Liberation Management, or Management by Stress?

"Ye shall no more give the people straw to make brick, as heretofore: let them go and gather straw for themselves. And the tale of the bricks, which they did make heretofore, ye shall lay upon them; ye shall not diminish ought thereof...."

From my first reading of Tom Peters' work, my overwhelming impression was of the ambivalent or dialectical character of the "revolutionary" management and organizational trends he championed. Depending on the system of power into which such ideas are incorporated, they could make life either heaven or hell for those doing the actual work.

The same generalization applies to many other organizational and management theory trends (reengineering, lean production, kaizen, and the like), all of which celebrate the dissolution of corporate hierarchies and the organization of production along decentralized, consumer-driven, and (allegedly) bottom-up lines. And indeed, a lot of it sounds like what might be the seeds of a libertarian, self-managed, decentralized economy, if the structural bulwarks to authoritarianism were removed. The same practices, however, when integrated into the existing system of state capitalism, become what Mike Parker and Jane Slaughter [Working Smart: A Union Guide to Participation Programs and Reengineering (Detroit: Labor Notes, 1994)] call "management-by-stress."

The striking thing is that ideas like demand-pull, self-directed teams, and flexible manufacturing are discussed both by corporate management gurus like Peters, and by left-wing economic decentralists, in language that is virtually indistinguishable from one group to the other. The demand-pull concept, for example, was anticipated at least as early as Barry Stein's Size, Efficiency, and Community Enterprise. The difference is that Peters considers such ideas (despite his revolutionary rhetoric) largely in terms of their integration into the existing corporate economy, while the left-wingers imagine a post-corporate economy of producer and consumer cooperatives built around the new practices.

Reading Peters brought another, seemingly obvious, question to mind. In his work of the late '80s and early '90s, he wrote of the dissolution of corporate walls, the elimination of middle management, and the rise of worker self-management as inevitable revolutionary trends that the Fortune 500 would inevitably adopt or die. If the large corporation were not revolutionized along such lines, he wrote, it would go the way of Gosplan. Yet, fifteen or twenty years later, the corporate dinosaur is still thrashing quite vigorously in those alleged tarpits, with no sign of going under. Why didn't the old hierarchical corporation disintegrate to anywhere near the extent Peters predicted, and why isn't the flattened network of self-directed teams anwhere near as prevalent?

One partial answer is that Peters greatly exaggerated the competitive disadvantages of inefficiency in a cartelized, state capitalist market, and underestimated the inertia of the existing system. When three-quarters of a market is dominated by a handful of corporate "Gosplans" that share the same pathological organizational culture and follow the same "industry trends," Gosplan can be pretty profitable.

But another part of the answer may be that the stuff Peters talked about actually was adopted to a large extent; it's just that the contrast between the new and old ways of doing things wasn't nearly as great as he imagined, and that what's called the "self-directed team" can be integrated quite nicely into the old hierarchy without anywhere near the revolutionary upheaval he expected.

Peters himself made it clear that he wasn't opposed to bigness, as such; he just wanted to simulate the advantages of smallness in the context of a large corporation. And he also made it clear that his prescriptions for eliminating middle management, transforming the corporation into a loose network of self-directed teams, and "outsourcing everything" would take place within a mercantilist framework of corporate headquarters that retained central control of "intellectual property," branding, and finance, as well as the price-setting power that comes from coordinated buying and selling. Nike has taken the principle to its logical conclusion, outsourcing all the production to an archipelago of "independent" sweatshops, while retaining control of corporate finance and legal possession of the Nike brand-name. It's pretty hard to miss the fact that the world in which Peters saw his ideas being implemented was a world built by Tom Friedman, upheld not by the invisible hand but by the fist of the World Bank, IMF and WTO, and the U.S. armed forces.

For the left-wing economic decentralists, on the other hand, such ideas are expected to reach their full flourishing only when intellectual property, centralized finance, and corporate headquarters themselves have gone the way of T. Rex. In other words, they will become the basis of economic organization in an economy centered on decentralized production for local markets, with production organized predominantly through consumer or producer cooperatives. Peters' prescription, as it is actually being implemented, is a way to integrate the Goths into the framework of the old Roman imperial structure and give the Empire a new lease on life.

All these management trends of flexibility, decentralization, flattening of hierarchies, and related ideas, examplify what might be the seeds of a new libertarian economic system along the lines that Kirkpatrick Sale described in the economic chapters of Human Scale. But adapted to the existing corporate economy, they are more accurately described by Parker and Slaughter in Working Smart.

Many of the stated principles, as such, might be good, if they were applied by workers for themselves, in an economy of worker cooperatives. But when they are done to workers by management, they become management-by-stress.

Indeed management theory gurus, in describing kaizen, lean manufacturing, etc., use rhetoric of empowerment reminiscent of left-wing literature on worker self-management. An especially egregious example is Tom Peters. But in practice, in the corporate capitalist workplace, they translate into relentless downsizing and speedups, and a nightmare of overwork and job insecurity. As Parker and Slaughter describe it, these fashionable management practices can be broken down into several key components (they focus especially on the NUMMI joint-venture of Toyota and GM).

The first is the speedup. Lean production systematically isolates and removes all the buffers against bottlenecks, like stockpiled parts or extra workers to fill in for absentees. The system is deliberately stressed to identify not only the weak parts, but those that are too strong.

A good example is the use of the "andon board," representing every work station. The green light means the station is keeping up. Yellow means it is falling behind. Red is a problem that requires stopping the line. Under management-by-stress, all green is not good. The idea is to stress the system, removing staffing and other resources from green areas, until a satisfactory number of yellow lights indicates that the system is operating near its absolute limits. [pp. 24-28]

A second key aspect of management-by-stress is the just-in-time, or demand-pull approach to production. This is another idea that, if developed in the directions described by left-wing decentralists like Barry Stein, Dave Pollard, and Michel Bauwens, would be a good thing. But adapted to the capitalist workplace, the dark side of its dialectical nature is revealed. The idea is to reduce inventories of finished and unfinished goods to an absolute minimum. The lack of a cushion helps to stress the system, pressuring those in weak spots to superhuman efforts to catch up. Those causing bottlenecks are isolated and identified, and subjected to hellish pressure. [pp. 25-27] The peer pressure to avoid stopping the line and attracting unwanted attention from one's coworkers or supervisor is so intense that some workers, who have trouble keeping up, will come in early or use breaks to build stocks to avoid falling in the hole. [p. 29]

The removal of staffing buffers also results in peer pressure for keeping up and against absenteeism. The worker who cannot keep up with the pace of the sped-up line creates more work and stress for those down the line. And since the work group is just barely large enough to handle its work load, there is absolutely no margin for absenteeism. The team passes on its collective stress to the recalcitrant worker. The pressure is overwhelming to work through all but the most incapacitating illnesses. [p. 29] This is reminiscent, albeit to a lesser degree, of the colorful stories veterans tell about the practice of collective punishment in the military, and the "blanket parties" organized for the individuals who made a unit suffer.

In short, the system is not bufferless at all. The workers themselves are the buffers, at little or no cost to the company. [p. 69]

Glitches are inevitable, anywhere. Could a system that really had no buffers to deal with these glitches be as productive as this system is? Lean production does remove or sharply curtail those buffers that add significant cost--a stock of work-in-progress, back-up machinery, extra workers, or spare time--but it replaces these with an alternative. The real buffers in bufferless production are the workers, who are expected to put out extra effort to maintain production despite the unavoidable glitches.

If the just-in-time system makes a part shipment late and the team leader has to run to get it, that's the job. If overtime is required and workers have to forego personal plans, that's the job too. Using workers as the shock absorbers of the system costs management little (except for workers compensation claims), but it can be very unhealthy for the human element. [p. 80]

If you ever had any doubt that the term "human resources" reflects a conscious agenda, this should dispell it. They view us as another resource to be used until it falls apart, and then replaced. And Fish! Philosophy is another way to deal with problems of exhaustion and shattered morale on the cheap: to get a little more out of us before they have to replace us, without having to give us anything extra in return.

A third aspect of management-by-stress is what Parker and Slaughter call "super-Taylorism," with workers pressured to time-study themselves. [p. 27] This is what the Japanese call kaizen, or continuous improvement. Although the theory stresses the empowerment of workers who are involved in the improvement process, the only real creative role for workers is in figuring out how to get more work out of less staff; the new work process, once worker input is incorporated into it, itself becomes inflexible. The basic idea is Taylor's: identify one "best practice" and then make everyone follow it without deviation. The "super-" modifier reflects the fact that management actually saves money on time-and-motion peckerheads with clipboards, instead paying hourly wage workers to think up ways to screw themselves.

And make no mistake: kaizen always means reducing staffing, not individual effort. It's a way to get more work out of fewer people. The object is to reduce man-hours enough to eliminate an entire person. As Parker and Slaughter say, "Reducing effort is not the issue, reducing jobs is.

The original Japanese inventors of all these fads were under no illusions about "worker empowerment." For all of the American management gurus' glibness about the "end of Taylorism," so effectively lampooned by Thomas Frank, the Japanese saw their techniques as the fullfillment of Taylorism, not its negation:

The original theoreticians of the Japanese production system, such as [Yasuhiro] Monden and Taichi Ohno, saw their notion of standardized work as building on the ideas of Frederick Taylor's scientific management and Henry Ford's assembly line.... Those who implemented the production system in North America were explicit that they were following in the Taylorist tradition....

Further, a central tenet underlying all the well-known quality programs, from Deming's to Crosby's, is that quality is achieved by removing variation from the process.... This in turn requires breaking jobs down to their elemental tasks, carrying out precisely defined steps and management instructs, and extremely tight process control--i.e., Taylorism.

The difference is that the collection of worker knowledge is ongoing, through kaizen, rather than a one-time event as envisioned by Taylor in setting up the system. And workers time-study each other, instead of time-study by engineers. In other words, it is democratic, participatory Taylorism. The outcome suggestions is increased management control. [p. 76] Another possible way of putting it is "Theory Y" Taylorism, or "Theory X ends by Theory Y means."

The team concept, in practice, is far less democratic and bottom-up than Peters pictures it:

In the actual operation of the plant--as opposed to the ideological hype--the main significance of teams is that they are simply the name management gives to administrative units. For the most part, if we substituted "supervisor's sub-group" for team..., understanding of management-by-stress would not suffer at all.

There is, however, some reality to the widespread notions about teams. Some teams meet and discuss real problems. When the lines move slowly enough, workers can and do help each other out. But this is most likely during initial start-up, when the "teams" often consist mainly of supervisors, engineers, and team leaders. Once the line is up to speed, jobs are specified in detail and each worker can barely keep up with his or her own job, let alone help someone else out....

When the system is running at regular production speed, team meetings tend to drop in frequency.... In other cases, team meetings are nothing more than shape-up sessions where quality or overtime information is transmitted to the workers or a supervisor announces changes in assignments.

When management taoks to itself about what makes the system work, teams, in the sense of teamwork or team meetings, are rarely mentioned. In his description of Toyota, considered the reference by many NUMMI managers, Yasuhiro Monden does not use the term "team" at all. He does describe the mandatory Quality Control Circles made up of "a foreman and his subordinate workers." In the entire 230-page book explaining the production system, discussion of these circles totals seven pages, and much of this discussion covers the suggestion system and its rewards.

Similarly, John Krofcik, an MIT researcher and a former quality control engineer at NUMMI, lists teams as one of the reasons for NUMMI's success. But in describing them, Krafcik discusses only the supervisory duties of team leaders... and the peer pressure against absenteeism, not any supposed team powers or problem-solving functions. [p. 35]

And even when the teams are fully functioning as in theory, their decision-making domain is heavily circumscribed:

NUMMI management tries to guide its Problem Solving Circles by placing boundaries on what the circles may address. Included in the untouchables list are: Company Operating Principles, Human Resources Policy and Rules, Supplier Selection, New Model Design, Sales and Marketing Policies. The message is that creativity means finding ways to meet targets established by management [emphasis added]....

If workers may not address those areas--the ones that would actually give them some say over what happens in and to the company--what's left of workers' power? Well, the Problem Solving Circles have the power to kaizen. If "company operating principles"--i.e., leanness--are off limits, how are circles to address problems of workload or understaffing? [pp. 70, 77]

The answer, clearly is that they are not.

So why does the reality described above differ so sharply from the gushing, quasi-syndicalist rhetoric of management theory gurus like Peters? Two words: "Potemkin village." Or maybe three, if you throw in "dupe."

This chapter points to an unlovely picture of life in a management-by-stress plant. It contradicts most of what is said in the glowing accounts of the team concept in the popular media. Where do these accounts come from?

Many stories about how workers feel about life in management-by-stress plants are based on reports of company officials, union officers, or consultants who have some vested interest in the programs' being declared a success. Some very positive descriptions are based on interviews at the time the plant was starting up. As we have described earlier, the conditions, the role of teams and teamwork during the start-up period are transformed by the time the lines reach full production speed. Some reports are based on testimony by workers specially selected by the company to meet reporters. The distortions are then compounded by authors who know little about what life is like in a factory. [p. 37]

So overall, the lesson seems to be that a revolutionary change really did take place in the '90s and the first years of the 21st century. Seen in terms of Peters' liberatory rhetoric, the team concept has meant little practical change. But seen in terms of "management-by-stress," a great deal of change--mostly for the worse--has occurred. Radically downsized workforces have been pushed to their limits, with greatly increased stress and turnover and diminished morale. Although Peters' rhetoric, taken at face value, sounds like something out of Kropotkin or Kirkpatrick Sale, implemented within the framework of a corporate economy it is in practice a system for tightening management control.

But this is not to say that these fashionable management theories are inherently worthless. Just reading Peters' work by itself (especially Thriving on Chaos), without considering the utterly evil institutional environment in which his ideas have been adapted, is almost as exilirating a read as Kropotkin's Fields, Factories and Workshops. As with Kropotkin, many of the ideas he discusses sound like the seeds of a possible libertarian economy, if they were adapted to an overall structure of cooperative ownership and decentralized production for local markets.

And as I've already pointed out, many theorists of the alternative economy have adapted the same ideas to genuinely libertarian structural conditions. Even Parker and Slaughter concede some value to the ideas themselves, if workers had more control over how they were adopted in practice. For example, lean production could be designed to achieve genuine efficiencies without unduly stressful conditions; one possible adaptation would be to supplement the lean, just-in-time model with or flying squads to help work stations with problems, or with a small floating pool of extras to fill in for absentees.

Another example of how the same concepts might be applied differently, if used to empower workers instead of bosses, is kaizen. Instead of (as we saw above) kaizen being used to eliminate jobs rather than reduce the effort required, it might be used for the reverse: as a way for workers to make their own jobs easier. It would be a case of "labor-saving technology," for once, living up to its name.

In a decentralized, cooperative market economy, the built-in conflict of interest currently involved in "process improvement" would disappear. With management representing those doing the work, instead of those trying to get more out of them, most of the so-called "agency dilemma" would be straightened out as cleanly as the Gordian knot. "Change" would cease to be something imposed from above, by those with fundamentally different interests, and would instead consist of decisions made by workers concerning their own work.

Depending on whose power framework these ideas are incorporated into, the resulting world can be either as hideous as an iron-heeled cyberpunk dystopia (Stephen King's The Running Man and Marge Piercy's He, She, and It are pretty effective extrapolations of the kind of world our corporate technofascist overlords are trying to build for us), or as humanly appealing as the 21st century England of William Morris. Either "all will be well, and all manner of things will be well," or the future will be a boot stamping on a human face forever. Or maybe we'll just muddle through somewhere in between, with them trying to enslave us but not quite getting off with everything they want.

But I don't think our corporate masters can keep their grip on the world, and I don't think they can even just muddle through for many more decades. Their state-subsidized economy is generating costs faster than they can externalize them on the rest of us, and it's headed for the breaking point: Peak Oil, the debt crisis, overbuilt highway structure crumbling several times faster than money can be appropriated to repair it, soil driven to collapse by chemical agribusiness, etc. To borrow Stavrianos striking imagery from The Promise of the Coming Dark Age, the seeds of a genuinely new economy are waiting to sprout up through the cracks in the ruins of state capitalism. And when it happens, rather than new wine being poured into old bottles, we'll be using the new ideas as the fundamental organizing principles of a new economy--not to keep the old one on life support.