UK: Middle managers an endangered species. (2 of 4)

UK: Middle managers an endangered species. (2 of 4) - Computers, of course, are nothing new. But the effects of new technology have been slow to work themselves through the system. Many of the redundancies occurring today should probably have happened ye

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Last Updated: 31 Aug 2010

Computers, of course, are nothing new. But the effects of new technology have been slow to work themselves through the system. Many of the redundancies occurring today should probably have happened years ago and now the recession, the first since office technology took hold, is providing companies with an excellent excuse.

On top of this, though machines have been in offices for a while, in many companies the older generation of top management is not computer literate in any meaningful sense. And that probably goes for a whole chunk of computer users further down the line, who will only be using a fraction of the capability of the machines on their desks. As the new generation of computer-literate executives ascends, whole swathes of management will become superfluous.

Derek Edwards, a director at Sanders and Sidney, is firmly convinced that "we ain't seen nothing yet". He offers a simple illustration. "I haven't yet learned to use that phone. It can conference, record messages, I can have my calls transferred, I can leave messages for myself and goodness knows what else. It's been sitting there for weeks and I'm still learning to use it." The sub-text of the admission reads: "I will probably not get round to learning all the functions, but if I did, would we need quite so many secretaries?" Not the most dramatic example, but translate the phone into the computer on the MD's desk, and what does it mean to the layers of management just below?

Job losses are not the only factor. Equally important is the change in role for those people left behind. New organisational structures mean new career paths and the likelihood that people will move around a lot more. For the individual, says Reed, "it means working on their own careers as well as on their organisation".

It is a view that is echoed in many quarters and the jargon used is "taking possession of your own career" - rather than relying on your employer to do it for you. But as Sundridge Park's Pemberton explains: "People who have been somewhere all their lives don't know how to find another job. The notion of a lateral career move is anathema to them."

This was confirmed in a recent career audit of middle managers carried out by Sundridge Park for National Westminster Bank. "Attitudes have not changed," says David Strowger, assistant general manager (group personnel) at NatWest. "Our people don't see themselves as career changers. They look for further progression within the bank. I think it will take a long time for any change to get through."

This is no surprise really. Large organisations cannot change overnight even when their managements, like those at BP or BT, make thousands of redundancies. "BP management has done exactly the right thing," says one former manager. "You need a turnover of people to create the values and culture of the new company." At the same time he adds: "I don't believe a big organisation like BP can quickly become less bureaucratic."

Whether or not companies are managing their down-staffing properly has yet to be seen. Having established the need for a number of job losses, the first issue is selection criteria. If the choices are wrong, a company runs a real risk of losing important staff. "The unspoken side", says Pemberton, "is the loss of experience and how the process of transfer takes place." One former British Telecom employee suggests BT that is already having to replace people laid off in last year's giant cutbacks.

Furthermore, the actual way in which redundancies are handled - how the news is broken and the "separation package" offered - will affect the morale and performance of remaining staff. It will also influence the company's ability to recruit in future. Hoards of disgruntled ex-employees bad-mouthing a company is bad news for any employer. Whatever the current economic situation, the so-called "demographic time bomb" dictates that the battle for skills in the '90s and beyond will be fierce.

Getting redundancies right is difficult under any circumstances. But as Litchfield points out: "Managers take it worse. It's psychologically harder - a case of tea and sympathy all round. And it's important to stress that the job is redundant, not the individual."

At IBM, where 14,000 redundancies have just been announced, a pilot scheme has been set up which guarantees a fixed amount of freelance consultancy work with IBM to redundant executives. The idea is to let the company tap into the skills of long-serving, experienced staff while giving them a leg up in starting their own consultancy businesses. Arrangements like this are clearly the way forward. Interim management - executive "temp agencies" with senior people on their books - is a growing phenomenon. And being freelance or self-employed is a favoured route for many redundant executives.

In the meantime the boom in outplacement continues. Last year Focus saw an 80% increase in management counselling, according to managing director Litchfield - and other agencies tell similar stories. As Rowlinson at Sanders and Sidney predicts in his somewhat incongruous outplacement jargon: "If you take someone in their 20s today, at some time it's a virtual certainty they'll have to go through an enforced termination."

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