In 2023, Gary Hamel spoke for many managers and business school professors when he defined management as “simply the tools, the methods, processes and structures that we use as human beings to do together what we couldn’t do alone.“ Tools, methods, processes, and structure are at the heart of management because they are observable, measurable, objective, scientific, tough-minded, disciplined, and rigorous. “As such,” said Hamel, “management is humankind’s most important technology.”
Yet by themselves, tools, methods, processes and structures are inert and deadening. When they comprise the totality of management, there is a risk of having arrangements that undermine human values and create a disengaged workforce—which is where many big organizations are today.
One question I often get is “Aren’t management mindsets just another tool?”, which is like saying, “Isn’t water like air?” It’s true that there is a relationship between management mindsets and tools, just as there is a relationship between water and air. But if you don’t define and understand the terms, and the relationship between them, you can end up very confused.
Tools And Processes In Business
Let’s begin by noticing that “tools and processes” are part of a category of things that are used to get things done in organizations that also includes methods, frameworks, structures, and systems.
In craft work before 1900, it was the craftsman’s own choice as to what tools and processes to use for any particular task. As Frederick Taylor explained in his book, The Principles of Scientific Management, “the most influential management book in the 20th century: “In the past, the man has been first.”
By contrast, in 20th century business, as Taylor prophetically declared in 1911, “In future the system must be first.” It is thus not those doing the work who make the choices. It is the managers who
· choose which tools, processes, and methods are to be used for which task.
· monitor whether the worker carries out the task as instructed.
· reward or punish the workers, as the managers see appropriate.
· issue fresh instructions for the next round of work.
Tools, methods, and processes in business thus became instruments by which managers controlled the workers. In this way, control and hierarchy were built into the very notion of the concept of tools, methods, and processes in business.
The idea that management consists of tools, processes, methods, and structures was dominant throughout the 20th century. Taylor’s prediction proved correct. Humanity was subjected to a series of ‘systems’ that drove behavior. The ‘system’ had different labels at different times and in different contexts, including: Scientific Management, Lean Manufacturing, Lean Six Sigma, Total Quality Management, Business Process Re-engineering, Scrum, Extreme Programming, and Capability Management. It is reflected in the World Management Survey and ISO 9000
In the 20th century, firms implementing these ideas made strong economic gains and much of humanity benefited as customers.
What Is The Purpose Of The Tools And Processes?
Note that defining the concept of management as simply tools, methods, and processes leaves open the question of the purpose of the activity. Thus a bricklayer might be laying bricks to build a wall (something useful), or to build a cathedral (something noble) or to make money for the company and its well-paid executives (something self-interested) or to divide a city (something evil).
As the century wore on, the purpose for the use of tools in business became the self-interested concept of “maximizing shareholder value” (MSV). In 1997, the Business Round Table declared MSV to be the official goal of U.S. business.
If workers didn’t particularly enjoy being told which tools to use, it became even more distasteful when they saw that the purpose of the work they were doing was mainly about making money for the firm and its executives. It should be no surprise that worker engagement is globally low. In 2024, in the U.S., worker engagement hit an 11-year low.
Mindsets In Business
By contrast, “mindsets in business” belong to a category of things that relate to the way people think and feel about what is being done in business. They include mental models, purposes, values, attitudes, feelings, and culture.
Mindsets, culture, and purposes are the element on which tools, methods and processes are silent. They are about the goal or meaning of what is being done.
In 20th century management, mindsets, goals, and purposes were not totally ignored but they were given a lower importance, or even dismissed in principle. That’s because they were seen as fuzzy, unscientific, non-quantitative, subjective and ultimately not very important. By contrast, the goal of making money was concrete and measurable.
Then the world changed. The internet gave first, to firms, new possibilities for innovation, and then to customers, more choices, and finally to firms again, the potential of new business models that built on network effects. As a result, in the last quarter century, leading firms began implementing the converse of Taylor’s dictum. When mindsets, goals, values, and purposes were driving the tools, processes, practices, and methods, they found they could grew faster and generate exponentially more value. In these firms, making money became a result, not the goal.
The terminology used by the firms varied. Apple talked of a different ‘culture’. Microsoft talked about ‘mindset’, ‘empathy’ and ‘values.’ Amazon talked about ‘leadership; principles.’ Some firms talked of ‘mental models’ and ‘narratives.’ The Agile Manifesto spoke of valuing “individuals and interactions” more than “processes and tools.” At LVMH, CEO Bernard Arnault talked of giving designers ‘freedom without limits’. Whatever the vocabulary, this new breed of firm used subjective concepts to drive their business processes,even though mindsets and values were the very things that scientific management had dismissed in principle.
Aren’t Mindsets Just Another Tool?
Managers sometimes respond by trying to use mindsets and mental models as tools. But when they do so, they discover that the subjective nature of mindsets and goals gets in the way.
Workers have to be persuaded or inspired to change. Telling people to change their mindset may succeed in getting workers parrot the required mindset but their heart usually isn’t in it. Instead, managers need to exemplify the mindset in their own language and behavior, and also make the firm’s behavior consistent with the mindset. Managers thus find that thinking of mindsets and values as tools is counterproductive.
The point is that tools are important, but they are fundamentally different from mindsets, culture, and values. It is only when methods and processes are driven by an inspirational purpose and values that they are likely to be truly productive.
In the 21st century organization, understanding the difference between tools and mindsets is crucial.
And read also:
9 Key Insights For The Drucker Forum’s ‘Next Management’ Initiative
How Mindsets Drive Processes In The World’s Fastest Growing Firms