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The BS Factor

THE TRUST FACTOR: LIBERATING PROFITS & RESTORING CORPORATE VITALITY By John 0. Whitney, McGraw-Hill, $22.95, 235 pp.Can corporate bureaucracy and …


Can corporate bureaucracy and the waste it propagates be eliminated simply by empowering employees and placing more trust in them? That’s the thesis of “The Trust Factor” by John 0. Whitney, a professor at Columbia University’s Graduate School of Business and director of the W. Edwards Deming Center for Quality Management.

Writing in a blunt style befitting the subject, Whitney tackles a range of concepts he says lead to mismanagement-all stemming from mistrust. These include the idea that subdividing a company into separate profit centers boosts the bottom line, the fabrication of short-sighted production goals and unrealistic budgets, meat-cleaver downsizing, and the growth of corporate bureaucracy to administer itself. On the corporate side, the author takes to task such corporate giants as General Motors and AT&T, but Congress, trade unions, and even business schools are also fair game. He draws abundantly on Deming, but before he’s through, he winds up citing Aristotle, Henry Ford, Erich Fromm, and Charles Darwin.

Whitney offers insight into bureaucratic follies and the dehumanizing, dysfunctional dangers they engender. Because it’s been many years since my stint at Ford Motor, I had almost forgotten all of the wrinkles in this corporate song-and-dance. However, Whitney stumbles in positing employee empowerment as a panacea. At times, he suggests the fluid quality of business makes it completely unmeasurable, and he ignores almost completely the issue of personal accountability. If one extreme is mistrust that leads to hierarchy inside corporations and a dense web of laws and over regulation outside, surely another extreme is trust at any cost. To restore our corporations to health, need we allow employees to set their own working hours, pay scales, and production targets?

The subject might benefit from a lighter touch. In my experience, most employees quickly assess the corporate follies for what they are and face the teeth of the system with a humorous cynicism. Meanwhile, the real danger-illustrated by Ford in the 1960s and 1970s-is that the effort required to beat the system takes employees’ eyes off the real objective of any company: to provide quality products and services. That slip-up helped lead to Detroit‘s trouncing two decades ago.

Still, I recommend the book, particularly to younger CEOs, if for no other reason than that it might help them to avoid repeating some of their predecessors’ missteps. I trust this is a prescription for progress under any management system.

Donald N. Frey is a retired chief executive of Bell & Howell, former vice president of Ford Motor, and a professor of Industrial Engineering and Management Sciences at Northwestern University‘s Robert R. McCormick School of Engineering and Applied Science. 

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