

How Agile Is Destroying Management - Ovid
https://www.youtube.com/watch?v=jBU-3e4rqPo

======
dalke
The talk's simplicity drives me a bit batty.

The British feudal society was not so clearly hierarchical. Now, he says it's
a "gross simplification", with the goal of expressing some underlying
truthiness. But over and over again he says that people in the hierarchical
system don't question their position.

See the Magna Carta and the Peasants' Revolt of 1381 as two examples where
people did question their position under the feudal system.

See matrix management and dotted line manager as examples of modern attempts
at alternatives to strict hierarchical structures.

The speaker complains about the lack of internal markets at a large company.
OTOH, the promotion of internal competitive markets is often described as one
of the reasons for the downfall of Sears. See
[http://www.forbes.com/sites/stevedenning/2013/07/16/do-
inter...](http://www.forbes.com/sites/stevedenning/2013/07/16/do-internal-
markets-nourish-innovation-the-case-of-sears/) :

> The model “also created a top-heavy cost structure, according to a former
> vice president for human resources. Because Sears had to hire and promote
> dozens of chief financial officers and chief marketing officers, personnel
> expenses shot up. Meanwhile, many business unit leaders underpaid middle
> managers to trim costs.”

> For innovation, internal markets have the same problem as hierarchical
> bureaucracies. Managers vote their resources for innovations that bolster
> their current fiefdoms and careers. The safest strategy is to stick to the
> status quo. Ms. Kimes’ article gives multiple examples where competing
> managers at Sears looked after their own units at the expense of the
> interests of the firm as a whole.

There's also the problem that he compares companies to feudal societies,
without the awareness that feudalism is relatively new. The Roman Empire had a
non-feudal society, but was still structured hierarchically.

In fact, to quote from
[http://en.wikipedia.org/wiki/Feudalism#History_of_feudalism](http://en.wikipedia.org/wiki/Feudalism#History_of_feudalism)
:

> Feudalism, in its various forms, usually emerged as a result of the
> decentralization of an empire: especially in the Carolingian empires which
> both lacked the bureaucratic infrastructure[clarification needed] necessary
> to support cavalry without the ability to allocate land to these mounted
> troops.

The speaker describes feudalism as a centralized command-and-control system.
That doesn't fit the idea that it's a decentralized system, with respect to an
empire.

Is a company structure more like late feudal England? Or like Imperial Rome?
If the latter, then it's wrong to say that modern companies are "feudal".

Edit: Grr! And it's like the 1950s-era push towards flat corporate structures
never existed. Nor the co-op movement like Mondragon Corporation.

~~~
Ovid
Your complaints are interesting (I'm the speaker). That talk was a gross
oversimplification in many ways as I've pointed out. Note that the core talk
was 35 minutes and no, there's no way that I could give it as fair of a
coverage as I would like. Your example of the Magna Carta, however,
strengthens my core point (IMHO): nobody thought to end the system and try
something new, they were trying to stop the king from acting arbitrarily. For
the Peasant's Revolt, the people primarily sought an end to serfdom and the
abuse they suffered thereby, but in no way considered that a _different_
system might be better (which is what I kept getting to throughout the talk).

I would also point out that matrix management switches corporate hierarchies
from trees to graphs: it doesn't change its fundamental nature of command and
control. It's an attempt to tinker with how things are done and frankly, it's
about as revolutionary as having car doors open backwards instead of forwards
(and in my experience with matrix management, it's just as stupid of an idea).

As for Sears, thank you for that link. Yes, there are definitely going to be
cases of companies trying and failing. How does that invalidate the point?

As for your other comments, I'm not going to belabor them, but there's a rich,
rich background of people comparing modern corporations to feudalism:
[https://www.google.fr/webhp?q=corporations%20feudalism#safe=...](https://www.google.fr/webhp?q=corporations%20feudalism#safe=on&q=corporations+feudalism)

Or you can read this interesting one by the former chief economist of Valve
Software: [http://blogs.valvesoftware.com/economics/why-valve-or-
what-d...](http://blogs.valvesoftware.com/economics/why-valve-or-what-do-we-
need-corporations-for-and-how-does-valves-management-structure-fit-into-
todays-corporate-world/) (if that face looks familiar, it's because he's now
the finance minister of Greece).

Again, 35 minutes to give an simplification of the problem and I know there's
tons I left out (including co-ops) and there's absolutely no way I could cover
it all and still get to the point of that talk.

~~~
dalke
[My reply was too long for HN. This is part 1/3\. Sorry!]

What David Graeber's "Debt: The First 5000 Years" years has taught me, above
all else, is that most economists from Adam Smith onwards know little about
history and anthropology. I already knew that people like to spread just-so
creation myths. In many cases, these end up being ungrounded in reality, but
instead are meant as short-hand for the general culture _belief_ of how
something worked, rather than the reality.

A somewhat relevant example, look at
[http://westernreservepublicmedia.org/middleages/feud_peasant...](http://westernreservepublicmedia.org/middleages/feud_peasants.htm)
as an example of how people tell untrue stories about the Middle Ages. The
source is the Northeastern Educational Television of Ohio, and the page says
"The main crops were corn, wheat, and beans. Near their homes, peasants had
little gardens that contained ... tomatoes..."

In the US corn means maize -- "Indian corn". In the England "corn" refers to
wheat, and in Scotland and Ireland it refers to oats. So either this is saying
that maize (and tomatoes) somehow made it from the Americas to Europe before
Columbus, or that the main crops were "wheat, wheat, and beans." Either way,
it's wrong.

Here are more specific issues I have with your simplifications:

1) "The Feudal Era ... I specifically picked England, post-Reformation, after
Henry the VIII."

The feudal era was already in decline by that point. Compare your statement to
[https://medieval-global-studies.wikispaces.com/Feudalism](https://medieval-
global-studies.wikispaces.com/Feudalism) :

> At the end of the middle ages, feudalism still somewhat existed, but King
> Henry VIII gave the last blow. In the feudal pyramid, the pope was higher
> than the king. King Henry VIII broke away from the pope, and the feudal
> system had ended.

This is relevant because the Irish people believed that the Pope was the
feudal head of Ireland, with Henry acting at the Pope's representative.

Or to [http://karelma.com/english/history/henry-
VIII.html](http://karelma.com/english/history/henry-VIII.html) :

> Thomas Wolsey ... was tirelessly ambitious, very quick-witted, and also
> ingratiating by aptitude, which appealed well to Henry VIII. Together they
> gave a strongly _anti-feudal_ , reformist character to the politics.

Or to
[http://www.boydellandbrewer.com/content/docs/Decline%20of%20...](http://www.boydellandbrewer.com/content/docs/Decline%20of%20Serfdom%20revised.pdf)
:

> It follows that [feudalism's] disappearance [in England] between c.1300 and
> c.1500 changed medieval society fundamentally.

Or to [http://www.sixwives.info/henry-viii-
accomplishments.htm](http://www.sixwives.info/henry-viii-accomplishments.htm)
:

> King Henry VIII added Imperial concepts of Kingship to existing Feudal
> concepts

I cannot accept your use of a post-Henry VIII England as being representative
of a feudal structure. By all accounts, feudalism was a minor part of Late
Medieval England. I find it easier to believe that it's representative of a
new and growing imperial structure, and an increasing _centralization_ of
power.

Compare England to Sweden, which did not have serfdom. The Swedish Empire was
from 1611 to 1721. During that time, Sweden was one of the great powers of
Europe. Your thesis would mean there are some intrinsically important
differences between the absolute monarchy in England and the absolute monarchy
in Sweden, because one was based on serfdom and the other was not.

Could you describe a few of the key differences between the hierarchies of the
English and Swedish monarchies of the 1600s that were due to serfdom? Because
I can't think of any, and your thesis requires that there be key differences.

2) "Allegiances in feudal societies tended to be very local ... why did all
the soldiers follow Macbeth?"

This is, well, nonsense. Why did the soldiers follow Julius Caesar? Or for the
same time period, look to Norway. Norway never had a feudal society. Why did
all of the Christian, medieval, people of Norway follow their kings, even into
battle?

Macbeth is nominally about Mac Bethad mac Findlaích, who died in 1057.
Feudalism came to Scotland later, as part of the Davidian Revolution (see
[http://en.wikipedia.org/wiki/Davidian_Revolution](http://en.wikipedia.org/wiki/Davidian_Revolution)
) during the reign of David I (1124–1153).

So not only are you using a fictional example to justify your views, but that
fiction isn't even historically accurate.

~~~
dalke
[My reply was too long for HN. This is part 2/3\. Sorry!]

3) "all of us would have been serfs ... that was the vast majority of history"

Serfs are not part of the "vast majority of history." Quoting now from
Wikipedia, "It was a condition of bondage which developed primarily during the
High Middle Ages in Europe and lasted in some countries until the mid-19th
century."

You started in Henry VIII. There were few serfs in that era. Go back in time,
and there were certainly more. Go back further and they didn't exist at all.

There were rough equivalents, certainly, but slaves, serfs, indentured
servants, etc. are all different. During feudal England, serfs were also
different from villeins or smallholders, though all were peasants. (See
[https://books.google.com/books?id=ax0ed_OEzvwC&lpg=PA49&ots=...](https://books.google.com/books?id=ax0ed_OEzvwC&lpg=PA49&ots=WzcINRljHx&dq=smallholder%20domesday%20book%20serf&hl=sv&pg=PA49#v=onepage&q&f=false)
for an example of a town with "about 90 villeins and smallholders, plus about
9 serfs or bonded labourers.")

I can accept that you mean to paint with a broad brush, but the brush should
be labeled "peasant" or "slave", not "serf". Modern people do sometimes call
themselves "wage slaves", after all, and slavery existed for far longer than
serfdom.

4) "you worked as a serf on a manor that the lord oversaw. You didn't see the
other manors. ... You probably never traveled [to the town over where your
cousin worked]. You might not even know about that cousin."

There is an internal inconsistency error here. The parents of me and my cousin
were siblings, from the same parents. If what you say is completely true, then
how did my parent and his/her siblings end up on different manors from where
they were born?

There were alternatives, even for peasants. Here's the Charter of London -
[https://books.google.com/books?id=7nBZAAAAYAAJ&pg=PA109&lpg=...](https://books.google.com/books?id=7nBZAAAAYAAJ&pg=PA109&lpg=PA109&dq=year+and+a+day+free+city&source=bl&ots=0WWAqOqmYg&sig=iRyTcYrvxO9y_CtEdlCeiv1Km7M&hl=sv&sa=X&ei=CTQ-
Va6REIqrswGRrYGwAw&ved=0CDkQ6AEwAw#v=onepage&q=year%20and%20a%20day%20free%20city&f=false)
. Should someone be in London for a Year and a Day, "without reclamation of
his Lord", that person would be granted rights to stay permanently in the
city. Increasingly after the Black Plague, there was the chance of buying out
one's own bondage.

There was also travel in that era, even for peasants. Perhaps the most popular
was to go on a pilgrimage. According to
[http://www.aromasysabores.com/camino/historical_background.h...](http://www.aromasysabores.com/camino/historical_background.html)
:

> In the 11th and 12th centuries, millions of people from all over Europe made
> pilgrimages to Santiago [de Compostela]. It has been estimated that in the
> 12th century 10 percent of the population of Europe was involved in making
> or in some way supporting the pilgrimage to Santiago.

According to [http://www.pilgrimisverige.se/att-vara-
pilgrim/historia-1727...](http://www.pilgrimisverige.se/att-vara-
pilgrim/historia-17272346) (in Swedish; I couldn't find an English source):

> Miljoner och åter miljoner människor var ständigt på väg och man har
> beräknat att mellan år 1150-1450 deltog mellan 20 och 50 procent av Europas
> vuxna befolkning i pilgrimsvandringar.

> [My translation:] Millions upon millions of people were constantly in route
> and it's been calculated that between 1150 and 1450 between 20 and 50
> percent of Europe's adult population took part in a pilgrimage.

From "Canterbury Tales" we get an idea that people from all walks of life went
on pilgrimages. But there's no need to resort to fiction. See
[https://archive.org/stream/englishwayfaring00jussmiss#page/2...](https://archive.org/stream/englishwayfaring00jussmiss#page/262/mode/2up)
where it says (p 263, and footnote 2):

> .. but in such another county, they heard or supposed, there was better pay
> an less exacting masters [2].

> [2] See a concrete example of such reports being brought from the north to
> the south by pilgrims, further, p279.

> [p279] The report had been brought to the city of Canterbury by pilgrims,
> peregrini, arriving from the North, obviously to worship at the shrine of
> St. Thomas.

Certainly even serfs had knowledge about the outer world through contacts like
this.

And finally, from that same source
([https://archive.org/stream/englishwayfaring00jussmiss#page/2...](https://archive.org/stream/englishwayfaring00jussmiss#page/274/mode/2up)
) we see that the ravel restrictions even at their harshest were not to the
manor, as you said, but to the hundred, city, or borough. A hundred is a
subdivision of a county and contains several parishes and many towns and
manors. It is very likely that you would know your cousin the town over
because it's within the same hundred.

~~~
dalke
[and part 3/3]

5) "nobody thought to end the system and try something new, they were trying
to stop the king from acting arbitrarily"

What does "new" mean to you?

You advocate organizational structures which eliminate or at least greatly
reduce management. You give Semco as an example, saying "[the owner] recently
celebrated 10 years of owning the company and not making a single decision."

Yet this is a classical capitalist structure. Semler owns the company, and its
capital, and employs labor. Should he wish, he could sell the company or fire
all of the workers. In that regard, it isn't a new idea, only a clever
variation on way for a capitalist to accumulate wealth without doing any work.
It appears to be successful. No wonder other capitalists might be interested
in such a system! There's no need to pay for stewards and reeves when the
peasants will do that themselves.

I mentioned Mondragon Corporation because not only does it have the workplace
democracy you extoll, but it's a company based on co-operative ownership of
capital. See for example Richard Wolff's lecture at
[https://www.youtube.com/watch?v=mKbukSeZ29o](https://www.youtube.com/watch?v=mKbukSeZ29o)
, where he also mentions that the employees hire and decide how much to pay
the management.

Are you therefore really proposing something different? Or just another
variation of the same capitalist system?

So when you say "in no way considered that a different system might be
better", what does that mean? The peasants called for an end of serfdom. How
is that _not_ an expression of a desire for something different? Or rather,
what evidence would you need to be convinced that there were desire for other
systems? The Twelve Articles from the German Peasants' War also called for an
end of serfdom.

I do not think it's tenable to say that the peasants of that era did not
believe that a non-feudal system might be better than what they had.

~~~
Ovid
I just want to thank you for the very insightful comments you've made and it
will definitely help me reform the background of what I've written. I think
that _largely_ my key points about modern corporations are generally on point
(particularly lack of innovation and command-and-control structures), but it's
clear that I could do better with my analogy than comparing it to post-
reformation England.

I knew about co-ops, but many of them that I could were largely agricultural
or small stores and didn't resonate with my audience, but perhaps I've done
them a disservice. I'll look into Mondragon also, thanks!

~~~
dalke
Thank you for the thank you.

You gave the sort of answer I have grown to expect from management
consultants.

You have a thesis you want to get across. The basic idea - decentralization
and industrial democracy - have been around for almost 100 years, counting
from the Wobbly Shop. But the type of people who hire management consultants
are not those who want to hear about ideas from anarchist trade union. Nor are
they the type of people who want to hear about cooperatives. The goal of both
are, after all, to reduce the power of the capitalist owners who employ
management consultants.

Instead, people prefer to hear more gentle examples, like Semco, which fit
into the standard capitalist framework. Then when those are labeled "radical",
it's okay to ignore anything which is more radical.

I have found a reference which does an excellent job of characterizing the
differences. I quote now from
[https://books.google.com/books?id=IKZVKMPEQCEC&pg=PA131&dq=%...](https://books.google.com/books?id=IKZVKMPEQCEC&pg=PA131&dq=%22wobbly+shop%22&hl=sv&sa=X&ei=Y6U-VY7fNoyusAHq8IHwAw&ved=0CGMQ6AEwCTgK#v=onepage&q=%22wobbly%20shop%22&f=false)
:

> Industrial democracy: By analogy with political or state democracy, a
> description of democratic practices as applied to workplaces. There are two
> major ways of thinking about this concept. The first involved some liberal
> conception of representative structures that allow workers to have influence
> over decision making, responsibility and authority. The extent of such
> influence can vary substantially, from an employer's 'suggestion scheme'
> through workplace methods such as 'team-working', up to the various forms of
> consultation and co-determination exemplified by Kalmar, Semco, or the John
> Lewis Partnership and the Quality of Working Life movement. Whilst these
> examples provide illustrations of alternative forms of organizing, they all
> largely rely on the idea of empowerment as something which management does
> to workers. In other words, management and owners still have the ultimate
> sanction, and could withdraw democratic privileges if they wished.

This is the same observation I mentioned earlier - Semler is a capitalist and
owns the methods of production. If he wanted to sell Semco, he could.
Continuing the quote:

> The more radical way of thinking about industrial democracy would be in
> terms of worker self-management. In this case a cooperative or an employee
> share ownership plan (ESOP) would mean that all those working for an
> organization would have a direct share in its profits and losses. As a
> result, they would have a clear interest in participating in democratic
> mechanisms to elect or deselect those who coordinate organizational
> activities; to dictate strategy; to take profits or reinvest, and so on (see
> Mondragon; Suma). Both forms of industrial democracy have been credited with
> increasing the motivation and commitment of workers, as well as increasing
> productivity and decreasing labour turnover. Whilst advocates of the liberal
> version might suggest that those were good things to achieve because they
> can increase shareholder or owner value, for the radicals all these would be
> secondary to the idea that labour might escape alienation in a Marxist
> sense. In other words, liberal ideas about job satisfaction are pale
> reflections of the conception of work as a form of human expression (see
> Fourier).

I think you can see why I said your proposal is not new, and it's not radical
- it fits cleanly inside of the box of traditional capitalism.

The story you pushed happens to be one that makes capitalists content. It
changes nothing for them, except to bring in more profit. That's why this is
the type of story that gets passed around - rather, more so because Americans
identify more with the capitalist owner than the labor class they actually
are.

(You suggest that co-ops won't "resonate with [your] audience" \- of course
not! In your own words, liberal capitalism is all they know about!)

Your addition to it is to add a layer of intellectualism, by suggesting that
the command-and-control structure shares many similarities with feudal
structures as if that's meaningful. It isn't, because it's identical to the
command-and-control structure of non-feudal imperial and absolute monarchism,
neither of which require serfdom.

It doesn't seem matter to you that your justification has no historical basis.
You regard it as a simplification to get your point across. I regard it as a
truthiness, where you think it's okay to get things wrong, because a good
story that conveys the aspirations is good enough.

But it's bad scholarship. It does yourself and your listeners a disservice to
spread fables as if they were truths. I think you also should ponder why it
was you felt your knowledge of the feudal era was correct to use the analogy;
perhaps there are other topics you elaborate upon with equally shaky footing?

