Management Basics: Chapter 1 – Staff vs Management, Why the Peking Univ Grad Fired by Huawei Wasn’t Wrong

The first prerequisite for managing this issue is to recognize a fundamental fact:

Is there a management model or set of institutional standards that can be universally applied?

The answer is no.

Every company, business model, and operational process is unique. Because workflows differ and the realities of corporate development vary, management—which exists to regulate and steer business progress—must adapt accordingly.

Therefore, as long as a business hasn’t hit its ceiling and stabilized, its management model will evolve alongside the company’s growth. In other words, it must keep pace with the enterprise’s development stage. Only businesses that have reached a stable state—or perhaps even touched their ceiling—can rely on a relatively standardized management model. Most companies, however, never even get close to that ceiling before failing. (In every industry, companies constantly patch and update themselves as they grow in order to respond to environmental changes.)

Should management focus on processes or on people?

A couple of days ago, I had dinner with my boss, and he shared something he’d learned from shareholders: management boils down to two key levers. Grasp just one, and you can get things done; try to grasp both, and you’ll exhaust yourself and grow resentful.

Those two levers are: manage the people, or manage the results of the work?

I’m still not entirely clear on the specifics of each approach, but two examples can help illustrate the difference.

1. In Zong Yi’s explosive-growth venture model, management fully unleashes employee creativity—similar to Tencent’s internal horse-racing mechanism today.

2. Consider manufacturing, such as P&G’s production plants. Managers there focus on output results: if results fall short—if machines are constantly down or your output lags behind the average—then your execution and responsiveness are inadequate, and you’ll be replaced.

These two models roughly represent the distinction between managing people and managing outcomes. Tencent relies on talent creativity to develop new products; P&G relies on output volume to harness economies of scale and drive down marginal costs.

Tencent’s most impressive achievement over the past decade has been WeChat—and one hit like that is already more than enough.

By the way, KPIs are all about measuring results.

If you want to change the world, you need to be willing to invest resources into innovation, much like Tencent and Zong Yi. Otherwise, stick to the rules and manage by KPIs.

Should management prioritize fairness or equality?

In reality, no one’s salary is identical; but production-line workers’ pay is basically the same.

Why?

Differing salaries mainly stem from information asymmetry and the need to take responsibility for outcomes. Workers on the same manufacturing line receive equal pay because their tasks are repetitive and mechanical—they simply need to repeat the same actions to get the job done, with little need to account for results.

Does demanding equality mean being willing to take responsibility for outcomes? Can you shoulder that responsibility? Should suggestions from someone who doesn’t understand the full picture of the company or its operations be adopted? Those Peking University graduates laid off by Huawei didn’t deserve any less.

For the sake of political correctness, we say we should respect employees and pursue equality. But in practice, that’s not how it works. People who can take responsibility for results and outcomes deserve more compensation. Different people do different jobs, carry different responsibilities, and receive different levels of authority—that is fairness.

Put yourself in their shoes: why should the person who must bear responsibility for failures receive the same pay as someone who bears none?

(Before asking for more when you’re moving up, ask yourself first: Are you willing to take responsibility for results? If things go well, will you own the outcome? If things go poorly according to your approach, will you cover the losses? If you can’t do that, just accept your fixed salary, execute as directed, and avoid overthinking—it requires no authority and no responsibility.)

So, are employees more important, or is management more important? Should you listen to suggestions, to employees, or to management?

This article is referenced from: https://mp.weixin.qq.com/s/6wsiS6NNu–t6fca6v7Zzg

Author: Liu Shuang

Published at: http://renzhishengji.cn