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On the starboard tack: are you a right-thinking business mind, or will you be left far behind by evolution? David Allen contrasts the old and new management styles in terms of how they use the two sides of the brain.

As its inhabitants well know, the world of business is characterised by a competitive struggle for existence. Only those best suited to the prevailing environment can be confident of survival.

It's also widely appreciated that the current environment is a volatile one, for which the old "command and compliance" approach to management is not a good fit. Its adherents are almost invariably shrinking (or, as they would prefer to put it, downsizing) their businesses in order to maximise shareholder value. Economic growth is concentrated in those businesses to which a "trust and commitment" approach comes naturally.

As with evolution generally, it's hard to find entities that are moving from one state to another. On the sin-face, it looks like a simple ease of inertia: most organisations are full of people who liked them as they were and so are predisposed to resist the very changes that are needed to respond to the changing environment. On the basis of a large number of observations, however, I have reached a tentative conclusion that there is a deeper explanation: namely, that the old and new models relate to the left and right sides of the brain respectively. People whose experience has been predominantly in tasks that use the left side of the brain (eg, accounting) are uncomfortable with situations that call for the right side to be used (eg, financial management).

Frederick Taylor's scientific management model was a reductionist one that was concerned with breaking things down. Creating the foundation for years of work study, for example, Taylor advocated separating tasks into their smallest possible elements, which could then be performed repetitively by unskilled labourers. His motive was to avoid having to employ skilled people who, he suspected, were too keen on keeping their knowledge to themselves.

On a broader front, presuming that the next day would be very much like the previous one, managers would analyse the past, confident that it would improve their chances of successfully managing tomorrow. Analysis is an typical left-brain activity, and it thrives on repetition, experience and knowledge. But, if the safest assumption is that tomorrow will be different, managers need to synthesise their judgments about possible futures. Synthesis is about building things up rather than breaking them down. It calls for the skills associated with the right side of the brain, which thrives on novelty, innovation and imagination.

The left side of the brain seeks certainty and single-point precision, but the right side is comfortable with uncertainty and tolerances. The left side literally cannot imagine what the right side does. Again, accountancy provides a good example: some members of the profession are so preoccupied with accounting that they mistakenly think it's financial management. Conversely, involvement in risk management demands the capacity to imagine what might happen.

The left side is driven by the need to know, but knowledge is only one subset of information and, like measurements, can refer only to something that has already happened. The right side is driven by the need to believe. Managers' beliefs about things such as what would delight customers or what impact advertising might have on the demand curve are vital pieces of information, yet are beyond knowledge. As no less a person than Albert Einstein observed, knowledge takes you only so far--all major developments have sprung from the application of imagination.

The left side of the brain is appropriate for the identification of one optimum solution to a clearly defined problem that, according to the old model of management, would persist unless action were taken to eradicate it. The right side, in contrast, is appropriate for the identification and pursuit of opportunities that may or may not be grasped.

The left side of the brain is seen as the masculine side, linking with the confrontation of the old model. The right side is seen as the feminine side, linking with the co-operative feature of the new model. As a general rule, women are seen as using the right side more than men.

It's arguable whether it's a cause and effect or not, but the fact is that, as the proportion of women in management has increased, so has the popularity of the feminine traits of caring and sharing. Time is also important here, in that the left side of the brain is tuned to the short term whereas the right side can handle an indefinite future. The relationship between a company's different stakeholders--for example, owners, employees, suppliers and customers--can seem to conflict in the short term but be harmonious in the long term.

There are other contrasts, but the above should suffice to make the point, which is that one side or the other will be more influential with regard to the management of a business. Some people will be good at tasks that are in essence left-sided, while others will be good at tasks that bring the right side into play. That is perfectly understandable but, to bring it back to our profession, I would point out to those in the accounting camp that the left-brain tasks are increasingly being de-skilled or computerised, leading to a decrease in the number of jobs of this kind. The financial management jobs, on the other hand, which demand human involvement, are growing.

David Allen CBE, a past president of CIMA, is a director of a number of private companies and an adviser on strategic financial management
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Title Annotation:Management
Author:Allen, David
Publication:Financial Management (UK)
Geographic Code:4EUUK
Date:May 1, 2004
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