To a large extent, the value of firms is beyond the control of CEOs. “Management“ functions rather like witchcraft. It’s a set of rituals which are wrongly supposed to have effects on the outside world. When, by happy chance, those effects materialize, the witchdoctor takes credit. And when they don’t he blames external malevolent forces – if not the debt crisis then the “challenging economic environment”, “fragile consumer confidence“ or (more feebly) “operational issues (pdf).”
There is enough of a grain of truth in this to give it a certain credibility. We all know people who have succeeded largely because of luck and then spun the success as being due to their own talent, and people who, when they screw up, pass the blame on to forces beyond their control. Often, they are the same people.
But can it really be true that having good managers or mediocre managers actually makes little difference to the business over the long-term? If it is, HR executives, business academics and the entire talent management industry are wasting their time.
Alas, I don’t have time to do a review of the research this morning, though I promise to do one soon. In the meantime, though, I’d be interested to know what people think.
Are managers really just witch doctors? Does organisational success depend on so many uncontrollable factors that managers can only make a marginal difference? Are organisations successful because they have talented managers or are managers seen as successful because they happen to be in high performing organisations?
Reactions, rants and other random thoughts in the usual place please.