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Management in the 1980'S by Harold J **) GRADUATE SCHOOL OF INDUSTRIAL ADMINISTRATION Management in the 1980's by Harold J. Leavitt and Thomas L. Whisler CARNEGIE INSTIT UTE OF TECHNOLOGY Pittsburgh 13, Pennsylvania p7. "7/ 77 I i! Management in the 1980's 1 By HAROLD J. LEAVITT and THOMAS L. WHISLER i REPRINTED FROM « HARVARD BUSINESS REVIEW NOVEMBER-DECEMBER 1958 4 i { ( Reprints of Harvard Business Review articles are available ( at the following prices: ( Single reprint $1.00 Four to 99 $ 0.40 each ( Two reprints 1.30 First 100 39-7° ( Three reprints 1.50 Additional 10o's 10.00 each ( Harvard Business Review ( SOLDIERS FIELD, BOSTON 63, MASSACHUSETTS Edited under the direction of the Faculty of The Graduate School of Business HARVARD Administration,Harvard University BUSINESS REVIEW BOARD Stanley F. Ex Officio Neil H. Chairman Vernon R. Alden Stephen H. Fuller Business Robert W. Austin Lincoln Gordon James R. Bright Leonard C. R. Langer Edward C Bursk Ralph W. Hidy J. Keith Butters Thomas J. Raymond E. Raymond Corey Robert O. Schlaifer Bertrand Fox Ross G. Walker Review EDITOR November December 1958 Vol. 36, No. 6 Edward C. Bursk - Associate Editor: John F. Chapman Assistant Editor: David W. Ewing ARTICLES \ Assistant Editor: Dan H. Fenn, Jr. Management in the 1980's 41 Assistant Editor: Rollie Tillman, Jr. Harold J. Leavitt and Thomas L. Whisler Managing Editor: Virginia B. Fales Advertising Director: John Nimmo Sharper Focus for the Corporate Image 49 Industrial Programs: Jacob F. Weintz Pierre Martineau Business Manager: T. K. Worthington Circulation Director: Ernest D. Frawley How to Evaluate New Capital Investments 59 Circulation Manager: Agnes M. Jordan John G. McLean Address all communications, including manu- Let's Export Marketing Know-How 70 scripts and change of address, to Harvard Emlen Business Review, Soldiers Field, Boston 63, Woodruff J. Mass. Telephone: Klrkland 7-9800. New Threat in State Business Taxation 77 Reprints of all articles and features in this Paul Studenski and Gerald J. Glasser are issue, as well as most previous issues, and Fund Investing available. Information on request from Busi- Common Stocks Pension 92 L. Howell ness Office at above address. Paul A Volume Index to the Review is published The Organization : What Makes It Healthy? 107 annually with the November-December issue. Chris Argyris The contents are currently indexed in The Tougher Program for Management Training 117 Industrial Arts Index and in the Bulletin of F. Gordon Barry and C. G. Coleman, Jr. the Public Affairs Information Service. Fashion Theory and Product Design 126 Dwight E. Robinson FEATURES bimonthly Harvard Business Review is published In This Issue: Articles and Authors 5 by the Graduate School of Business Administra- tion, Harvard University. Nathan M. Pusey, The Editors President; Paul C. Treasurer; David W. Bailey, Secretary. From the Thoughtful Businessman: Letters 15 per year, per copy United Review Readers States & Possessions, Canada. — $10.00 per year, per copy Pan- Thinking Ahead: Why Is Education Obsolete? 23 American Postal Union. — Margaret Mead per year, Per copy — elsewhere. Make checks payable to the Harvard Business Looking Around: What Makes Research Sterile? 149 Review. Gerald Morrell Second-class postage paid at Boston, Massa- chusetts and at additional mailing offices. Copyright, 1958, by the President and Fellows The Harvard Business Review does not assume responsibility for of Harvard College. the points of view or opinions of its contributors. It does accept responsibility forgivingthem an opportunityto express such views Printed in U.S.A. and opinionsin its columns. Teele, Dean, Bobdbn, Cabot, $8.00 $2.00 $2.50 $15.00 $3-75 t From In This Issue Harold J. Leavitt and "Our interest in the new tech- Thomas L. nology, however, is not purely a Whisler by-product of this other interest. The alert manager likes to plan Leavitt's research interests have long i ahead. While sharing the univer- centered around experimental stud- sal curiosity of man regarding the ies of communication and organiza- future, the action-oriented execu- tional design, and Whisler has been interested in the wants to know, "What larger implication tive also and also in mean in of of job specialization does all this terms therole of the 'odd' characters in the practical application?" Mindful organization." of swift advances in technology, management can ignore only at Harold J. Leavitt is Professor peril to itself the implications of of Industrial Administration and theresulting pressures on its func- Psychology in the Graduate School tion. Of particular importance is of Industrial Administration at what Harold J. Leavitt and Thom- Carnegie Institute of Technology. as L. Whisler call the new "in- He has served as Consultant to formation technology." the European Productivity Agen- No Orwellian fantasy on life cy, and was Vice President of in the 1980*5, Management in the Nejelski & Company. His latest 19 80s is a reasoned prediction of book is entitled Managerial Psy- the adjustments business organi- chology (Chicago, University of zation must make in the coming Chicago Press, 1958). era. When asked how they came Thomas L. Whisler has been a tobe interested in this subject, the contributor to several professional authors told the Editors: journals and to the Encyclopaedia "We had heard so much recent- Britannica. He is active in indus- ly of the bankruptcy of personnel trial consulting and is Associate managementas a staff function that Professor of Industrial Relations, to School of Business, University of we started explore further. From 1 there we passed quickly to the more Chicago. exciting problem of the changing nature of management in general. — The Editors Harvard Business Review November-December 1958 New information flows cut new organization channels. MANAGEMENT I in the 1980's By Harold J. Leavitt and in the offing, though its applications have not yet Thomas L. Whisler emerged very clearly; it consists of the simula- tion of higher-order thinking through computer Over the last decade a new technology has programs. begun to take hold in American business, one Information technology is likely to have its so new that its significance is still difficult to greatest impact on middle and top management. evaluate. While many aspects of this technol- In many instances it will lead to opposite con- ogy are uncertain, it seems clear that it will clusions from those dictated by the currently move into the managerial scene rapidly, with popular philosophy of "participative" manage- definite and far-reaching impact on managerial ment. Broadly, our prognostications are along organization. In this article we would like to the following lines: speculate about these effects, especially as they (1) Information technology should move the apply to medium-size and large business firms boundary between planning and performance up- of the future. ward. Just as planning was taken from the hourly The new technology does not yet have a single^ worker and given to the industrial engineer, we established name. We shall call it information now expect it to be taken from a number of mid- dle managers and given to as yet largely nonexist- technology. It is composed of several related i techniques for processing ent specialists: "operations researchers," perhaps, parts. One includes or at middle- it is "organizational analysts." Jobs today's large amounts of information rapidly, and management level will become highly structured. epitomized by the high-speed computer. A sec- Much more of the work will be programed, i.e., ond part centers around the application of sta- covered by sets of operating rules governing the tistical and mathematical methods to decision- day-to-day decisions that are made. making problems; it is represented by techniques (2) Correlatively, we predict that large indus- i like mathematical programing, and by method- trial organizations will recentralize, that top man- I ologies like operations research. A third part is agers will take on an even larger proportion of the 41 I 42 Harvard Business Review innovating, planning, and other "creative" func- acteristically, application has not, and probably tions than they have now. will not in the future, wait on completion of (3) A radical reorganization of middle-manage- basic research. ment levels should occur, with certain classes of middle-management jobsmoving downward in sta- Distinctive Features tus and compensation (because they will require call information technology "new" be- less autonomy and skill), while other classes move We not upward into the top-management group. cause one did see much use of it until World War 11, it did not become clearly visible in (4) We suggest, too, that the line separating the and is also, top from the middle of the organization will be industry until a decade later. It new, drawn more clearly and impenetrably than ever, in that it can be differentiated from at least two much like the line drawn in the last few decades earlier industrial technologies: between hourly workers and first-line supervisors. (1) In the first two decades of this century, 1 Frederick W. Taylor's scientific management con- The New Technology stituted a new and influential technology one that took a large part in shaping the design— of Information technology has diverse roots industrial organizations. with contributions from such disparate groups— (2) Largely after World War II a second dis- as sociologists and electrical engineers. Working tinct technology, participative management, seri- independently, people from many disciplines ously overtook — and even partially displaced — worrying problems that have scientific management. Notions about decentrali- have been about zation, morale, and human relations modified and to related and cross-fertil- turned out be closely sometimes reversed earlier applications of scien- point izing. Cases in are the engineers' develop- tific management. Individual incentives, for ex- ment of servomechanisms and the related de- ample, were treated first as simple applications of velopments of general cybernetics and informa- Taylorism, but they have more recendy been re- tion theory.
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