Time for
a new paradigm
Coupling automation with a short-term workforce could
make current engineering management concerns obsolete
By Donald Kennedy and Dan Rogers
A
A handy principle we have
used many times is that
people do not change. Any
time-proven management
principle will continue to
hold true because people
will continue to act human (including
to lie, cheat and steal). The late manage-
ment guru and author Peter Drucker
was a leading proponent of a similar
notion by showing how new manage-
ment situations had parallel events in the
past, events from which we can learn.
34 ISE Magazine | www.iise.org/ISEmagazine
He showed that the development of
computers would make IT technicians
important at the beginning, just like the
introduction of the printing press, but
writers and programmers would over-
shadow the technical experts once the
new equipment became commonplace.
The authors of this article have at-
tended hundreds of presentations on
management topics. The useful tool of
fitting new “flavors of the month” into
the established paradigm has worked
well to date. For example, the concept
of high-performing teams is similar to
followership, which is similar to work-
er engagement, which is similar to job
enrichment, which was a rejection of
Frederick Winslow Taylor’s scientific
management, which was a rejection of
the craftwork of guilds, which is similar
to high-performing teams. The work
in the 1950s of Abraham Maslow (hi-
erarchy of needs), Douglas McGregor
(Theory Y), Frederick Herzberg (job
enrichment), C. Northcote Parkinson
(motivation for self-promotion) and

many others articulated the basic prin-
ciples of management that have held up
well for our careers.
Drucker was greatly influenced by the
approach of the Great Depression and
the shattering of the promise of contin-
ued growth forever because (in the mid-
1920s) “this time things are different.”
When things were shown to not be dif-
ferent, Drucker felt safe to promote the
idea that things will never be different
“this time.” The irrationality of peo-
ple will continue to work against any
well-thought-out fads that fail to rec-
ognize that people do not act how they
“should.” This concept has also worked
well for us.
However, there are many signs that
things really are different this time. The
metaphorical black swan may apply to
Drucker’s principle of things not being
different this time. Because things have
had historical parallels up to now, they
will always have parallels – until they do
not. Drucker struggled to find a paral-
lel for the massive urbanization now
underway – turning so many formerly
rural majority countries (e.g., Korea)
into predominantly city-based cultures.
Drucker had to go way back to the de-
velopment of agriculture as his model
for the mass migration to cities and ad-
mitted there is very little written record
of what happened back then to use for
guidance.
More recent developments may not
have any past equivalent. Using history
to understand the present may lead us
to make the wrong decisions. Manage-
ment practitioners may need to start
rejecting the paradigm that has served
us well and brought us to where we are
today. After all, if your workforce won’t
be around for long and your processes
are automated, what good are continu-
ous improvement, worker motivation,
learning curves, performance appraisals
and team building?
What is different?
Much of the material now taught in
management schools was being formal-
ized during the 1950s.
W. Edwards Deming was develop-
ing his statistical control methods at this
same time, but he didn’t become promi-
nent as a management consultant in the
United States until late in his life, during
the 1980s. The important point is the
work environment throughout this pe-
riod. Up until about 2010, it was easy to
find people who had been at their orga-
nizations at least 30 years. In the 1990s,
many workplaces still had retirement
parties for lifelong employees almost ev-
ery month. Company newsletters rou-
tinely highlighted workers celebrating
their 30- or 40-year work anniversaries.
Deming disapproved of the annual
performance appraisal in part because
determining the relative output between
employees did not help the manager
much. After all, managers are basically
stuck with the workers they have, and
there is little to gain from reminding
them of their limitations. Deming stated
that it was much more important to hire
the desired people in the first place, be-
May 2018 | ISE Magazine 35
Time for a new paradigm
cause they would be there a very long
time. He stressed investing effort at the
time of selection and hiring. Then you
allow workers the freedom to develop at
their job.
A little later, business author and
speaker Tom Peters championed the idea
of allowing the seasoned employee to
work around the hurdles placed by man-
agement. Peters knew that good people
eventually will figure out efficient work
practices and how to game the official
policies to get the right things done.
None of the management gurus from
the 1950s to the 1990s considered a work
environment where the majority of the
employees are relatively new. Around
2000, Drucker foresaw a low probability
that employees starting out then would
work at one organization for their
whole career, especially considering the
low chance that any given organization
would last long enough to achieve that.
Co-author Rogers is one of those people
fortunate enough to have had one job
during his career, but it came through
his current employer acquiring the
workers from his former employer and
giving them credit for years spent at the
old organization.
In fact, we performed a random sam-
ple of 300 profiles on the LinkedIn web-
site. These 300 people reported having a
little more than four employers on aver-
age. The median length of time at their
current job is 2.8 years. This implies that
when managers come into a new job,
about half the people reporting to them
will have less than three years of experi-
ence with that organization. Who will
care much about performance reviews
when they know that it is likely that ei-
ther themselves or the manager will not
be there next year?
High turnover was not foreseen by
the people who laid the foundation for
management theory, but it was not the
only change they could not envision.
During the late 1990s, many production
management textbooks emphasized the
ongoing inability for organizations to re-
alize the gains promised by automation.
36 ISE Magazine | www.iise.org/ISEmagazine
The cases of Kmart and Hershey around
the year 2000 are examples of compa-
nies that invested incredible resources
to automate processes. Both hoped for
big gains that were not realized. Similar
failures to launch led to the conclusion
that the human element should remain
the focus of managerial efforts.
The promise that computers would
usher in the paperless office is another
example of an unrealized promise. Small
errors could result in quickly churning
out reams of flawed reports that went
straight to the recycle bin.
But times are changing.
We have recently worked in the of-
fices of major international corpora-
tions where it is difficult to get a hard
copy of anything. Sales orders, delivery
tracking and even timesheets are pro-
cessed electronically. Official signatures
are attached digitally. Subsequent to the
initial failures to meet expectations, re-
search has shown that modifications to
the automated systems are providing
clear paybacks. That is, once the major
expenditure to automate has been com-
mitted to and implemented, it is better
to go with the installed systems than to
turn back.
Automated systems are here to stay,
and the modern manager must reject the
old notion that human factors will re-
main the dominant area of focus.
What are the consequences
of the changes?
We recently toured a modern medical
supply facility. This national supplier
has several processing centers across the
continent. As each new plant is built, the
level of automation is greater than at the
older facilities.
At this newest plant, all production
rates are determined by the speed of the
automated equipment. Human labor still
represents 60 percent of the company’s
expenses, but these workers generally
provide a specific complex task within
the continuous process, a task that is not
yet automated. A higher skilled worker
will not impact output since the rate is
controlled by the speed of the automated
processes.
If a worker has very low productiv-
ity, he or she will not be able to keep up
with the machines. This simply results
in management replacing one worker
with another who can keep up. During
interviews, management reported that
once the plant is fully commissioned
and tuned, they see no material change
in performance over time. The design
of the automated facility up front estab-
lished the operation going forward.
Using this facility as an example, it
can be seen how many of the traditional
managerial concerns are of little con-
sequence. Continuous improvement,
worker motivation, learning curves,
performance appraisals and team build-
ing are of little interest to the executives
here. Employee turnover at the com-
pany runs at around 30 percent per year
(in line with the results of our LinkedIn
sampling). Although people in manage-
ment stated that they would like lower
turnover, it was not important enough
to dedicate any significant resources to
retain workers. Management was not
concerned about losing any key employ-
ees who might have some unrecognized
tacit knowledge that would impact pro-
duction if they left.
As engineering management consul-
tants, we were unable to come up with
any service to offer that would provide
a net value to that organization. Having
tools to optimize the management of
humans was of no interest to this orga-
nization.
Consider Deming’s recommenda-
tions for organizational improvement.
How much effort will a future man-
agement team invest to address any of
them? Just like the management at the
facility we toured, many topics would
be considered nice to have, but it would
be likely that none would be an area of
concern to any degree.
Having a long-term focus is difficult
to achieve when most of the people are
new to the organization and may not
plan to be there long. Using the com-
pany now called Citigroup (and its for-
mer related entities) as an example, the
average tenure of the CEO during the
period 1959 to 2006 was 9.4 years. From
2007 to present that corporation’s CEO
is averaging less than two years at the
job. It is difficult to instill anything but a
short-sighted view when it is a hard sell
to convince people they will be around
to witness any long-term impacts of
changes made today.
Deming’s driving out fear and gain-
ing the trust of the worker are probably
obsolete notions when every worker
sees high levels of employee turnover,
including at the very top.
Increased levels of automation that
threaten every type of work would
add to the workers’ distress. Building
long-term relationships with suppliers
becomes difficult in the current envi-
ronment. During the 1990s, many or-
ganizations we consulted with empha-
sized the value of maintaining trust and
assuring quality through their vendors.
In the past, contractors understood how
to modify their bids to accommodate for
the circumstances they would encounter
with a particular client.
In recent years, many of the managers
we deal with voiced concern that hand-
shake deals and even promises sent in
e-mails were often reneged upon when
there was a chance to make a quick prof-
it at the expense of damaging future col-
laborations. Many times, the handshakes
are now made between people who no
longer work for their respective em-
ployers by the end of the contract. Even
many of those that were still around are
thinking about their new position at the
next company.
The modern
bureaucratic world
In past decades, the informal discussions
at conferences with a management fo-
cus often centered around the frequent
reorganizations companies would put
themselves through. One explanation
for this exercise of organizational churn
that made sense at the time was the
smashing of mini-empires built within
the bureaucracy.
C. Northcote Parkinson (of Parkin-
son’s laws) was critical of the systems that
would become entrenched to create long
lasting busy work for departments, even
when the original reason for the tasks
had been resolved. Laurence Peter (the
Peter principle) watched many workers
rise to the level of their incompetence
to the point where they languished and
waited for their retirement. In addition
to reorganizing, re-engineering and
zero-based budgeting were two of the
management fads introduced, in part, to
battle the inefficiencies of empire build-
ing within bureaucracies.
During a tour of a branch office of a
Fortune 500 company, we noted how
the organizational structure was solidly
defined and cast within its computer-
based systems. Roles were hard coded
into the workings of the company’s
software-based management programs.
Any given employee only had access to
functions within the system that he or
she was accountable for performing.
For example, low-level workers could
requisition a pen when theirs broke.
The computer program would notify
the next level worker of this request and
await electronic approval. This process
required five levels of approval as de-
fined by the software (e.g., supervisor,
accountant, manager, director and vice
president for the relevant department),
which then generated a request for the
procurement chain to commence with
the purchasing process, including all
their approvals.
Recently hired personnel would sug-
gest that the system was overly cumber-
some for many insignificant actions.
This was particularly apparent when
delays resulted because a particular per-
son was absent from one stage; mean-
while, the software patiently waited for
a response. Since the workers performed
these tasks at their computers, and they
could not access functions outside their
domain, they generally did not know
who all was involved. Due to the dif-
ficulty in changing the coding of the
software, the longer-term employees
simply accepted the inefficiencies as part
of the “furniture” and gave up support-
ing any suggestions for improvement.
The corporate organizational chart was
determined when the software was set
up and it was deemed too difficult to try
to alter.
Much of the modern workforce has
become dependent upon software to fi-
nalize decisions. Studies of the variabil-
ity of diagnoses made at hospitals had
previously found considerable deviation
in the conclusions made based upon the
worker’s experience, circumstance and
education. Newer studies have found
that among workers who use the same
software, variations in diagnoses are
small.
Getting a second opinion now only
has meaning if you go to a person using
a different medical software application.
Modern managers have a reduced need
to identify strengths and weaknesses in
their subordinates if you consider that
their workers’ output may soon become
subject to the software they happen to
use.
A new frontier
The motivation for this article has been
the realization that times may be chang-
ing – this time for real. We may need
to rethink our traditional response of
pooh-poohing the promise of increased
effectiveness through software applica-
tions. The initial response that proce-
dures manuals and operations protocols
are not worth bothering with may also
be wrong considering the workforce
largely consists of people unfamiliar
with an organization’s normal practices.
Rejecting new management program
rollouts because “They are only another
flavor of the month and will be replaced
soon with a new flavor” may be a stance
that fails to recognize that real change
is coming.
Key strategies for success that worked
in the past may need to be replaced. An
example from project management is
May 2018 | ISE Magazine 37
Time for a new paradigm

When worker motivation

becomes a minor concern
Albert Einstein’s theory of relativity celebrated its 100th
birthday in 2015. Physicists are fairly confident that
their basic tenets are sound, as are chemists, biologists
and other natural scientists.
Frederick Winslow Taylor’s scientific management
is about as old as relativity, but social scientists are
not as lucky to have a firm foundation to work from.
W. Edwards Deming championed the concept of
eliminating attempts to compare workers and annual
appraisals. Deming’s ideas seemed to be gaining
traction in the mid-1990s, but it appears management
has generally rejected his recommendations and moved
back to more traditional (Taylor-like) approaches.
The aim of many such management researchers has
been to optimize the production of the workforce.
These days, automation is becoming more
increasingly embedded in the workplace. The workforce
is becoming more transient, with few workers
remaining at the same organization for decades or
even years. With those two changes, the old goal of
“How can I get the desired output from the people I
have?” may be losing its relevance for the manager of
the future. Worker motivation, productivity and even
retention may become of minor concern to many
modern organizations.

the insistence of the right to hand pick
your project team. When you are new
and many of the potential team mem-
bers have been in the organization a
short time, what value does hand pick-
ing people you are unfamiliar with add?
If you don’t have – and never will have
– experienced workers, then believ-
ing that experienced workers will find
the workarounds to offset inefficien-
cies built into processes may be short-
sighted.
The focus on retaining key high per-
formers and incremental improvements
may become obsolete.
However, as one hopeful vision,
perhaps the new organization will be-
come filled with people who continu-
ally respond to automated systems and
thus lose the ability to question ineffec-
tive processes. Perhaps a need for a new
breed of industrial management con-
sultant will arise. Following Thomas
Kuhn’s observation that it takes an out-
sider to recognize inconsistences – such
as Albert Einstein being a patent clerk
and Antoine Lavoisier (father of modern
chemistry) being a tax collector – future
management consultants may be the
people who can see the impact of the au-
tomated processes because they are not
involved at a day-to-day level.
Going forward, industrial manage-
ment requires a new set of tools to ad-
dress the issues without historical prec-
edent. We will soon find that things
really are different this time. 
Donald Kennedy is a fellow of the Ameri-
can Society of Engineering Management
and a professional engineer in Canada. The
Ph.D. has spent most of his career on heavy
industrial projects in the fields of oil and gas,
pipelines, electrical power generation and min-
ing. He also has lectured at universities on
financial and project management. He has
published two books, including Flogging
the Innocent, and numerous magazine
and journal articles. He has worked in more
than 45 organizations as either an employee
or consultant, including three within the past
year, despite placing a high value on long-term
employment.
Dan Rogers has managed people within gov-
ernment and industry organizations, with a
major focus on the aviation sector. Rogers is
interested in the implementation of automated
systems and the impact it has on the reduced
requirements for highly skilled workers.

38 ISE Magazine | www.iise.org/ISEmagazine

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