Inside every chief exec, there’s a Soviet planner | Business | The ObserverPosted: February 16, 2009 | Author: ThomasPowell | Filed under: bookmarks | Tags: economics, politics | Leave a comment »
Inside every chief exec, there’s a Soviet planner | Business | The Observer. Macroeconomic central planning failed in the Soviet Union, but every company is a management planning factory.
If work is fragmented so that people have no direct line of sight to the customer, people have to be driven by signals from above rather than below.
An example from GE that illustrates the point:
Consider that the world’s most efficient large conventionally managed corporation, GE, spends 40% – that is, $60bn – of its revenues on administration and overheads. For every direct worker there’s an indirect one to check or “manage” the work.