In the seminal 1983 management handbook, High Output Management, former Intel CEO Andrew Grove writes, “As a manager, you are an in effect a chief executive of an organisation yourself…As a micro CEO, you can improve your own and your group’s performance and productivity.”

Maxims such as this, along with Grove’s insights on optimising productivity, efficiency and output while fostering a culture of continuous improvement, have proved highly influential in the forty years since the book’s publication. Silicon Valley royalty like Mark Zuckerburg, John Doerr, Marc Andressen and Bill Campbell are devotees of the book.

But despite the book’s influence over the last forty years, to what extent do the management and leadership principles espoused in the book hold true in 2024? More specifically, how has the role of manager and leader evolved from Grove’s 1983 definition?

Historical Shift

Historically, management was characterised by rigid hierarchies and top-down decision-making, with employees expected to follow management instructions without question. Arguably, this autocratic approach stifled creativity and hindered the development of employee potential – an approach that proved unsustainable as rapid change and new digital technologies brought unprecedented complexity and uncertainty for organisations and leaders. As such, the 21st century has seen a shift away from traditional command-and-control management style to a more “agile” approach, which prioritises adaptability, collaboration and rapid decision-making – along with self-organising teams, where the leader or manager acts more like a coach.

Precursor 

In many ways, High Output Management may be seen as a precursor to agile management techniques and a coaching leadership style. For example, Grove emphasises the role of manager-as-coach who empowers employees to take ownership and accountability for their work. And with his emphasis on measurement, Grove would surely have embraced the data-driven decision-making enabled by analytics and Big Data, along with the iterative development processes used by agile teams that prioritises customer value.

However, new IMI research suggests the book’s central tenant – maximising productivity and output while maintaining a focus on results and efficiency – is becoming less relevant for today’s teams. Or at least, heavily asterisked. While an “output-orientated approach” focuses on the output of the team or department, rather than its activities or processes as in traditional management practices, there is a growing concern this instrumentalises employees, whereby an employee-centric approach effectively becomes a means to an end.

Beyond Output

While output and performance will always be a factor, today’s employees don’t want to be reduced to a set of performance KPIs: they want to be part of an inclusive, supportive workplace culture where they, and not just their output, are valued.

Put simply, they want management and leadership teams that are people-first, rather than output-first.

And it goes both ways. Not only does research from McKinsey and the Harvard Business Review corroborate that happier, more inclusive workplaces lead to increased productivity, but the set of standards employees judge their employers on is shifting too. IMI research shows that employee well-being, job satisfaction and work-life balance currently outrank traditional benefits (salary, bonuses, job stability) for recent Gen Z graduates when deciding on job offers. This is closely followed by assessing an organisation’s commitment to diversity & inclusion and sustainability & ESG measures. Across the board, organisations are being held to a standard that goes beyond profits and revenue – be it from employees or high-ranking shareholders.

Hybrid and Remote Challenges

Bringing it back down to a people level, shifting employee needs and rapid change generally (i.e. the rise of digital technologies) has created new challenges. In a recent IMI focus group, senior managers and leaders from some of Ireland’s top technology and IT companies called out remote working as a challenge. On one hand, agile organisations should offer employees the autonomy and flexibility to work from where they feel most productive; however, it was noted that new employees were not progressing at the rate of previous office-based cohorts. Those in IMI’s focus group felt this was due to a loss of “learning by osmosis,” whereby team members soak up critical work-related knowledge by working in proximity to their more experienced peers.

Similarly, Slack’s research consortium Future Forum showed that 42% of workers felt working from home gave them fewer chances to learn from colleagues, while a recent Growth Engineering report found 20% of learning comes from simply observing and interacting with colleagues, although research from London Business School suggests that figure could be even higher.

Loss of “osmosis” learning can lead to a lack of knowledge and skills transfer, along with a business continuity gap in certain instances, as experienced employees are switching jobs in record numbers without passing down key insights that can only be gained through experience, and not from official onboarding tutorials. Measuring the performance of remote employees was also cited as a challenge.

Nevertheless, the genie of remote and hybrid working cannot be put back into the bottle: these models are here to stay, and it’s the responsibility of management and leadership teams to overcome the challenges they give rise to.

Need for Investment

IMI research shows investment in leadership development, continuous learning and upskilling initiatives are key. Not only for employees to keep pace with evolving technologies and industry trends (the OECD recently noted that Irish workers particularly at risk of falling behind due to low involvement in lifelong learning), but to develop and enhance the leadership skills, emotional intelligence and adaptability of managers – many of whom may recently have gone from being an individual contributor to managing an entire team, newly tasked with inspiring those below them and influencing those above.

Many of the principles in Grove’s High Output Management remain vital, i.e. setting clear goals, providing timely feedback and empowering employees. However, IMI has noted an overall shift beyond “high-output” management and towards High-Impact Leadership. Recognising success goes beyond productivity and profits, high-impact leadership also encompasses sustainability, inclusivity, employee-wellbeing and other societal impacts, along with the ability to build and lead a high performance team.

High Impact Leadership

While specialised knowledge and expertise in a particular field are essential, a High Impact Leader possesses the ability to engage, influence and inspire diverse teams; with the capacity to overcome personal obstacles to drive both personal performance and team performance; and capable of applying a flexible approach to creative problem-solving and critical thinking. Awareness of their own authentic leadership style is key, along with the ability to build upon those strengths. These are the principles which underpin High Impact Leadership.

Managers and leaders who remain reactive rather than proactive may not be able to support an evolving workforce. Instead we need managers and leaders who listen, coach meaningfully and communicate effectively. In a world where speed, agility and innovation must be balanced against ethical practices, managers must be equipped to build trust, get the most out of their teams and allow employees to self-direct and prosper. These are the basic tenants of High Impact Leadership.

High Impact Leadership begins 8 April 2024. Click here to find out more.