of hierarchy is especially noteworthy given that their readers are essentially comprised of managers from large corporations—professionals who despite all of their efforts will find it difficult to avoid working within the strictures of a hierarchical framework. The explanations that are used to highlight this anti-hierarchical bias are often moral in nature, and should be analysed as part of a more widespread rejection of domination-driven relationships (see Extract 1). They are also scrutinised in light of another irresistible societal trend, which is that people not only do not want to take orders anymore, but they do not even want to give them (2). For other authors, a general raising in the standard of education explains why hierarchy has become an outdated organisational model (3). And whilst hierarchy is a favourite target for many critics, others also attack planning (denounced for its excessive rigidity) as well as all of the categories that are generally associated with the wielding of authority (bosses, chiefs, superiors, orders, etc.).

Competition was another recurring theme during the 1990s, as was the unending and increasingly rapid change in technology (already a subject of discussion during the 1960s). This latter topic reached unprecedented levels, with the vast majority of texts giving advice on how to set up the sort of flexible and inventive organisation that is able to “surf” all “waves,” i.e., adapt to all transformations. In the 1960s, the main goal was the loosening of bureaucratic restraints, and observers at the time kept well away from aiming their criticism at the fundamental principles of organisation (e.g., Fayol’s often used concept of unique reporting line etc.). In the 1990s, however, with the subversion of the hierarchical principle, there was something of a “big bang”—an expression coined by Peter Drucker, the seasoned guru, who after having been a particularly influential proponent of management by objectives during the 1960s, now foresaw the existence of “upside down” organisations. Another major figure in management literature, Rosabeth Moss Kanter, has also explained that there will necessarily be a time in the future “when the giants learn to dance”—this having been the title of her best-seller (Moss Kanter, 1992).

Extracts:

• 1. The organisational and the pyramidal hierarchies ... indicate who knows how to manage, who is able to manage, and who has to be the one who is going to manage, as opposed to those who don’t know how to manage or who are incapable of doing so. Even with the best will in the world, the only kind of interpersonal relationship that can occur in conditions such as these is the sort of relationship that exists between a person who expresses scorn and a person who is a target of scorn. This is because “those who do not know how to manage, and/or are incapable of doing so” find themselves from the very beginning in a position of de facto inferiority—as if they have been turned into children... (Aktouf, 1989).

• 2. Along with increased individualism, the irresistible move towards freedom of choice in all areas has generated greater demands and opportunities for personal autonomy. The era of staff sergeants is over. Not only do subordinates no longer accept authority, but hierarchical superiors are themselves less and less capable of wielding it—even though more and more discipline is needed to respond to the demands of a complex environmental (Crozier, 1989).

• 3. Given that modern organisations are comprised of “erudite” specialists, they have to be an association between equals, colleagues, associates... No particular type of knowledge dominates. Everyone is judged according to his/her contribution to the common good and not in light of the allegedly inherent superiority of the function that s/he fulfils. The result is that a modern organisation cannot be an association of bosses and subordinates—it has to be an organised team (Drucker, 1993).⁵

The solutions

The systems that the 1990s authors have offered for coping with the issues that they have identified form a vast potpourri of managerial innovations. Nevertheless, we can try to organise these ideas around a few key ideas: lean companies that work in networks involving a wide range of actors; team-based or project-oriented work organisation, geared towards customer satisfaction; and workers’ overall enthusiasm thanks to the vision of their leaders.

Lean, “light” and “fat-free” firms have got rid of most of their hierarchical echelons. They only maintain between three and five levels, and have fired entire hierarchical strata. They have also separated from a large number of functions and tasks, and subcontract everything that is not part of their core business, sometimes to former employees turned entrepreneurs (N.T.: in a process called essaimage in the French, literally the workings of a beehive). Firms’ investments are increasingly made in collaboration with other companies via “alliances” and “joint ventures”; and the stereotype of the modern company has become that of a slim-lined core, which is surrounded by a potpourri of suppliers, subcontractors, service providers, temporary personnel (this allows staff numbers to adjust to levels of activity), friendly firms, etc. Such constellations are said to be working in “networks.”

We are told that the workers themselves must be organised into small multidisciplinary teams (deemed to be more competent, flexible, inventive, and autonomous than the specialised departments which had been the hallmark of the 1960s); that the real boss of these teams is the customer; and that the person who is actually running them is more of a co-ordinator than a chief (cf. Extract 4). Moreover, such teams are not solely comprised of a firm’s permanent staff members. They can also include suppliers, customers, consultants, and outside experts. Plus, the members of the team do not all necessarily have to work in close physical proximity to one another—improvements in telecommunications having made it possible to collaborate from remote locations. Once again, this is said to be an example of working in a “network.” The company’s borders blur or fade away, and the organisation itself seems to be made of little more than an accumulation of more or less durable contractual relationships. Teams become a forum for self-organisation and self-control.

These new systems have lead to the weakening of the hierarchical principle. Organisations have become flexible, innovative, and highly competent. Network organisations have made it possible to get rid of costly hierarchies—structures whose only purpose had been to serve as a “relay” for senior management, and which had therefore provided no “added value” for the customer.

Extracts:

• 4. Process teams, whether comprised of one or several individuals, don’t need bosses. Instead, they need coaches ... Traditional bosses define and distribute the workload. Now teams take care of this themselves. Traditional bosses supervise, oversee, control, and verify the workflow as it progresses from one workstation to the next. Now teams take care of this themselves. There is little room for traditional bosses in a reconfigured environment (Champy and Hammer, 1993).

The thorny problem remains of how a firm’s overall direction is to be managed—an issue with which the authors in our sample are still grappling. The existence of networks does not mean that firms no longer exist as separate entities, i.e., that they have been diluted by the network(s) within which they work. A firm’s senior managers will still devise the competition strategies that allow it to do battle with other multinationals (on those markets where they do not collaborate). Moreover, the self-organised and creative individuals who are henceforth responsible for a firm’s performance still need to be directed. This direction will be the work of few persons—managers who in any event should be distinguished from earlier, “hierarchical chiefs” Now we have leaders with vision (c.f., Extracts 5, 6). Thanks to a shared sense-making in which all participate (the aforementioned “vision”), everyone knows what s/he has to do without being ordered to do so. A strong management direction is clearly felt without there being any need to issue orders, and personnel can continue to be self-organising.

The 1990s authors write in terms of “managers” as opposed to cadres, highlighting those human qualities that have adapted best to capitalism’s current requirements, and to the environment of “uncertainty” and “complexity” that firms have been plunged into. Managers are neither seeking to command, nor to order people around, and employees are not waiting for orders before acting. Everyone has understood that such roles are out of date. Managers have become “team leaders,” “catalysts,” “visionaries,” “coaches,” and “drivers.” The “driver” (N.T.: donneur de souffle in the French, literally “the person who provides the breath”) is a character that was invented by Hervé Sérieyx. Like other 1990s authors who lacked the appropriate vocabulary to describe the new corporate hero, Sérieyx was forced to make up his own expressions. Rosabeth Moss Kanter talks about “corporate athletes,” Meryem Le Saget about “intuitive managers” and Lionel Bellenger about “pros” (7). Other terms such as coach, team leader, or “midwife” are used by several different authors.

Extracts:

• 5. Vision, a commodity that creates enthusiasm, is not just a mission—it is also a powerful magnet. Like all great challenges, vision awakens collective capacities (Crozier and Sérieyx, 1994).

• 6. The leader is a person who has been given this role by the group—the person with whom each individual in the group consciously or subconsciously identifies. Thanks to his/her influence, visionary artistry and orientations, the leader creates a current that spurs people into transcending themselves; into trusting others; and into showing initiative (Cruellas, 1993).

• 7. We don’t even possess an appropriate vocabulary for discussing these new types of relationships. The terms “superiors” and “subordinates” hardly seem precise enough. Even words like “boss” and “employees” imply concepts of control and/or rights which managers do not always actually have (Kanter and Moss, 1991).

With the decline in nearby hierarchical control, there have been increasing references in management (and indeed in micro-economic) literature to the idea of trust. Trust is that which unites team members amongst themselves: a firm with its leader; a coach with the person s/he is helping; or partners within an alliance. Trust presupposes self-control—it focuses on the existence of secure relationships in situations that are otherwise based on nothing more concrete than words and/or moral contracts. Indeed, trust possesses a moral dimension, whereas control by a third party is little more than the expression of a relationship that is based on the domination of one party by another (8).

Extract:

• 8. The balance of power is no longer a salient issue when the main objective is the creation of a sense of belonging, a feeling of satisfaction with and trust in one another (Aktouf, 1989).

What is Being Rejected

To promote these new organisational forms, the 1990s authors (like their 1960s predecessors) also criticised and delegitimised those contemporary aspects of organisations that they deemed to be obsolete in efficiency terms, and outdated from a human relations perspective. However, this time around criticisms no longer target arrangements that could once have been accused of transposing the domestic world in the work world. Instead, they target a type of organisation that had been praised during the previous era for its clear-cut separation between private family life or personal relationships, on one hand, and professional and/or work relationships, on the other. During the 1960s, this separation was supposed to ensure that competency was the only criterion for professional success, and certain authors worried about the breakdown between the amount of time that people spent resting and/or with their family against the amount of time they spent working. During the 1990s, management authors rebelled against this separation, considering it to have a mutilating effect insofar as it separates aspects of a person’s life that should not be dissociated from one another; inhuman because it leaves no room for a person’s emotional makeup; and inefficient because it hampers flexibility and inhibits the multiple competencies that need to be implemented in order to learn to “live in a network” (9, 10).

To describe the large impersonal organisations that had been inherited from the preceding period, 1990s managers appropriated a term of Weberian sociology that had been particularly popular between 1940 and 1960 due to that era’s Trotskyist criticisms of State apparatuses in totalitarian regimes: bureaucracy, with its connotations of authoritarianism and arbitrariness, the blind and impersonal violence of cold-hearted monsters, inefficiency, and resource wasting. Not only were bureaucrats inhuman, but they were also unprofitable. The goal of the battle that was waged during the 1990s became the wholesale elimination of a business model that had been forged during the preceding era. This involved both the delegitimisation of hierarchy, planning, formal authority, Taylorism, “managerial [cadre]” status, lifelong careers with one and the same firm, etc., as well as the reintroduction of criteria such as individual personality and personal contacts—factors that had fallen by the wayside over time. This was not an attempt to return to the initial spirit of capitalism: firms are bigger than ever; managers are professionals and not small owners; and the work world nowadays involves a network approach rather than a domestic framework.

Extracts:

• 9. Professional life is the perfect embodiment of rationality. It is very different from people’s private lives, this being an area of subjectivity, of search for meaning and expression of personal values. These two existences are hermetically sealed from one another ... Whenever personal elements are incorporated into business-related judgements, there is the feeling that one’s private life is running the risk of being infringed upon by the firm. Yet nowadays it is clear that this sort of outlook ... has become totally obsolete. Developing a vision of a company’s future, devising strategies, motivating work groups, creating networks of relationships—all of these actions call upon qualities that go well beyond simple technical competency. They mobilise a person’s complete personality (Landier, 1991).

• 10. The demands that are being made of us require that we abandon this split between our professional and our private beings, between our rational and intuitive selves, between that which is natural and that which is manmade, between the brain and the heart (Sérieyx, 1993).

(Job) Security Through Employability

Simply asking which (job) security assurances feature in modern management texts creates an initial difficulty for us. Security was not a dominant value during the 1990s. At the time, this factor was associated with commonly denounced evils such as status, hierarchy, and bureaucracy. This was very different from that which had been observed during the preceding era.

The most pugnacious author on this topic has turned out to be Bob Aubrey, who likes to remind his readers that Maslow’s pyramid is a false scientific law (11). Notwithstanding this allegation, management authors also know that few people will feel attracted by their proposals if they don’t offer any new forms of security. They are aware of the need to propose something that can replace the hierarchical careers that had been such an integral part of the second spirit of capitalism. One suggestion has been that this format should be replaced by the idea of a succession of projects. In this conception, people no longer develop careers, rather they move from one project to another, with their success on a given project being that which enables them to accede to another, more interesting one. Each project is an opportunity to make many new acquaintances, and it therefore offers people the chance to earn a solid reputation and to be co-opted into a new activity. Moreover, given that each project, by definition, is different, new and innovative in nature, it can be presented as an opportunity for learning and for adding to one’s own competencies—this being an advantage in finding other engagements (12, 13).

The key concept in this view of working life is employability. This notion is supposed to describe the ability that people must possess if they want to be asked to participate in a given project. The transition from one project to another is an opportunity to enhance one’s employability. This is a personal capital that each individual has to manage in his/her own way. It is the sum total of a person’s usable competencies. A firm will be seen as offering a certain form of security when it develops rather than destroys its employees’ employability at those times that it is unable to avoid either dismissing people or else when it cannot offer them a promotion (14). As such, the 1990s authors do offer several solutions for job security-related problems, even though their proposals lack an instrumentation that is comparable to that which had been on offer in 1960s writings on managing executive workforces—literature that had provided many details on the best ways to recruit and evaluate people, or on how to help them to develop. In the texts we read, there were hardly any systems for assessing employability, for verifying whether it is on the rise or else deteriorating, etc. One optimistic explanation for this would be that the texts from the 1960s involve a relatively late formulation of the second spirit of capitalism. This was an era during which the then current spirit had already been in place for quite some time. The 1990s texts on the other hand are associated with a brand new spirit of capitalism, one that is just emerging, and which has not yet reached the height of its motivational powers.

Extracts:

• 11. Organisations nowadays have to assimilate a new reality, and treat each employee as if s/he were a firm. This change means that some of the suppositions that had dominated industrial society have to be abandoned, first and foremost, the idea that people are looking for job security. This is a 1950s concept born out of Abraham Maslow’s famous “pyramid of needs,” with its postulate that fundamental needs must be satisfied before we can even begin to consider other types of fulfillment. Now, not only is this thesis problematic from a theoretical perspective (how does it explain the fact that some people risk their [material] security to become artists or to start a new career?), but there is little justification for the way in which it has been interpreted in management circles, i.e., the firm’s first responsibility is to create a secure environment, with fulfillment only coming at a later stage (Aubrey, 1994).

• 12. The post-industrial career is an unending sprint from one project to the next. The measure of success of a given project is the value that it adds ... Each person depends much more on his/her own resources rather that on the destiny of whatever company happens to be the titular employer at the time. Those who are not conversant in the art of climbing the hierarchical ladder tend to fall by the wayside ... Everyone has to create a personal portfolio of aptitudes, as firms no longer guarantee job security. And there is every chance that entire populations will learn new competencies during this process (Moss Kanter, 1992).

• 13. If the organisation of the future only features a few hierarchical levels (i.e., three or four instead of a dozen), there will be fewer echelons that candidates will have to succeed at before reaching a relatively senior position. Career development will entail more lateral and less vertical movement. With people accepting new areas of activity or other types of responsibilities, the focus will be more on learning and on broadening one’s own experience than on acceding to a higher rank. In addition, this type of development will not automatically lead to increased remuneration. The times have changed, and so have the rules of the game. The career paths that people will be following are no longer clearly signposted. As a result, successful career management in this brave new world infers that people become actors in their own development, taking charge of their own future. No one else is going to be doing it for them (Le Saget, 1994).

• 14. Job security cannot be guaranteed. On the other hand, firms can guarantee “employability,” that is, a level of competency and flexibility that will enable each individual to find a new job within his/her firm or outside of it (Aubrey, 1993).

Appendix 2

Articles and Books Which Have Provided the Extracts of the 1990s Body of Work

Texts Which Original Language is French

Articles

Adam Edmond, 1993, “Le Coaching Ou Le Retour Vers La Personne,” Management France, no. 86, Nov, pp. 12–14

Arpin Roland, 1994, “ Diriger Sans S’excuser ,” Revue Internationale De Gestion, vol. 19, mai, no. 2, pp. 55–61

Aubrey Bob, 1993, “Repensons Le Travail Du Cadre,” Harvard-l’Expansion, Août, pp. 56–64

Aubrey Bob, 1994, “ La Métamorphose Du Travail Conduit À L’entreprise De Soi,” (présentation de son livre “Le Travail Après La Crise”), Management France, Fev, no. 87 pp. 22–23

Baron Xavier, 1993, “Les Enjeux De Gestion Des Salariés Travaillant Dans Les Structures Par Projets,” Gestion 2000, no. 2, pp. 201–213

Desclée de Maredsous Xavier, 1992, “ L’exercice Du Leadership Ou La Gestion De Sa Carrière Au Jour Le Jour,” Gestion 2000, vol. 7 numéro spécial: “gérer votre carrière,” pp. 105–126

Gastaldi Dino, 1990, “ Le Métier De Cadre : Évolution Et Prise En Compte Du Management,” Direction et Gestion, no. 126–127, pp. 57–62

Girard Bernard, 1994, “ Vers Un Nouveau Pacte Social ,” Revue Française De Gestion, no. 100, sept, pp. 78–88

Lemaire Bruno, 1994, “Des Entreprises Sans Hiérarchie?,” L’Expansion Management Review, automne, pp. 74–82

Midler Christophe, 1993, “La Révolution De La Twingo,” Gérer Et Comprendre, Juin, pp. 28–36 Mai

Morin Pierre, 1994, “La Fin Du Management Romantique,” Management France, no. 88, pp. 14–17

Raux Jean-François, 1994, “Management Et Mutations,” Futuribles, no. 187, Mai, pp. 9–26

Serieyx Hervé, 1993, “ A Propos Du Big Bang Des Organisations ,” Management France, no. 85, pp. 29–30

Strebel Paul, 1994, “Comment Faire Évoluer Les Règles Du Jeu,” L’Expansion Management Review, Eté, pp. 17–21

Weiss Dimitri, 1994, “Nouvelles Formes D’entreprise Et Relations De Travail,” Revue Française De Gestion, no. 98, Mars–Avril–Mai, pp. 95–103

Books

Aktouf Omar, 1989, Le Management, Entre Tradition Et Renouvellement, Montréal, Gaëtan Morin

Archier Georges, Elissalt Olivier, Setton Alain, 1989, Mobiliser Pour Réussir, Paris, Seuil

Aubrey Bob, 1990, Savoir Faire Savoir (Prix Dauphine 1990), Paris, InterEditions

Aubrey Bob, 1994, Le Travail Après La Crise, Paris, InterEditions

Bellenger Lionel, 1992, Etre Pro, Paris, ESF

Bonis Jean, 1990, Le Management Comme Direction D’acteurs: Maîtriser La Dynamique Humaine De L’entreprise, Paris, CLET

Crozier Michel, 1989, L’entreprise À L’écoute. Apprendre Le Management Post-industriel, Paris, InterEditions

Crozier Michel et Sérieyx Hervé Eds, 1994, Du Management Panique À L’entreprise Du XXIème Siècle, Paris, Maxima

Cruellas Philippe, 1993, Coaching: Un Nouveau Style De Management, Paris, ESF

Doyon Christian, 1991, L’intrapreneurship: La Nouvelle Génération De Managers, Montréal, Agence d’Arc

Ettighoffer Denis, 1992, L’entreprise Virtuelle Ou Les Nouveaux Modes De Travail, Paris, Odile Jacob

Genelot Dominique, 1992, Manager Dans La Complexité, Paris, INSEP

Hec (Les professeurs du Groupe), 1994, “Management Et Ressources Humaines: Quelles Stratégies De Formation,” L’école Des Managers De Demain, Paris, Economica pp. 245–268

Landier Hubert,1991, Vers L’entreprise Intelligente, Paris, Calmann Lévy

Lenhardt Vincent, 1992, Les Responsables Porteurs De Sens: Culture Et Pratique Du Coaching Et Du Team Building, Paris, INSEP

Le Saget Meryem, 1992, Le Manager Intuitif, Paris, Dunod (Prix dauphine 1993)

Le Saget Meryem, 1994, 10 Conseils Pour Le Manager De Demain, Brochure Du Cabinet De Conseil Erasme international, 28 pages

Mingotaud F., 1993, La Fonction D’encadrement, Paris, Editions d’Organisation

Moran R., Xardel, D., 1994, Au-delà Des Cultures: Les Enjeux Du Management International, Paris, InterEditions

Orgogozo Isabelle, 1991, Les Paradoxes Du Management, Du Château Fort Aux Cloisons Mobiles, Paris, Editions d’Organisation

Orgogozo Isabelle, Serieyx Hervé, 1989, Changer Le Changement, On Peut Abolir Les Bureaucraties, Paris, Seuil

Ramond Philippe, 1993, Le Management Opérationnel, Paris, Maxima

Renaud-Coulon Annick, 1994, L’entreprise Sur Mesure, Paris, L’Harmattan

Serieyx Hervé, 1993, Le Big-Bang Des Organisations, Paris, Calmann Lévy

Sicard Claude, 1994, Le Manager Stratège, Paris, Dunod

Tarideu Michel, 1994, Patrons-cadres: La Crise De Confiance, Cahiers De L’institut De L’entreprise, Avril, pp. 20–26

Vermot Gaud Claude, 1993, Mobiliser Pour Gagner, Paris, Editions Liaisons

Vincent Claude-Pierre, 1990, Des Systèmes Et Des Hommes, Paris, Editions d’Organisation

Translated from English (US)

Articles

Drucker Peter, 1993, “Le Big-bang Des Organisations,” Harvard-L’Expansion, no. 69, Eté, pp. 35–42

Moss Kanter Rosabeth,1991, “Les Habits Neufs Du Manager,” Harvard-l’Expansion, no. 60, printemps, pp. 30–39

Books

Hammer Michael, Champy James, 1993, Le Reengineering, Paris, Dunod

Moss Kanter Rosabeth, 1992, L’entreprise En Éveil, Paris, InterEditions

Peters Tom, 1993, L’entreprise Libérée, Paris, Dunod

Quinn Mills D., 1994, L’entreprise Post-hiérarchique, Paris, InterEditions

Tapscott Don, Castom Art, 1994, L’entreprise De La Deuxième Ère. La Révolution Des Technologies De L’information, Paris, Dunod

Toffler Alvin, 1991, Les Nouveaux Pouvoirs, Paris, Livre de Poche

Waterman Robert, 1990, Les Champions Du Renouveau, Paris, InterEditions