Books@Daily Finance: After the Recession, Fewer Bosses?
In every crisis there is danger -- and opportunity. For Joel Kurtzman, today's difficult economic scene offers organizations the rare chance to "bring down mindless hierarchies."
Don't get the idea that Kurtzman is a bomb-thrower. After all, he's a well-connected business consultant, senior fellow at Wharton, and former editor-in-chief of the Harvard Business Review. His new book, Common Purpose: How Great Leaders Get Organizations to Achieve the Extraordinary (Wiley, $27.95), is a paean to outfits that forge a "creative, dynamic, brave, and nearly invincible we" -- a team spirit built on inclusiveness and mutual goals. But it seems that the imperial CEO and the know-it-all executive have little place in Kurtzman's ideal outfit. After all, he argues that the fault of the current economic mess lies in "bad -- and in many cases, abysmal -- leadership within a large group of global institutions."
It's the author's opinion that the worst of the crisis is over, since he finds that many companies are rehiring. There are, of course, those organizations that are bringing on more top executives even as they lay off rank-and-filers. But that's not the primary problem today, he argues: Worse is inertia -- an uncertainty about how to proceed, that leads to inaction. "Some are stuck," he tells DailyFinance. "They've let people go or cut their hours, and now they don't know how to move forward."
As a model worthy of emulation, he points to FM Global, a 175-year-old property-insurance company with $5 billion in revenues. FM has had no layoffs and understands that its fortunes depend on the knowledge its employees possess. "When you walk into a hallway at that company, you can just feel that people there are committed and that they sense that what they do matters," Kurtzman told a hundred guests at a Manhattan book party at Michael's Restaurant, a publishing-industry favorite, last Wednesday.
FM Global has an unusual approach, the author says: Unlike most insurers, it employs no actuaries -- it depends instead on a staff of 1,400 trained engineers who examine a client's property and price policies, depending on potential problems they discover. The approach means decision-making is widely spread throughout the organization. And that, in turn, means an unusual level of loyalty -- and employment longevity -- among FM Global's workforce.