Last September 18th Harvard Business Review published an article entitled, “The Rise of Compassionate Management (Finally).” The text alluded to various business conferences, such as the “International Working Group on Compassionate Management,” and “The Changing Culture in the Workplace Conference.”
My interest was piqued since most of the past three and a half decades I’d worked in high-tech global manufacturing companies where of all the things you might accuse them of engaging in, “compassionate management” was certainly not one of them. In fact, my general experience was that if you weren’t doing well on what you were being measured to accomplish, regardless of how well you may have done in the past, you most likely would find yourself being shown the exit.
Traditional organizations are hierarchical, tops-down structures that are continuously pressed to improve on a number of oftentimes-conflicting metrics: Cost, fulfillment, quality, asset turnover, gross margin, top-line growth and profitability. Waste costs were vigorously attacked with a vengeance: Scrap, yield loss, expedite premiums, even second shift pay premiums. And so-called “non-value-add costs,” such as finance, human resources and MIS, were generally under-resourced and under pressure to meet company expectations nevertheless.
Now comes the “Conscious Capitalism” movement within companies such as Container Store, Google, Nordstrom and Southwest Airlines. Their belief is that stakeholders who matter go well beyond returns to shareholders. They have a duty and responsibility to their workers too. In addition, come to think of it, the responsibility extends to customers and suppliers as well.
In eight years of working at Kingston Technology I observed “Compassionate Management” utilized as a leadership style in sincerity. The owners of this $6 billion / year global manufacturer of solid-state memory, both talked the talk and walked the walk. They generally enjoyed people; they treated employees and suppliers alike almost as royalty. Interestingly they didn’t need to pay much attention to customers since the loyalties they built with their supplier base and employees around the world meant that these folks would “fall on a sword” to get done whatever the job required.
Scholars such as Peter Senge have always espoused the value of compassion within organizations, be they educational or business organizations. But the temptation to squeeze the life-blood out of supplier costs, and push your employees to continuously improve, proves too difficult to resist for most managers seeking to improve their numbers.
Which is why a business model of “Compassionate Management” can only be developed within organizations whose leaders are genuinely sincere about its implementation. From here we witness leaders hiring staff with shared values and belief systems and what ultimately evolves is an entire culture of compassionate management, complete with carrots and sticks. The ruthless don’t do well in these organizations while the loyal tend to stay on, perpetuating the compassionate culture and becoming adept in their subject matter expertise since they generally have no desire to bail out and find another company to work for.
Rodd Mann | BBA | MBA | CPA | APICS CPIM | Six Sigma Hands-on-Champion
Ed.D. Doctoral Candidate, Concordia University, Irvine, CA