Management theory is in a dismal state. The theory that dominated business thinking from the late 1970s onwards – call it neo-liberalism for short – lies in ruins thanks to Enron and the global financial crisis. But the theory that replaced it – stakeholder capitalism for short – is proving no better.
But where can we find the material for such a rethinking? Not in the great US business schools, which are either stuck on hold in stakeholder land or determined to replace the vague rhetoric of stakeholder capitalism with the even vaguer rhetoric of “corporate purpose”.in corporate scandals. And not in the great US IT companies, which operate according to the idiosyncratic rules of the information economy .
The first problem is top-down management. A double curse, top-down management leads to the multiplication of levels of control while also transferring decision-making power from the people who have the most practical knowledge to the people who have the least. This is a problem the world over: US companies are becoming more top-heavy despite all the rhetoric about flat management.
Huillard points to the importance of two things: a common management culture and employee shareholding. Vinci is united by a collective management philosophy which emphasises devolution and empowerment. Whether that philosophy can be deployed to potential acquisitions is an important consideration in deciding whether to buy them. Some 84 per cent of the company’s employees in France hold shares in the group and 80 per cent of employees are eligible to become shareholders.
European politicians combine this obsession with the short term with a commitment to top-down management. France is more centralised now than it was five years ago; the EU is more regulation-obsessed; and the economy is more sluggish. Huillard rails against “the bureaucratic hydra” of the European ruling class that is killing the entrepreneurial spirit and consigning the Continent to the slow lane.