A Glut of Managers, Dearth of Leaders
A Glut of Managers, Dearth of Leaders
STEVEN P. ROSENFELD
Mar. 18, 1986
NEW YORK (AP) _ Coping with crises, tough international competition and rapidly changing technologies may be such big problems for American businesses because they are top heavy with managers and light on leaders, some academics and executives say.
Leaders are problem finders who overcome obstacles and build a business by shaping corporate values that motivate employees, these experts say, while managers, skilled in analysis, focus attention on piecemeal problem solving.
''Leaders do the right thing; managers do things right,'' says Warren Bennis, a professor of management and organization at the University of Southern California and co-author with Burt Nanus of ''Leaders: The Strategies for Taking Charge.''
''Too many of our organizations are overmanaged and underled,'' Bennis says.
Alienation in the workplace, he says, is a symptom of management preoccupation with quantity rather than quality.
Instead of using rewards and punishment to keep workers in line, leaders have a style ''that pulls rather than pushes people along,'' he says.
Such leadership is evident in the culture of a company, a condition that exists when employees not only know how they are expected to perform but share a vision of what they are working for.
Bennis, who studied 90 chief executives from 1978 to 1983, said he found two key traits of leaders that contributed to establishing a corporate culture - a guiding set of concepts and the ability to communicate that vision.
These concepts create an identity, a direction and values for a company, making work meaningful for employees who share those views, he says.
They may embrace seemingly insignificant issues.
The late Ray Kroc, founder of McDonald's restaurants, had a vision of the business that ''made you sit on the end of your chair when he talked about hamburgers and fries,'' Bennis recalled during a recent panel discussion on corporate culture sponsored by the Conference Board.
Tough times are the test of management's commitment to its corporate principles.
For Johnson & Johnson, it was a well-entrenched corporate culture, known as ''Our Credo,'' that twice guided the health care products giant through product-tampering crises that turned its best-selling pain-relief product into a murder weapon, frightening consumers around the world.
In September 1982, someone laced capsules of Extra-Strength Tylenol with cyanide and put the packages on store shelves. Seven people died in the Chicago area. Last month, tainted Tylenol capsules surfaced in Bronxville, N.Y., claiming another life and leading Johnson & Johnson to scrap capsules for all of its over-the-counter medication.
Johnson & Johnson spent $100 million pulling its product off the shelves and destroying 31 million bottles of capsules in 1982 and will spend at least that much this time around.
In a pattern established in 1982 and followed again this year, Johnson & Johnson kept the public and its employees informed every step of the way.
In the first crisis, Tylenol's share of sales of over-the-counter pain relievers plummeted from 35 percent to below 7 percent. But when that crisis passed and new tamper-resistent packaging was introduced, Johnson & Johnson found it had not lost consumer support.
Although the company was receiving unsolicited advice that the brand was dead, it believed it never lost the loyalty of its customers and was able to reintroduce Tylenol capsules in 1982, regaining virtually all of its lost share of the market.
David Collins, chairman of the Johnson & Johnson subsidiary that makes Tylenol, credited the 1982 recovery to strong leadership and adherence to the company credo, which puts customers, employees and the community ahead of stockholders.
''We all were confident on how to proceed because we were guided by the value system of Our Credo,'' he said. ''Your first obligation is to the customer, if you lose that focus you tend to lose just about everything you're in business for.''
After the second poisoning ordeal, Johnson & Johnson said it no longer could guarantee the safety of capsules and abandoned the popular dose form.
''A lot of our credo talk sounds very pretentious and very 'Isn't that wonderful.' It's very pragmatic,'' said James Burke, Johnson & Johnson's chairman through both crises. ''The fact is we are in business to serve you, our customer. That's the only reason we're here. And if we serve you better than our competition, we'll gain in share of market and if we serve you worse we'll lose in share of market.''
End Adv PMs Wednesday March 19