Creating Creation Companies

Episode #1 of the course “Creating creation companies” by Barry Mapp

This course is intended to challenge your view about business leadership.

Today’s challenge for any leader is to be able to recognize and realize the full potential of an organization, whether this be a corporation, an SME, or a micro-business.

If we lead our organizations in the same way we have in the past, we are likely to get the same sort of results. The major scandals over the last 15 years are just the tip of the iceberg (consider, for example, the Enron Scandal (2001), WorldCom Scandal (2002), Tyco Scandal (2002), HealthSouth Scandal (2003), Freddie Mac Scandal (2003), American International Group (AIG) Scandal (2005), Lehman Brothers Scandal (2008), Bernie Madoff Scandal (2008), and much of the banking sector in the financial collapse of 2008). The most recent management scandal is the Volkswagen Emissions Scandal, but there are many more.

There have been many calls to lead and manage organizations in totally different ways—i.e., on the need to transform “western management.” Such a call was probably first issued by W. Edwards Deming. While some organizations have cherry-picked Deming’s best ideas (Ford in America was one example), very few organizations have attempted to transform the management of their business wholly along the lines that Deming proposed.

So most organizations continue to be run in the old way based on “old psychology,” “old science,” and “old management” principles. As management guru Russell Ackoff pointed out, most business schools are part of the problem, because they (still) teach “old way” approaches. The majority of today’s leaders (and those who have been enticed to work in academia) were themselves mentored by leaders of the old paradigm—the paradigm of “command and control.” It is hard to escape this leadership style’s historic influence and dominance.

However, there has been growing support for transforming management thinking. Tom McGehee is one example of the many who have called for a change in our thinking. He has referred to a transformed organization as a “creation company,” while an old-style organization is a “compliance company.” For convenience, I will use these terms in this short course.

Compliance companies (perhaps unwittingly) erect barriers to change and innovation by insisting on control of information, resources, and decision-making. In these organizations, employees are not trusted to supervise themselves or inspect their own work. The consequence of this is that people are often unable give their best efforts, because the management systems get in the way. In this type of system, managers spend much of their time “working on the people” in order to get them to do the work. In creation companies, managers learn that their job is to work on and improve the work systems. Good work systems enable staff to do their best and undertake their work to a high standard without management impediment.

Two separate but important questions will be addressed in this course. The first part of the course looks at what leaders need to do in order to transform a business. The second part focuses on the individual in the workplace and looks at the circumstances that help people develop and express creativity.

Recommended book

“Whoosh : Business in the Fast Lane” by Tom McGehee

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