The middle-management class in this country has traditionally functioned as the knowledge base supporting the physical labor of the workers. In the late 1950s, technological forces began to shift from improving efficiency to adding value by increasing the knowledge content of goods and services. As computer power became more "user-friendly," the knowledge that was once "owned" and controlled by middle management was now more readily accessed by those at the lowest levels of the organization-the laborers themselves. Where our once-swelling ranks of knowledgeable managers were once needed to supervise the laborers, today we find that knowledge resides with the worker on the production floor. Thus, we have undergone a 180-degree shift, from a time when the boss knew more than the worker, to our present era, where the worker knows more than the boss.
A prime example of this shift is found at R. R. Donnelley & Sons. Once, the operation of their color printing press required a crew of five or six people directed by a supervisor. Today, R. R. Donnelley's five-color presses are each operated by a single individual using a computer keyboard. Not only is the operator of the press responsible for production, but he or she also maintains product quality through a computer monitoring system. In this instance, as in many others, we see that technological advances have supplanted the need for a "boss."
While clearly the most profound and highly visible change effected by the distribution of computer power is the equivalent knowledge base it created for management and laborers, it has, in fact, introduced a leveling of corporate America by permanently redistributing knowledge throughout all organizations. Simply stated, the need for corporations to retain multiple layers of managers who possess specialized knowledge on a full-time basis is gone.
American businesses have been slow to recognize the full impact that the distribution of knowledge has had on traditional management structures. Even though the shift of the knowledge base from boss to worker was well underway by the 1960s, it would be masked for another two decades. In the 1960s, while the war in Southeast Asia consumed our attention, Japan and Germany were busily embracing technology, resulting in strong positions in our traditional markets for hard goods such as auto-mobiles and VCRs.
As we moved into the 1970s, roaring inflation gave American businesses the impression that they were growing in leaps and bounds, when, in fact, they were either operating flat or losing ground in the technological arena. High inflation kept dollars rising while actual growth was steady or on the decline. While we could have been developing management structures appropriate for rapidly emerging technology during that time period, we were instead caught up in trying to control inflation.
In the 1980s, we continued to be insensitive to the underlying structural change created by technology, as we focused on reaping the value of our undervalued assets through leveraged buyouts, employee stock ownership plans, and other forms of mergers and acquisitions. Given the climate, it isn't surprising that we placed little emphasis on technology as a force that would reconfigure our workplaces. It wasn't until the stagnation of the late 1980s, when the pigeons came home to roost in the form of aggressive layoffs in the middle-management ranks, that we began to recognize that the rules of the game had been changed and that, for better or worse, that change was permanent.
With bosses and workers sharing more equivalent portions of the knowledge base for the first time, multiple layers of management were redundant, triggering the major reorganizations and downsizings of corporations that left the white-collar middle managers as their major casualty. Though viewed by some commentators at the time as simply a consequence of the major LBOs, which were designed to bring efficiency to the bloated giants of American industry, we were too busy making short-term profits to properly recognize, attack, or plan for new management structures to reflect the blossoming of a knowledge-based economy. The challenge facing corporations in the 1990s is to create a culture that encourages employees to continuously enhance their skill bases while retaining their services through challenging work and not, as previously, through a blanket guarantee of lifetime employment.
