Over the years, R. Srinivasan (Srini to friends), a co-editor of the blog, has written many posts originating in his work as independent management consultant. Today we are re-posting one of Srini’s earlier posts, which we believe readers will find of great interest.

One of the first lessons in management schools is titled Principles and Practice of Management, which forms the core basis of understanding how modern organizations are supposed to be managed. However, as one gets into the real world, every student of management, and even those who do not have formal management education, soon come to realize that there is one more ‘P’ that governs the management of organizations. This ‘P’ is not formally stated anywhere; I have decided to call it ‘the politics of management’.

No management literature ever overtly recognizes the existence of this ‘P’, even though there are several euphemisms used to describe it. One of the papers I came across used a concept called ‘informal networks’ to describe this phenomenon. Here the author described how the real power structure in an organization is dictated not by the formal hierarchy, but by the informal relations individuals enjoy with powers-that-be. I first came across this when I started my career four decades ago, when I found that the PA to the MD – who also worked as errand boy for the MD’s wife – wielded unusual power over everyone in the organization, including even other directors!

Politics of management is inevitable in any organization since, by the very nature of their structure, the organizations are based on exercising power through some form of hierarchical relations between people. As we know, when there is power to be wielded, there is bound to be some form of alignment around the power structures, leading to jockeying for power and control. In a well-managed organization, such politics is effectively directed and controlled by good leadership, for the benefit of the organization. But the situation gets complicated when politics overtakes the role of management, at the cost of the organization.

As management consultant, I had several opportunities to have a ring-side view of how such politics of management works across organizations. Before proceeding further, I must clarify what I mean by ‘politics of management’. As the word ‘politics’ implies, it is all about finding ways to capture and wield power. A legitimate way of winning power is to directly bid through the hierarchical process for higher role and responsibility. However, this option is available only to a few who are good at rising up the narrowing organizational ladder to the top. For a large number of people, this path is closed for a variety of reasons; but these people still have personal ambition, arising out of a drive to wield power and exercise control.

My early years were spent working as management consultant for small and family-owned businesses. In every one of these businesses, I noticed that the business owners had one or two trusted individuals working for them for many years. While the organization brought in outsiders to man the various roles and responsibilities created by business growth, these individuals had the ear of the owners, and thereby they wielded enormous power. In some business families these persons would also belong to the community to which the owners belonged. There was nothing wrong with this model, so long as the owner got good advice, guidance and also ‘intelligence’. However, in most of the cases where I had been approached for addressing some serious management problems faced, I found that many of their problems were linked to these informal power centres misleading the owner against ‘outsiders’ who were usually professionals doing their jobs. Thus it became my responsibility to highlight this distortion to the owners, without antagonizing these informal power centres.

Subsequently, when I started working with large corporates, I found that the politics of management was in full flow across many levels. There, in several management board meetings where I was invited to attend, I saw that the different functional heads took stand on issues based on the power equations they had with the CEO. In one case, I came across a curious situation where a VP’s father was a director on the board of the firm, and he was ambitious for his son to take over as CEO. This individual systematically sabotaged the initiatives of the then CEO to set right some major problems under the direct charge of his son, the VP. One day we found the CEO removed from his job and the son elevated to that position.

In another case, we were working for a multi-unit business group. Our role was to help one of the business units going through serious problems by adopting the concept of Business Process Re-engineering. The current CEO had recently taken over as the head of this unit; he was from outside the group, with very good credentials. However, he had to report to the top management through a unit head who was a power centre himself, an old hand with the group, with the ear of the chairman. Also, there were a few employees reporting to the new CEO who also had a direct link to the chairman, due to their long association with the group. Within the first six months of work, the new CEO started turning around the unit by doggedly implementing our BPR recommendations which exposed some of these old-timers’ wrongdoings and ineptness. All hell broke lose and one fine morning the new CEO, after a year on the job, got the marching orders from the chairman. I witnessed the working of ‘the politics of management’ here at very close quarters.

However, if the CEO is a strong and focused person, he can easily deal with the negative aspects of such politics. In an MNC company, we had recommended a change in the way the sales process was handled, which effectively reduced the power structure of the regional managers. During implementation, one of the regional managers told his boys that they had to follow his instructions only, and not to bother about the new way of work approved by the MD and the top management. When the MD got to know of this, he immediately called up the regional manager and told him that he should either learn to adapt to the new model, or look for another job.

With the advent of Information Technology and the democratization of information, I had hoped that the politics of management would come down. However, I have had occasions to interact with some of the rising stars of the IT industry, and many others who had adopted IT extensively in automating their business processes. To my astonishment, I found that the politics of management, instead of coming down, is very much present – and in many cases, it is on the rise, as seen by recent crashes of global economic powerhouses. Many subsequent studies have shown that these setbacks are mostly due to management decisions dictated by political considerations, rather than correct principles and practice of management.

As I said in the beginning, this topic is never publicly discussed, but it is an undercurrent prevailing in all organizations. In India we have a saying: When two people discuss a topic, they could be friends; but when three people discuss the same topic, they would form political parties. It is in the nature of human beings to be political in their social relations. In any group behaviour, this becomes evident in how people align themselves to one group or the other. In my opinion, human beings are not capable of equal relationships. In all relationships, you either control the relationship or you get controlled – and all the more so in organizations. Late Jack Welch, the famous former CEO of GE, used this dictum as his management philosophy: ‘Control your destiny, or someone else will’ – and he did that very successfully too!

The key issue is this: How does good management practice ensure that ‘politics’ is directed effectively for the good of the organization?

[In the next post, we shall make an initial attempt to develop a strategy to achieve organizational goals in the presence of the inevitable office politics. Reader views are welcome!]