The Age Of Unreason

by Charles Handy

  The caring organization

  Learning organizations want everyone to learn always, and bend over backwards to make that obvious. Large do’nuts, self-development contracts, recognized mentors, outside visits and seminars, incidental learning and corporate forgiveness are part of that. So are more formal arrangements such as tuition reimbursement schemes, as found in most American companies, more opportunities to listen in on higher-level debates as in Japan, projects beyond the immediate job, the public encouragement of questions at all levels, quality circles or their equivalent in study teams everywhere, brainstorming parties around new problems, horizontal careers to open up new possibilities, the encouragement of precocity and initiative even if it may offend, rewards tied to output not to status, to performance not age, constant celebrations of achievement and, above all else, a genuine feeling everywhere of ‘unconditional positive regard’ for the individual or, in more sensible language, of care for the individual.

  Care is not a word to be found in many organizational textbooks, or in books on learning theory, but it should be. Forgiveness is not easy without that unconditional positive regard of the sort we feel for our children, no matter how much we disapprove of their behaviour. People do not take risks with those they do not trust or genuinely care for. Subsidiarity comes from more of that trust and more of that positive regard. Loose, dispersed organizations depend on people liking and trusting each other. A culture of excitement, of question and experiment, of exploration and adventure cannot survive under a reign of fear. That kind of culture cannot be imposed, it can only be encouraged by demonstrations of warmth for all that is good, by celebration, by investment in individuals beyond the bounds of prudence. That kind of encouragement is only possible if one genuinely cares for the people being encouraged.

  It is an attitude of mind and it shows in simple ways. Jim, the Manager of Indoor Recreation in a Metropolitan council in the north of Britain, has written a short description of his work for a Local Authority Competition on management. He called it ‘My Love affair with Change’. He described one incident out of many,

  ‘I should have known we were onto a winner with the staff there. They always made people welcome – even management. All they needed was attention, encouragement and freedom. But it became apparent after a meeting of supervisors of all pools.

  ‘I hadn’t been in the Swimming Session for too long and we had begun to meet regularly to talk and listen to each other (that’s the best way I could think of putting it).

  ‘The supervisors complained that they never had any money to spend . . . so I gave them £500 for each pool. The two supervisors at this pool could decide how this money was spent.

  ‘Some bought audio equipment, another bought an external sign and had information leaflets printed. The supervisors at one pool didn’t spend their money. At the end of the year they wrote to me saying the interest was worth £50 and it was to go towards their cutbacks for the year.’

  Little things and an attitude of mind – attention, encouragement, and genuine care and freedom – add up to a culture of learning, in a learning organization in love with change. It will, however, be more difficult to maintain, this culture of learning, in organizations when many people will be rather temporary inhabitants, passing through in the pursuit of their own careers. It is hard to give as much genuine care to your tenant as to your child who is yours for life. Japanese corporations, with their tradition of life-time employment at least for their core workers, made it easier to create the kind of culture and care for the individual’s growth which learning thrives on. We cannot, however, afford to go the Japanese way nor do our Western individuals want that sense of permanent commitment or bondage, and even in Japan the system is beginning to erode.

  The fact, however, that it will be more difficult in the shamrock, federal organization only means that it will not happen naturally. The learning organization has to be worked for, consciously. Most sensibly, and practically, it can start by getting rid of the blocks to change.

  These blocks can be quite effective. Organizations know them well, and use them. Rosabeth Moss Kanter studied a range of large American corporations and reported the news about change in her book The Change Masters. She came up with ten rules for stifling initiative:

  1. Regard any new idea from below with suspicion – because it is new and because it is from below.

  2. Insist that people who need your approval to act first go through several other levels of management to get their signatures.

  3. Ask departments or individuals to challenge and criticize each other’s proposals.

  4. Express your criticisms freely and withhold your praise. (That keeps people on their toes.) Let them know they can be fired at any time.

  5. Treat problems as a sign of failure.

  6. Control everything carefully. Count anything that can be counted, frequently.

  7. Make decisions to reorganize or change policies in secret and spring them on people unexpectedly (that also keeps people on their toes).

  8. Make sure that any request for information is fully justified and that it isn’t distributed too freely (you don’t want data to fall into the wrong hands).

  9. Assign to lower-level managers, in the name of delegation and participation, responsibility for figuring out how to cut back, lay off or move people around.

  10. Above all, never forget that you, the higher-ups, already know everything important about this business.

  The learning organization needs to break every one of these commandments, frequently.

  9 An Upside-Down Society

  The Upside-Down State

  WHEN EISENHOWER WAS President of Columbia University in New York, before he became President of the USA, he received a deputation from the faculty. Could he, they asked, please use his authority to stop the students walking over the grass in the main quadrangle.

  ‘Why do they walk on the grass?’ he asked.

  ‘Because it is the easiest way to get from the main entrance to the central hall.’

  ‘If that’s the way they are going to go,’ he said, ‘then cut a pathway there.’ Problem solved.

  There is, sometimes, little point in trying to stand in the way of what is happening. It is often better to recognize the inevitable and make it work for you. The changing pattern of work is one of those tides in the affairs of men and women which needs to be channelled, for it will not, cannot, be blocked or dammed. This book is not about politics, but if work is changing so much of our life so radically then it is bound also to have its impact on government and on the rules of society. Government, too, needs to recognize that the changes do make a difference, that more than a marginal adjustment is required, that discontinuity demands some re-thinking and re-framing.

  The Henley Centre in Britain, in its 1988 report on Teleworking suggests, for instance, that gasoline stations will lose business along with the railways as commuting declines, that second cars will become unnecessary, road congestion will ease and that the greater availability of time for working (without travelling) might lower the rate of inflation by 0.7 per cent. House prices might even out as people have more freedom to choose where they live and a lot of office cleaners would lose their jobs.

  All that however is only the tip of the iceberg. The implications go much deeper than the possible effects of telecommuting. For the past 100 years and more the work organization has been of great use to governments of every political persuasion. The organization has been the way in which wealth has been distributed to the population, in their wage packets or salary cheques. The organization has been, therefore, the natural and convenient way to collect taxes and to implement economic policy and to plan resources. If everyone has a job in an organization then the world is easier to control. At the very least we know where most of them are, and where most of them will have to live.

  Similarly, organizations have been the easiest route for spending government money. It is easier to pay hospitals to help sick people tha
n to pay the sick to find the hospitals, easier to pay schools or universities en bloc than to pay individuals to go to the schools, easier to run your own railways, coal mines or postal services than to leave it to others. Of course, there are ideological reasons for keeping vital services in government control but it cannot be completely accidental that the enthusiasm for governments to own and control so much coincided with the same fashion in organizations everywhere. ‘If you want to control it, own it’ was the message in every business in the 1960s and 1970s. Integration was the smart word – horizontal integration, vertical integration or both together. Buy your suppliers, buy your customers, buy your competitors if you can. That way your world is more yours. It was only natural that governments should hear the same message.

  It was, as we have seen, an expensive message. Organizations now think differently. Shamrocks and federations are more economic even if they are more difficult to control. The new fashion will not leave governments unscathed. They, too, will find that it makes sense to work out their core tasks, to do those well with the best people, and to contract out the rest for others to do. To call this privatisation is to miss a large part of the point. It is not all, or perhaps even mostly about ideology, it is about the most effective and efficient way to run organizations. The shamrocks of the state may be expected to spread for quite a while, nor will it be easy to reverse the trend.

  More fundamental, however, is the way work is moving outside the organization. More fee work, more telecommuting, more self-employment makes it more difficult for the government to collect prices, influence earnings or manage welfare. Self-employed people cannot by law or logic be unemployed, only broke. Nor do the self-employed ever really retire, they only slow down. Unemployment and retirement begin to be technical terms only, not ones that usefully describe the human condition. So it is that a government can proudly announce a fall in unemployment while the opposition may simultaneously claim that the real number of people wanting work is rising. They are talking about different things. Inevitably, now, government will have increasingly to deal direct with individuals rather than with organizations, will have to re-think the categories it puts people into, and find some new ways to organize the collection and distribution of wealth if the organization cannot do it for them. The time of discontinuous change needs some upside-down thinking.

  The shamrocks and federations of the state

  The British Civil Service is devolving a large part of itself into agencies. Railways may become Track Authorities, with private companies running competing train services along those tracks, rather like an Airport Authority. The BBC may be whittled down to a centrally funded news service with all other programmes contracted out to small documentary and film companies. The mail service in each country may be confined to the main track routes between big cities with franchisees bidding for the right to deliver the mail to our doorsteps, or more likely, to our private box numbers.

  It could go farther still. In the USA prisons are put out on private contract, rather like security for the plant. Maybe parts of the defence contract could also be subcontracted. Schools, as we shall see, could become brokers in education, the intermediaries between leavers and a whole range of potential suppliers. Motorways and inner city streets could all become toll roads with automatic charging from strips in the road to meters in every car, allowing individual businesses to bid for building and running roads and motorways.

  These are the signs of the principles of subsidiarity and the inverted do’nut creeping into government. Governments are doing what organizations are doing – re-thinking their core function. It should be no surprise that they often conclude that it is the job of the core to set and to maintain standards, to establish a framework and to choose the contractors but not to try to do the job themselves. If business organizations increasingly find that what they can most usefully do is to identify the essential core of the do’nut (the standards), to define the outer rim of discretion (the framework), to select the people, and to leave the rest to their individual initiatives, then governments will in time follow the fashion and start to do likewise. They already are.

  They will not, of course, pay tribute to organizational thinking when they start to reform their ways. That would be unnatural. They will claim it always as a victory for their particular brand of politics for it is not difficult to make organizational effectiveness an essential plank in the political philosophies of either left and/or right. What today is called ‘privatisation’ to emphasize the diminished role of government as operator, could equally well be called ‘democratization’ to emphasize the return of choice to the client or consumer. No doubt in time it will be called just that. In the meantime I shall continue to believe that the laws of organizations are ultimately inexorable.

  A National Income Scheme

  Education is critical if we are going to give more, if not all, of our citizens the ability to work and live in this new world. But education on its own will not be enough. We have to find other ways of ‘empowering’ people as individuals. A national income scheme is one possibility.

  The national income is conventionally the income of the nation as calculated by the statistical service. Upside-down thinking suggests that it ought instead to be defined as the income which every citizen should receive from the state. The idea has been around for a long time and has been given various names – a social wage, a national dividend, a citizen’s salary, a basic income, but it has never been thought practical or, indeed, necessary as long as most people were guaranteed their income through their job.

  Things are different now. People lose their job through no fault of their own. Ten per cent of the working population with no paid work at all is a lot of people. Others do not get included in the ten per cent but are still impoverished, like many of the self-employed. In order to get financial support from the state you have to classify yourself as old, unable to get work or poor. It is demeaning, people feel, in a free society.

  A free society, and a rich society in comparative terms, ought to be able to guarantee its people enough money to pay for food, clothes and heating, as well as the free education and free health care which it already gives them. Upside-down thinking suggests that instead of paying cash to the needy few we should pay it to everyone and then claw it back progressively for those that don’t need it.

  Put more idealistically the argument is that as citizens we are both entitled to an income from our collective property, our society, as well as obligated to pay a portion of our individual earnings for the maintenance of that society. All of us have the entitlement and the obligation.

  It would work like this, at its most simple. Everyone would receive a weekly or a monthly income from the state. It could be smaller at 16 and 76 than at 36 or 46, to match the changing curve of spending. That income is never taken away from you, you do not lose it when you start earning – the penalty under the present system which discourages so many unemployed from re-entering the labour market. Instead you start to repay it when you start to earn. That repayment tax might start at 60 per cent and would then fall, not rise, as you earned more, giving even more incentive to keep on working. The repayment scheme would be in addition to income tax which would not, however, normally start to bite until the repayment tax was very small.

  The results might be interesting:

  — Because everyone would receive the national income there would be no need for people to classify themselves as unemployed or retired in order to get money. Those words would simply disappear, and with them the categories of people. More people would just be living off their dividends as the people of property have always done. Now anyone could do it, in a small way.

  — Because the national income, although very basic, would cover essentials, it would make sense to do some extra work quite cheaply because one would keep about half of it. The marginal cost of labour would therefore tend to fall, more jobs would be worth doing, we should start to price some work back into existence, partic
ularly at the low-skilled manual end where it is most needed.

  — Because there would be more money circulating at the bottom end of the income scale there would be more consumers; therefore, in the end, more work making and doing the things those consumers want; (if we don’t import them all of course).

  There are problems, of course. Giving money to people does not necessarily mean that they will spend it sensibly. Some will waste it on booze, drugs or horses and still come to the state for support. Hopefully, they would be a small minority but they would be there and something would have to be done for them by someone. Would we consider that they had any further call on society, or would we leave it to charitable organizations to help any who cannot help themselves?

  It would be hard to get started. This excuse is often made but I am not convinced. It is, after all, only the same amount of money being circulated in a different way. It would help if it were done in conjunction with the next piece of upside-down thinking.

  Zero income tax

  Upside-down thinking goes beyond a truly national income. Why have any income tax at all? It only raises the cost of labour and therefore the cost of the product and so ultimately helps to price more work/jobs out of existence.

  Income tax has been, of course, the easy way to collect taxes, even though it was originally introduced as a temporary measure. It won’t be easy for much longer when only half the working population and less than 20 per cent of the total population will be on the permanent payroll. Self-employment tax is much more difficult to assess and to collect and will get more so as more people become self-employed.