At our autumn conference held in Oxford in September, we were fortunate to be joined by Chris McKenna, University Reader in Business Strategy and History, a Fellow of Brasenose College, Oxford, and the Director of the Novak Druce Centre for Professional Service Firms at Saïd Business School. He studies the historical development and strategy of professional firms, and their role in shaping global business. This session examined how managers, leaders and entrepreneurs adapted to the context of their times and to what extent they were equal in stature with the classical professions.
What constitutes a profession?
According to Chris, understanding context and the history of our times enables us to control our own destiny and ensures that we don’t become a cog in the system; mastering context helps us to plan our personal career trajectory. For example, ESCP was the world’s first business school, established in 1819. However it would be the later Harvard Business School, established in 1908 that would go on to define business education. Harvard had a goal – the professionalization of business management. Since there was almost 100 years difference in age between the schools, their relative historical contexts were very different, as was their geographical and cultural backgrounds. Interestingly, ESCP still brands itself today as ‘the world’s first business school (being)’. Harvard, on the other hand, talks about its 100 year role in shaping business around the world (doing). In other words, it demonstrates true leadership qualities.
There was some discussion amongst the audience around what constitutes a profession (apart from the classic ones such as medicine and law). To what degree do consulting and management constitute ‘real’ professions? What differentiates a profession from a trade – for example is hairdressing a profession or a trade? Chris uses a set of sociological characteristics to determine whether a given activity is a ‘true’ profession or not. Law, for example, has a very clear mission, requisite education, specialized journals, self-governance mechanism (disbarment), state certification and a common body of knowledge. It is also highly structured and regulated, and is a good benchmark against which to evaluate other functions.
Management through the ages.
Chris also highlighted the impact that contextual factors had on different periods. These include government intervention, global affairs, demography, social values, technology and labor-related developments. In the 1920’s, some critical contextual factors included anti-trust investigations, population migration to cities and the liberalization of labor laws. Having emigrated from France to America to escape the French Revolution, the DuPont family created a monopoly in the production of gunpowder. Due to the focus on anti-trust at that time, they made a strategic decision to diversify into a conglomeration of associated industries. The 1920’s witnessed the development of a number of these large conglomerates along with a variety of well-known brands.
Entrepreneur Joan Trippe founded PanAm. Manager Robert Woodruff drove the international growth of Coca-Cola. Leader Gerard Swope expanded General Electric’s utility business into a broader consumer market. Conglomerates continued well into the 1960’s and 70’s, with entrepreneur Sam Walton revolutionizing logistics at Wal-Mart. Once a rage, however, by the 1980’s conglomerates had become a relic – ‘inefficient and byzantine’ (New York Times). Except in developing nations like India – demonstrating how contextual factors vary not only over time, but are also affected by local institutional dimensions.
Chicken or egg? Horse or cart?
It’s clear that contextual factors influence how organizations develop; but does it explain the success of those leaders, entrepreneurs and managers? What lessons can be drawn from this? Take Nucor’s leader, Kenneth Iverson who bucked the trend of shrinking American and European steel manufacturers in the 1960’s. He pioneered the use of small, electric recycling plants, improved quality at the lower end and went on to dominate the industry. Another example: the development of the European textile industry is very much part of the ‘Industrial Revolution’; but the British eventually lost out to the cheaper developing countries. On the other hand, the Americans invested in vertical integration, which saved them from the plight of the British. What actually triggered that?
Organizational sea-changes over time.
Many of the technological innovations which we have seen since the 1960’s have been created outside of mainstream organizational life, often in garages. Companies developed large well-funded research and development departments to try to harness expertise and knowledge, hoping to create competitive advantage. This almost mirrors the bringing of labor into factories in the early 19th century, leading to mass production, assembly lines and automation. But organizations can no longer be successful by building new, albeit innovative, products (like the Model T Ford which lasted 20 years). Although technological innovations continue apace, social and lifestyle applications of technology are becoming more and more important. Increasing longevity and changing age demographics are set to impact the economy in the coming decades. Globalization is affecting how we think, learn, work and play. The speed of electronic communication, social networks, mobile ‘phone technology all contribute to how we interact, and socialize. They also provide increasing ways to analyze where we are, what we are doing and saying. The bottom line is that we can learn a lot by looking at the past – back to the future?
A question of relevance.
So, what does all this mean to us as change consultants, managers and leaders? Since Chris differentiated between consultants (quasi-profession) and managers (not sure), does it mean that our professional status is determined by how we bring our knowledge to market? If we are external consultants, we are professionals; but if we are change managers within an organization, we are not? That doesn’t seem to make sense. In fact the weakness that I see in this argument is mixing functions with knowledge. The strength of law as a profession is not whether you are a solicitor or a barrister; it is the common body of knowledge encompassed in laws and procedures.
This does have implications for us as consultants in change, and the question of whether change consultancy is a profession remains largely unanswered. I think this is an interesting discussion point, especially considering the approach demonstrated by Chris. Personally, I wonder whether an answer is necessary. As change specialists (to use a more innocuous term), I think it’s important that we keep ourselves continuously open, adapting as we should to the changing context which accompanies us throughout our lives. Each new innovation, development, generation should impact how we think and how we approach our work. This approach of course does not align with the focus of organizations like the Change Management Institute and the Association of Change Management Professionals, who are working to create strict standards for change management. I consider this to be critical; but it shouldn’t suffocate thought leadership, which has to be driven by reality, not rules. For me, that’s the difference between management and law. Julie Mowinski