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The issue of managerial obsolescence is an under-researched but important and
compelling challenge of modern day business organisations. Hamlin (1999) describes
managerial obsolescence as a modern organisational virus, implying that its unchecked
spread can severely damage organisational health. This study examines managerial
obsolescence in contemporary times with specific regard to its causes and organisational
impact.
Peter Drucker and various other management gurus perceive managers to be the driving
force behind organisational growth and the most important element of corporate
success (Flaherty, 1999, p 12). Many of such managers, who have the potential to
contribute to the growth and the performance of their organisations, however, become
obsolescent and inadequate for their jobs (Gimeno, et al, 1997, p 750). Little is moreover
done by their organisations to help them in combating such obsolescence challenges;
they are usually sidelined in lesser demanding tasks or replaced by more aggressive and
savvy competitors (Gimeno, et al, 1997, p 750). It is also quite surprising that little
research has been conducted on the issue until now, despite the exponential growth of
Human Resource Management theory and literature and their application in different
areas of organisational activity (Gimeno, et al, 1997, p 750).
This essay investigates the issue of managerial obsolescence, with particular emphasis
on its reasons and organisational impact, and attempts to marshal the various strategies
that organisations can use to counter and combat its challenge.
Managerial Obsolescence
Managerial obsolescence occurs due to the development of a substantial gap between
the requirements of a job and the skills and abilities of a manager to perform such a job
competently; primarily because of his or her inability to keep up with the demands of
the changing times (Harrison, 2009, p 62).
Most managers in the past entered into employment after short stints in college and
progressively developed their skills and competencies, within organisations, through on
job training and experience (Holbeche, 2006, p 13). Whilst such methods for grooming
managers to assume organisational responsibilities continued for decades in AngloAmerican firms, the explosion in management, financial, and technical education in the
west after the closure of the Second World War led to the development of a sea change
in such organisational attitudes (Holbeche, 2006, p 13). Mushrooming management
institutes across the advanced nations started educating and training managers in order
to enable them to assume and discharge their increasingly complex organisational
responsibilities with adequate knowledge, skills and abilities (Harrison, 2009, p 62).
Although the majority of contemporary managers now come into employment with solid
education behind them in different areas like technology, human resources, finance, and
business management, many of them still become victims of obsolescence and find it
difficult to cope with changing and evolving job responsibilities (Harrison, 2009, p 62)
Such obsolescence was rare in the past when organisational and environmental change
was slower and many business firms continued to sell the same products for years to the
same markets in similar environmental circumstances (Holbeche, 2006, p 13).
Managers in such organisations were called upon to perform routine managerial
functions, punctuated by a little bit of troubleshooting during emergencies, and were by
and large able to handle their slowly growing responsibilities with comfort (Holbeche,
2006, p 13). The rapidly changing contemporary business scenario however constantly
challenges organisational managers to keep up with and adapt to changing internal and
external environmental circumstances.
The world has experienced tremendous change over the course of the last few decades
(Lawrence, 2007, p 88). Such changes have been political, economic and technological
in nature. The collapse of the Soviet Union and the growth of neo-liberalism and
western capitalism have profoundly changed the global political landscape (Lawrence,
2007, p 88). Economic liberalisation and the demolition of trade, financial, and physical
barriers have made the business and economic environment intensely more challenging.
The emergence of China, India, and other developing economies has resulted in the
creation of numerous lower cost and equal skill production and service centres across
the world. (Pett, et al, 2004, p 46).Huge new markets are emerging in the developing
world. Astonishing technological advances, especially in the area of instantaneous
communication technology, make it possible for people to communicate swiftly across
continents and even larger distances (Harrison, 2009, p 86).
Such changes are not only providing contemporary organisations with numerous
business opportunities, but are also challenging them to adapt to changing
circumstances, master new technologies, exploit new business opportunities, ward off
and counter threats from competitors and substitutes, and maintain and enhance
competitive advantage (Harrison, 2009, p 86). These developments have not only
resulted in the emergence and astonishing growth of new businesses like Microsoft,
Google, Facebook, Nokia and Apple, but also led to the decline of once great
organisations like General Motors, Ford and Chrysler. The challenges of these changing
times, it must be realised, are not being faced by business organisations but by their
managers. Modern day managers are under intense pressure to constantly adapt to the
numerous changes that are occurring in their internal and external environment (Reid,
et al, 2004, p 37).
The failures of managers to keep pace with and adapt to these changes results in their
obsolescence and to the development of inability to cope with new and evolving
assignments and work pressures (Reid, et al, 2004, p 37). Such managerial obsolescence
has numerous repercussions, both for the organisations in which these managers work,
as well as for their personal careers. Managerial obsolescence is associated with
psychological issues like loss of self esteem, lack of self worth, resentment with peers
and depression (Reid, et al, 2004, p 37).
responsible for ensuring the satisfactory meeting of such demands. The failure of
managers to meet such regulatory and environmental concerns can result in severe
penalties, bad publicity, poor image and adverse repercussions in share markets (Snyder
& Duarte, 2003, p 112).
Modern day managers are furthermore responsible for building the human potential
and capital of their organisations (Holbeche, 2006, p 41). It is widely accepted the
humans constitute the most critical of organisational resources and that no amount of
money or material can be deployed effectively without effective human intervention and
control (Sims, 2002, p 54). Managers are not only responsible for attracting, recruiting
and retaining the best available talent, but in grooming them to assume positions of
increasing responsibility in future (Holbeche, 2006, p 41). Modern day management
experts feel that in circumstances where different organisations have access to similar
capital resources, the differences in competitive advantage between such firms is
essentially provided by managers. Organisational managers are thus responsible for
ensuring that in-house talent is retained, groomed and nurtured adequately in order to
bring about competitive advantage (Holbeche, 2006, p 41).
One of the most important roles of mangers is to foster and bring about innovation.
Peter Drucker has repeatedly stressed in his various writings that one of the most
important tasks of managers concerns the systematic discarding and destruction of
entrenched traditions, customs and products and the bringing about of organisational
innovation in products, services and processes (Flaherty, 1999, p 43). Drucker stresses
that organisations that are not innovative but dominated by tradition and convention
will inevitably be outmanoeuvred and left behind in the rapidly changing global
economy. Effective managers must thus constantly build environments that foster and
encourage innovation in various organisational areas (Flaherty, 1999, p 43).
This section attempts to provide a brief overview of managerial responsibilities and the
criticality of managers in the effective functioning of organisations. Managerial
obsolescence brings about situations in which managers are unable to handle their
multifarious responsibilities and various environmental challenges. Such obsolescence
will obviously reduce the capacity of organisations to fix relevant objectives, formulate
appropriate strategies and implement them effectively. It will also reduce organisational
(b) resistance to change, (c) apprehension about assuming new responsibilities, (d)
disinclination to learn new methods and tools, (e) lack of awareness of the changes
occurring around them, and finally (e) the very denial of obsolescence (Bragg, 1999, p
87). Most contemporary managers, as has been pointed out earlier, begin their careers
with a certain amount of professional and general education in different areas of
organisational work. Their further development as managers however depends
extensively on their own attitudes towards their careers and their perceptions about
their environments (Bragg, 1999, p 87).
Whilst employing organisations can and do offer various types of organisational
training, much of the absorption of such training depend upon the willingness and
attitudes of managers (Chirico & Salvato, 2008, p 169). The rapidly changing internal
environments of modern day organisations, especially in areas of technology, aided
work processes, constantly creates demands on managers. Behavioural experts state
that the willingness of managers to accept and adapt to such changes largely depends
upon their openness to change, their relations with their peers and their attitudes
towards work (Chirico & Salvato, 2008, p 169). Ambitious individuals are far more open
to such changes and are more ready to grab learning opportunities than managers who
are satisfied with their jobs and enjoy high levels of complacency. Behavioural experts
also stress that managerial obsolescence is often not the result of one particular
personality trait but arises out of the interplay of various attitudes that inhibit managers
from learning new skills and from constantly adapting to their changing environments
(Chirico & Salvato, 2008, p 169).
Organisational factors also play important roles in the development of such
obsolescence. Obsolescence can develop in the presence of mismatches between
individuals and their jobs (Dosi, et al, 2001, p 141). Such mismatches can result in
circumstances where the abilities of individuals do not match with job requirements and
thus prove to be inadequate. The lack of autonomy to managers can also lead to slower
development of skills and abilities and to consequent obsolescence. Organisational
experts also associate the onset of obsolescence with non involvement of managers in
decision making roles (Dosi, et al, 2001, p 141). The concentration of power and
authority in autocratic organisations is generally at the top and the bulk of other
employees are expected to meet routine obligations. Such organisational circumstances
reduce the inclination of managers to assume new responsibilities or learn new skills,
and accelerate organisational obsolescence (Lever, 1997, p 37). Obsolescence can also
Conclusions
Managerial obsolescence, the topic of this essay, is an important contemporary
organisational challenge that needs to be purposefully and comprehensively managed by
business organisations.
Obsolescence comes about on account of a number of individual and organisational
reasons and has the potential to steadily undermine the effectiveness and
competitiveness of organisations. Apart from having adverse consequences on larger
organisational health, managerial obsolescence also affects the careers and growth
prospects of individual managers and can lead to their being sidelined, demoted or
removed from employment.
With the majority of individuals reducing their contact with formal structured learning
after joining employment, the onus of lessening managerial obsolescence rests primarily
with organisational managements. Organisations need to recognise the various dangers
and risks that can emanate from the progression of managerial obsolescence and to take
various steps to reduce its incidence.
The adoption of thoughtful HR policies in areas of recruitment and selection, job
allocation, reward and remuneration, performance appraisal and promotions can