Does Management really work?
Authors: Bloom (Stanford), Sadun (Harvard), Van Reenen (LSE)
3 Core Management Elements:
-Targets, Incentives, Monitoring
-Evaluated these 3 management practices in both private and public sector
-Very few were well managed:
-Many were poorly managed: >30
What if management adopt good practices?
Cut defects by 50%
Reduced inventories by 20%
Raised output by 10%
Increased productivity by 20%
Increased average profits by 30%
And - safety improved
Why don't managers adopt good practices?
79% of firms in the study claimed to have above average management practices - no correlation between self-reported scores and those determined using the measures
Managers lousy at self-evaluation of their management practices
Don't recognize (or don't wa
Does good management work in the public sector (hospitals/schools)?
YES,
Hospital - Diagnosis drop 3 weeks to 3 days
Schools - math grades, attendance, and graduation rates, soar
Why is good management adoption so difficult?
-Sometimes national policies/cultures perpetuate ineptness (e.g., trade barriers, trade union resistance)
-Human nature to resist change (uncomfortable)
-Need a burning platform -> the motivation to change
-Resistance can also be overcome with small succe
Does management really work?
YES
-Sometimes good management practices are necessary
but not sufficient
-Sometimes other factors allow a business to succeed
in spite of it's inept management practices
What is management about?
Management is about getting the right work done well