Management Fads

Professor Bainbridge comments on management fads and why they take place.

The proliferation of management fads is hardly surprising from the supply side. Like the fashion industry, the management consultant industry always has to have something new to sell. There must be continuous churning of ideas if the consultants are going to have continuous work. After all, you don't become a management guru with lucrative consultancies, huge speaking fees, a bestseller if all you can say is "everything's great." But whence comes the demand for these new fashions?

Is it possible that rational managers would chase fads? Herd behavior, which refers to the tendency to imitate the actions of others, ignoring one's own information and judgment with regard to the merits of the underlying decision, provides an answer. Corporate managers are scarcely immune to herd behavior; to the contrary, the faddish aspects of participatory management suggest the possibility that herd behavior is relevant to the demand side of the equation. An American Society for Training and Development report, for example, observed that many companies adopt team-based management structures, inter alia, "in response to success stories from other companies." (For the citations, see here). Another study reported: "In a number of cases we studied, the CEO of the company had seen a TV program or read a magazine article praising quality circles and decided to give them a try." I love that one.

I think that's true, but I will point out one thing that Bainbridge didn't. Most of these management fads have at least some small kernel of truth to them, and you can usually learn a little bit from each one. But overall I prefer situational leadership, because you can't take one management fad and apply it to every problem.

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