Managerialism – the ideology hiding in plain sight

Posted by in Articles, Blog on Mar 31, 2015

James Burnham’s book The Managerial Revolution was first published in 1941. As an analysis of trends in the governance of companies, corporations and states, it remains an interesting document. It is true that George Orwell’s closely argued critique of the book six years later, showed that some of Burnham’s prophecies concerning Nazi Germany, the Soviet Union and Japan were plain wrong. Nevertheless, The Managerial Revolution was one of the primary inspirations for his book 1984. As an analysis of organizational structures it remains more relevant than ever today. Burnham as a prophet was wrong, but his analysis was highly percipient. Managerialism is an ideology that has since pervaded our culture to an astonishing extent.

Government, business and corporate systems in the West appear on the face of it to be following the well-trodden path of old-fashioned capitalism. In old style capitalism though, the individual still had considerable importance. Indeed, it was thought of as the system whereby the energetic individual could thrust his way into the market place and prosper, as long as he had something that people wanted. Managerialism removes the importance of the individual. Instead the interactions of various organizations are of primary importance, and how their transactions can benefit each other. The individual only has a voice in such relationships through the organization – if any – to which he or she belongs. The organization is the fundamental social unit in this ideology, not the individual.

As a political ideology, the managerialist model demands that each department in a given structure must excel. The ‘mission’ is identified and the goals by which to attain the mission are identified. These goals are then handed down to management structures further down the hierarchy, whose task is to assess problems ‘rationally’, identify and cost options, consider what the outcome of following this or that option might be and choose the best, most cost-effective means of reaching the given goal. This so-called ‘rational approach’ is meant to avoid conflict and argument.

However, the imposition of “performance indicators” to test managers’ efficiency, and use of  “market testing” to compare, say, public and private sector success leads all too readily to the creation of a culture of bullying, that has come to light recently in, for instance, Hull and East Yorkshire Hospital, and the Alexandra Hospital in Worcestershire. Managers forced to make decisions that maximise profitability will have to impose their will on their subordinates. But in, say, the National Health Service, notions of profit and efficiency can become hopelessly confused. Similarly in schools, the importance of the individual student or pupil can be subordinated to ideas of institutional success based on, say, exam results or university entrance. Where there was once an ethos of public service, or education as an ideal in itself, there is now an atmosphere derived from the managerialist ideology that puts the organization first and the individual nowhere in particular. When the individual loses importance, that quality central to harmonious human working, trust, is eliminated from the workplace.

While the individual is side-lined in the managerialist model, the big business giants present themselves through their advertising and public relations exercises as warm, friendly organizations, interested in the comfort and well being of their customers. Train passengers become ‘customers’, as if to remind travellers that ‘the customer is always right’. Recorded voices on business switchboards try to emphasise how important a customer’s call is, as they wait holding a telephone, listening – whether they want to or not – to recorded music. But as businesses and corporations endeavour to show a human side, US law recognizes corporations as ‘persons’ with the same rights as the individual. This might appear to bring corporations down to the level of the ordinary person in the street or court of law, but in fact has the effect of taking power away from single individuals, who have nothing like the resources to call upon as a corporation, in matters, say, of litigation.

Central to the managerialist approach is the notion that management skills are not specific to any particular situation. They are completely transferable, whether the organization is a school, a hospital, an industry, a residential care home or the local sweet shop. What is important to the managerialist ideology is the most efficient optimization of profits. The MBA degree should give one access to any organization that wishes to prosper in the marketplace, no matter what function that organization is supposed to perform. And the ‘marketplace’ has been expanded like elastic to include virtually all aspects of human endeavour, whether in the marketplace or not.

There is already, within managerialism though, a tension between the point of view that the structure of how things are run in a given situation relies on the one hand on the willing acceptance of those working within the management structure at lower levels of power, and on the other hand those who feel that their own individualities and needs should be recognized. The political economist and sociologist Max Weber’s phrase ‘legitimate domination’ here describes very clearly the relationship between those who find themselves working at the lower echelons of the business, hospital, care home or whatever it might be. A nurse, say, or a shop-floor worker in a factory agree, within the managerialist model, to be ‘dominated’ legitimately as part of their employment contract, whether they are aware of this or not, or even whether it is ever made clear within the articles of their employment.

Another of Weber’s phrases, ‘legal-rational’, describing the approach of higher management, is also most telling. It implies straight away that the top managers are rational people with the law on their side. Those who willingly submit to the management structure must also accept that they are part of an organization run according to an ideology that prizes efficiency above all – and that ‘efficiency’ here means profitability and success in the market. That ‘market’ would include hospitals and care homes as much as it would, say, baked bean factories or heavy industry. The feeling arises that there is an elite tribe of managers, elevated above the common ruck of people, giving orders to a lesser tribe, those working at lower levels within the managerialist hierarchy. Once again, the tendency is against the individual and in favour of the organization, and trust is flushed out of the system. (Consider, too, from a human perspective, the relationship between technology and ‘efficiency’.)

What chance does an individual have in a workplace that embraces such an ideology? Another telling phrase from Weber appears here: ‘technology of self’. Basically this means knowing how to make one’s voice heard within the organization in a meaningful and effective way. Staff in Nurseries, Day-Care centres and schools, NHS hospitals and caring communities, to name a few instances, need to know how to develop such technologies of the self if they find that the ethos that they imagined they were choosing to work within is taken over by the managerialist ideology, and a damaging confusion of aims destroys their relationship to their chosen vocation. Of course efficiency is a necessary part of any organization’s functioning, but the managerialist ideology, when it is embraced in places outwith its appropriate setting actually works against efficiency. If workers feel bullied, or if institutions are clear that their founding ethos has been compromised, efficiency disappears, along with trust.

It is important to be clear about where the techniques, practices and strategies of managerialism belong, and where they do not. Schools, caring communities and hospitals need to be aware of the structures of governance that best suit their ideals. An ideology that interferes with working with such ideals needs to be recognized. Its name, once again, is managerialism.

There is an alternative model of working together within an institution. Rudolf Steiner called it ‘republican working’. It has been the normal practice for almost a century within Waldorf schools, and other institutions based on Steiner’s insights. Ideally, it is consensual and non-hierarchical. To oversimplify, it is a model in which a dedicated group of people can try together to allow new intuitions to become the foundation of right action.

It is not always easy to reach decisions through consensus in this way. It requires a great deal of faith in the process, not to mention a high degree of self-knowledge and generosity of spirit among the participants. New intuitions can seem to go directly against those ways of working that we are used to. We can be pushed out of our comfortable habits.

Difficult though this model may be to understand, and, often, to work with, it has enormous potential for those willing to recognize sources of inspiration that lie outwith more usual techniques of problem solving or finding creative impulses. It can be very tempting, though, to embrace a system in which someone mandated to a position of particular responsibility makes the vital decisions, which others must then like or lump. Attractive as it may be to allow another person or small group to make difficult decisions, I believe that it can allow a different ideology to enter and gradually replace a more demanding but ultimately more human, flexible and inspirational way of working together.

Another problem that arises with this ‘republican working’ is that those outside the process don’t know who to get in touch with when problems arise; they want to know who is ‘accountable’. It doesn’t fit the idea of institutional structures that, for instance, the MBA degree has taught one to understand. The managerialist model is easier to understand. This model arises out of an ideology that can bring with it some unpleasant effects. These occur most obviously when managerialist strategies and practices are brought into places where they have no right to be. I don’t mean to suggest that business and industry could take up republican working, but I do mean to cast serious doubt on replacing that kind of consensus working with managerialist structures where, by its very nature, it doesn’t belong.