Five Most Overrated Management Concepts/Steps

Making a company successful requires, above all, clear thinking and decisive action. Unfortunately, many management concepts or steps encourage fuzzy ideas and bad decisions. My favourite five are:

(i)        Synergy

           This is usually used in justifying a merger or takeover. In many cases it is not true – the acquisition is disruptive, counter-productive and destroys value, at least in the initial years.

(ii)       Voluntary or Mutual Separation Scheme (VSS or MSS)

This is retrenchment period. Companies may couch their words but it is a lay-off. A VSS invites employees to make an offer while in a MSS, the employer achieves the same result by selecting employees they want to lay-off.

(iii)      Rightsizing/Downsizing

          There is no such thing! Management was responsible for the “wrong” size in the first place. They use (ii) above to “right size”. Lousy management leads to big lay-offs, i.e. management failed!

(iv)      Consensus

         Only political parties and civil service should be allowed to use this jargon. It sounds reasonable. But “wisdom” of committees in practice drives weak decisions. Consensus favours conservative, safe and bland decisions. Then you will not have the likes of Amazon, Tesla or Alibaba.

(v)       Brainstorming

        Getting people together to bounce ideas off sounds great but it doesn’t work. Group think and dominant personalities will drive the agenda. Creativity is not a group process and great ideas do not emerge from half-baked ones. Otherwise, we will not need Edison, Ford, Galileo or Elon Musk!