As much as we lionize corporate managers as ‘noble warriors of capitalism’, Business Technology’s resident U.S. blogger Keil Hubert suggests that the nature of large companies makes managers more like yipping domesticated dogs.
Businesses of a certain size could stand to learn a lesson or two from dogs. Actual dogs – as in canis lupus familiaris – also known as the barking, shedding, slobbering, four-legged friends that us humans domesticated ‘round about 40,000 years ago. Dogs. If you’re not seeing the immediate connection between a hound and a mid-level manager, here’s what I’m on about:
I met up with one of my old squaddies this week. We’d served in the same unit together before I retired and he mustered out. We’d both gone back to corporate careers in the IT sector, and we’ve kept in touch over the years. I was eager to trade stories about funny office happenings, and my mate didn’t disappoint. During our discussion, we got on the subject of why he’d chosen to leave his previous employer – I’d heard that he’d picked up an amazing job with a great title, great pay packet, and strong benefits. I was curious what had inspired him to punch out.
‘In the end,’ he mused, ‘it wasn’t the work so much as the culture. It was nearly impossible to get things done. Every time our team had to interact with another department, we’d get unnecessary resistance. People went well out of their way to never take responsibility for anything – the managers would all be quick to claim dominion if it meant saying “no”, but never if it involved saying “yes” to something.’
I agreed completely with what he said – I’ve experienced the exact same thing at dozens of companies over the years.  There’s a tipping point that inevitably appears whenever a medium-sized company evolves into its large company form: once a company reaches a certain size, the mid-level management employees’ incentives and disincentives permanently change into an inherently counter-productive system of corporate governance.
In a small business, every employee holds some level of authority – either formally defined by one’s position or assumed by one’s area of expertise. That shared authority model largely carries over as a small company grows into a medium company, with one notable exception: whereas almost all of the employees in a small company normally hold some authority and power, that same company’s expansion into its next incarnation involves hiring people into positions where the fundamental nature of their roles requires them to hold little-to-no power.
Therefore, the dynamic between workers fundamentally changes: in a small business, (nearly) everyone on the payroll has influence because everyone performs a required role. In a medium business, power isn’t diffused evenly – instead, it becomes concentrated into a definite management caste. The company changes to have a clearly distinct powerful group and an equally distinct powerless group. We often use the sobriquets ‘management’ and ‘labour’ for this distinction, but there are many different ways to differentiate the ‘haves’ and ‘have-nots’. The core takeaway is that over a certain size, you can no longer assume that any given person on the payroll has a voice in the company’s affairs.
Note that I’m not saying that this is somehow an inherently ‘bad’ situation; it’s perfectly normal. As organizational dynamics go, it can work well for most any company – when it’s properly led.
The thing is, I’ve encountered a common misconception among corporate managers that the only difference between a medium-sized company and a large company is the attainment of a new threshold in employee count, EBIDTA, gross revenues, or position on the Fortune 500. I believe strongly that the key difference between a medium-sized and a large company actually lies in their essential power dynamics: in a medium-sized company, you can generally tell who holds power and who doesn’t. The supervisors, managers, directors, and executives all have clearly-defined domains and are held responsible for what happens under their sphere of authority. When you become a large company, however, a curious aspect of organizational evolution removes that essential attribute of accountability from your culture.
Yes, I’m getting to the part of the argument that involves learning from dogs. Trust me.
A large company – as my squaddie and I agreed – is unique because the attribution of authority, responsibility, and dominion in a large company tends to dissipate. It becomes commonplace to have multiple people or offices contesting authority over a given process; in a company with a tens of thousands of employees, it’s comically commonplace for well-meaning executives to create wholly redundant workgroups with the exact same remit, oblivious to the fact that one or more parallel teams already exist, chartered to perform the exact same function. Mayhem inevitably ensues.
Further, the diffusion of responsibility and the difficulty penetrating a large company’s labyrinthine power structure usually erodes managers’ sense of confidence and their willingness to embrace risk. In a small company, every decision made involves risk – when you’re living contract-to-contract, everyone has to pull together to keep the business afloat. In a medium-sized company, domains are clearly defined, and someone always ‘owns’ the risk for a given function – when it’s solely your name on the blame-line, you actively take responsibility for managing the risk assigned to your ‘silo’. In a large company, however, risk is so diffused among so many ill-defined offices, departments, campuses, lines-of-business, and partnerships that it’s nearly impossible for any one non-executive to ever be held wholly-responsible for anything. Therefore, the behavioural imperatives for managers change – instead of embracing responsibility and actively taking ownership for a function, process, or result, the mid-level manager becomes strongly incentivized to evade any trace of responsibility.
This syndrome gets much worse when the company is large enough that it’s (somehow) going to make money no matter what any given arm of business fails at. Once it’s clear that there’s nothing to be gained – and everything to be lost – from accepting risk, most people in leadership roles in a large company will actively do everything that they can to escape attribution up until the opportunity arises to seize credit for a success. Managers become like jackals: cowardly scavengers, skulking at the fringes of the fray, refusing battle and only emerging to filch scraps from the wounded.
That’s one reason why I chose a canine analogy for this story. The other reason was because this concept is fairly easily argued to American businessmen and -women thanks to our post-war obsession with suburbs, and how the change in how we all lived also changed our relationship with our dogs. If that sounds crazy, bear with me for a second. One more point of perspective, and we’re there.
Prior to World War II, most Americans lived in multi-generational homes, in either urban or rural environments.  After the war ended, the American industrial community had tremendous investment in war matériel production that wasn’t needed anymore – but companies’ profits depended on continued factory output. So, the USA shifted focus from exclusively weapons production to weapons and consumer goods production.
Advances in consumer technology (like air conditioning) meant that there were suddenly fabulous new gee-gaws for the working consumer to lust after. ‘Personal success’ meant owning a new car, a new electric refrigerator, a television set, and so on. In order to further boost consumption, advertisers and manufacturers created the myth of the ‘nuclear family’, and promoted the notion that a man wasn’t truly a success until he and his family lived in their own home, away and apart from everyone else – that’s how the suburb of Levittown, NY became the new model for American aspirational mobility. It’s also how we got individual backyards. You don’t have ‘backyards’ on a multi-acre country farm or in a bustling metropolis.
We’re still obsessed with suburban living in the USA, even though we’ve long since figured out that they’re inefficient, alienating, and generally corrosive to social cohesion. They’re what we’ve become accustomed to as the ‘normal’ way that middle-class people should live. With this suburban lifestyle have come some (relatively new) social norms. For example, owning pets (dogs in particular) is still popular… dogs have been popular in America since the early colonial days. The nature of suburban living, however, means that you can’t simply let your pets roam free outside of your house, lest they venture into a neighbour’s plot and cause offense.
That’s the golden rule of American suburban living: the narrow strip of grass separating you from the home on either side of yours may as well be a shark-filled moat keeping your neighbours safely estranged from you. It’s distressingly common to never learn your neighbours’ names, since the majority of families don’t socialize with others outside of their very small set of social circles (e.g., school, work, church, and sports activities, in that order). The odds that your next-door neighbours’ interests and activities actually overlap yours on the Venn diagram of life are low – it’s perfectly normal to go to great lengths to avoid them. 
That why our dogs in suburbia – which need to regularly frolic out of doors – are generally restricted to only roaming one’s fenced-in backyard. They don’t get to simply wander the block. They also don’t get to stay out all night barking at the moon – that might annoy the other families in the region, and the highest virtue of a good American suburban neighbour is to never intrude on another family’s privacy. So, we’re left with communities chock full of cheerful canines that each have a clearly-defined domain of about a sixth of an acre that they command. They’re fenced in – but everything inside that fence-line is theirs! If you come inside a dog’s yard, he or she is allowed to bark to their little hearts’ content.
A huge downside of living that way is that suburban dogs don’t get to socialize with the other dogs in the neighbourhood. That goes inherently against their biological nature – dogs need to interact with other dogs in their environment to work out pecking orders, build familiarity, play (especially), and generally work out dog-to-dog relationships. Knowing that there are other dogs living nearby (by sound and scent) tends to aggravate suburban dogs. At best, they might become ‘friends’ with the dogs in the adjoining yards – but never get to meet the dogs living just a few houses down. That leaves them perpetually on-edge, quick to react defensively, and conditioned to fear the unknown.
Managers in a large company instinctively act like suburban dogs in several respects: consider this passage from Wikipedia’s entry on ‘leadership, dominance and social groups’ on the ‘dog behavior’ page:
‘Domestic dogs appear to pay little attention to relative size, despite the large weight differences between the largest and smallest individuals; for example, size was not a predictor of the outcome of encounters between dogs meeting while being exercised by their owners nor was size correlated with neutered male dogs. Therefore, many dogs do not appear to pay much attention to the actual fighting ability of their opponent, presumably allowing differences in motivation (how much the dog values the resource) and perceived motivation (what the behavior of the other dog signifies about the likelihood that it will escalate) to play a much greater role.’
Now translate that same passage into corporate parlance:
‘Mid-level managers appear to pay little attention to relative department size, despite the large budget and headcount differences between the largest and smallest individuals; for example, department size was not a predictor of the outcome of encounters between managers meeting while being cross-functionally aligned for a project by their executives nor was department size correlated with managers of functionally-constrained groups. Therefore, many middle managers do not appear to pay much attention to the actual fighting ability of their opponent, presumably allowing differences in motivation (how much the manager values the resource) and perceived motivation (what the behavior of the other manager signifies about the likelihood that it will politically or personally escalate) to play a much greater role.’
You can take the new manager out of the MBA programme (like you’d take a hound out of the forest), dress him up in fancy clothes, and call him civilised, but the hard-wired nature of his biological programming remains. While a small number of people (or dogs) can effectively work together, they can establish relative dominance through social interaction, play, and the occasional spat, that natural inclination is thwarted and suppressed when you segregate and isolate managers from one another.
When you separate hundreds or thousands of people (or dogs) into constrained environments (like a suburban yard or a private office) where they’re aware of others like them – but are rendered unable to interact – their inability to act according to their essential nature makes them increasingly anxious. They grow skittish, unsure of where their boundaries lie. They reflexively bark at strangers – considering any newcomer to be a perceived threat to the security of ‘their’ tiny (and largely inconsequential) domain. They feign anger and bark to scare the unfamiliar other away, but they then run inside and cower behind the curtains at the first sign of aggressive resistance– not coming out to fight for ‘their’ domain until and unless they perceive that the invading party to be weakened or otherwise defeated. They lack the perspective to selflessly coordinate with others towards a harmonious order; their ‘world’ is a frighteningly small segment of an incomprehensibly vast whole.
This is why, I argue, that the natural tendency of large businesses to isolate managers from one another and to suppress their natural urge to establish relative dominance through nonlethal aggressive conflict is inherently self-defeating. The mega-corp becomes to its managers what the vast American suburbs are to dogs: confused, isolating, and hobbling. The diffusion of accountability in the environment inspires lots of reflexive bluster, but little meaningful cooperation.
That, in turn, is why large companies often tend to evolve into inefficient, bloated, self-destructive, and chaotic. Managers focus more on fighting rival internal teams than on cooperating to defeat their competitors in the marketplace. Customers’ needs become less important than the scramble for temporary political gains. ‘Success’ gets operationally defined as the crippling of a weak rival, rather than as the creation of a new product or service. The players focus inward, more afraid of one another than of anything else.
A great executive understands this and takes active measures to redirect man’s inherent nature; a middling executive can’t be bothered to deal with it… because usually the company is so large that it’ll succeed in spite of its counterproductive and self-destructive nature. That’s why we still have suburbs full of anxiety-ridden barking dogs, and also why we have large companies overrun by anxiety-ridedn, Dilbert-ian buffoons. We could do something about it… but we usually can’t be bothered.
 I’ve consulted to a lot more places then I’ve been employed by, which gives me a useful perspective on the problem.
 If you’re interested in the sociological aspects of this story, I strongly urge you to read Stephanie Coontz’s book ‘The Way We Never Were: American Families And The Nostalgia Trap’. It’s an absolutely fascinating glimpse into the myths that we Americans tell ourselves about who we think we are and how we came to rationalize it.
 Also, possibly fear or resent them.
Keil Hubert is a retired U.S. Air Force ‘Cyberspace Operations’ officer, with over ten years of military command experience. He currently consults on business, security and technology issues in Texas. He’s built dot-com start-ups for KPMG Consulting, created an in-house consulting practice for Yahoo!, and helped to launch four small businesses (including his own).
Keil’s experience creating and leading IT teams in the defense, healthcare, media, government and non-profit sectors has afforded him an eclectic perspective on the integration of business needs, technical services and creative employee development… This serves him well as Business Technology’s resident U.S. blogger.