In search of a purpose
A week or so before I was due to meet Charles Handy, the most horrendous thing happened: his wife Elizabeth – the life partner thanked in all his many books for giving him the courage to change the course of his life – was killed in a road accident. The interview was of course postponed; I doubted it would ever take place; I doubted, too, whether he would make the long trip to Australia to address the HR Institute’s national convention. At the best of times, such a trip would be effortful for an 86-year-old, and these were far from the best of times.
But a little over a month after the tragedy, I receive confirmation not just that Handy will be fulfilling his speaking commitment, but also that he is willing to do the interview. Indeed, he says generously that it will help him form his thoughts ahead of his speech at the convention. To carry on working is essential, he explains. Faced with such inexplicable loss, one can either give up or fight on. He has chosen to fight.
We meet at his apartment in Putney, south-west London, in the grey, somewhat forbidding building he and his wife occupied for more than 50 years. The exterior may be austere, but his flat is light, airy, peaceful. He has just finished lunch with a PR contact; his daughter lives downstairs and comes up briefly before our conversation begins. Life goes on.
Born in Ireland, his father was a Protestant vicar, and Handy once thought about becoming a priest himself, despite not believing in God (Anglicans are not dogmatic on the point). A colleague joked that he would make a very good bishop but a very bad curate, and the remark is spot on: with his balding head, stately manner and patient wisdom, I have never met anyone more episcopal. Management theory’s gain was the Church’s loss.
When we are settled, he hands me a piece of paper headed “Letters to My Grandchildren”. This, he says, is where his talk in Melbourne will begin. It is the working title for his next book, which will outline the sort of world his grandchildren – now aged 11 and 12 – can look forward to. If looking forward is the right phrase, because he says there will be many challenges and uncertainties.
Ever since his 1989 book The Age of Unreason, which foresaw the great disruption that would overtake working and social structures (the two in his view are inseparable), this is the theme he has returned to constantly. “When I was young I thought everything was fixed,” he tells me. He couldn’t have been more wrong.
Handy joined Shell as an executive straight from Oxford in the mid-1950s and thought that would be it: relentless progress up the corporate ladder before retiring on a fat pension to play golf and grow hydrangeas. Organisations were highly structured and apparently durable; career paths carefully plotted. But after 10 years, demotivated at Shell and with Elizabeth egging him on to change direction, he chucked in his executive career to become one of the UK’s first professors of management.
Similarly, the world he began deciphering in the 1970s, initially in his influential textbook Understanding Organizations (published in 1976), was also undergoing a revolution, with big companies starting to outsource in search of flexibility and some behemoths falling by the wayside because of their failure to adapt. The truth, he discovered, was that nothing was fixed.
For a decade after the publication of Understanding Organizations, he concentrated on business theory with books such as Gods of Management and The Future of Work. But the death of his father and a spell running a centre that looked at the ethical questions facing society changed the nature of his thinking. He became what he calls a “social philosopher”, asking not how organisations were structured but what was their purpose. He became interested in questions of identity – his own and that of companies, treating the latter like people who could have breakdowns, lose their self-belief, respond to psychological help.
“A company in law is an individual person,” he says, “and, if you think of it as a person, that’s actually quite revealing. They should have an identity, a persona, an outward image; they should have a purpose in life; they should be able to get by; and they shouldn’t sell themselves cheap. The Aristotelian idea that ‘You should do your best at what you’re best at for the good of other people’ applies to companies as to people.”
His message in Melbourne will be that though we don’t know exactly what the future holds, there are some straws in the wind, that “the future is here somewhere if you can glimpse it”. “I think we are going to see the progressive dissolution of institutions,” he argues. “The things that hold society together are going to fragment and dissolve. It may not look like it from outside because they will still say ‘We are Unilever’ or whatever, but inside they will be a fluctuating group of smaller networks which will come and go and not be wholly owned by anybody.”
This new working world will comprise the “three Cs” – “creatives, carers and custodians”. The creatives will be fine in our entertainment-obsessed age; the carers will have their clearly demarcated place in an ageing society; but spare a thought for the third group – the managers trying to hold this fragmenting, highly individualised society together.
“One of the custodians’ roles will be to help people navigate this world that is going to be rocky,” he says. “Don’t believe there’ll be any kind of safety in an institution. Companies can no longer afford to buy all of an individual’s time and then have the terrible bore of telling them what to do with it. They will buy an employee’s product or output instead, and work will be reshaped around that.”
Change fascinates Handy. How do people and businesses survive it, even turn it to their advantage? His most recent book, The Second Curve (published in 2015), argues that people, businesses and societies should seek to introduce radical change when they are strong and before the first curve charting their success starts to dip. That is difficult: why change a winning team, a winning formula? But that’s exactly when you have to introduce change: inside every successful person or company is a complacent failure waiting to express itself unless it embarks on its second curve. Every big company, like every empire in history, believes its hegemony will continue forever; the sun will never set. But ask Kodak (or indeed the Romans): the sun can set, the shutter can close, very quickly.
A further danger for companies, in Handy’s view, is to allow the shareholders to call all the shots. He sees shareholders not as the owners of a business, but as the suppliers of capital being rented by an organisation. The people who really matter are the managers, the workforce and the customers – they are the true “stakeholders”. He sees the privileging of shareholders from the 1970s on as a disaster, turning companies into machines whose sole purpose was to make money for shareholders, leading to the financial crash of 2007/8 and bringing capitalism itself into disrepute. Only by treating commercial organisations as organisms with a social purpose can capitalism be salvaged.
“Successful organisations run by entrepreneurs are mad keen to get their product or service off the ground,” he says, “and are thrilled when it reaches people. The fact that it makes money is an incidental result. No doubt they are quite pleased by it, but it’s not why they are in business. They’re in business because they care about what they’re doing. It was like that once but we lost it, and accountants are running the bloody place now. We need to get back to people caring about what they do and make.”
In The Second Curve, he talks about “citizen organisations”, which are based on trust rather than control and allow “tenured workers” to vote on the direction of the company to offset the power of shareholders. It is a seductive concept, though it is ironic that two types of organisation he argues companies should seek to resemble – universities and charities – have recently been beset by their own existential crises. Truly, every institution is at risk in our brave new world.
Handy believes that as the world of work changes, and structures and hierarchies fall apart, governments will face huge challenges. Who will pay taxes, for one thing, and how will they be collected? If fewer of us are employees, and we have portfolio careers and come in and out of employment, the tried-and-trusted methods of tax collection start to break down. Throw in an ageing society and greater wealth inequality, and the world’s debt crisis can only be intensified.
He has no accounting answer to that conundrum, but instead offers one of his lateral jumps to reframe the problem. “We have to rethink economics,” he says. “The old economics doesn’t answer the questions. The old thinking assumes everything can be given a monetary value, which is basically untrue. Air, water, smog can’t be given a monetary value. It also assumes everyone is a rational, calculating individual who believes that what matters most is money, but as Brexit shows people make choices not just about what’s in their economic interests but also what accords with their ideology or even what’s more fun. None of this is taken into account by traditional economics.”
He argues that the obsession with growth, as conventionally measured, has to change. One of his “Letters” to his grandchildren is entitled “Money matters but not too much”. In the past he has pointed out the absurdity of the billions generated by prostitution and drug dealing being added to GDP. The logic of that accounting method is that increasing prostitution and illegal drug use is good for the economy and thus for society. Instead, he says, we have to learn to distinguish between good growth and bad growth. Forget the wealth of nations; concentrate on the health of nations.
Handy is fond of reframing problems in this way. He also likes to ask open rather than closed questions. Schools, he suggests, get this all wrong. Thus for him the question, as he says in his chapter on education in The Second Curve, should not be “How far is it to Birmingham?” but “Why should we go to Birmingham?” Teachers traditionally like to set their pupils closed problems with proven answers that you can look up in a textbook, but life poses a series of open questions – “What career should I pursue?”, “Who should I marry?’, “What do I really believe?”, “Who is telling the truth?” – with no easy answers.
That realisation no doubt explains why he gave up writing textbooks and embarked on writing provocative ethical treatises. Stock answers hold no interest for him, which is why he dislikes being called a “management guru”. Gurus claim to have all the answers and are seeking to attract followers. He has only questions, he says, and the ones that galvanise him these days concern who we are, what we are for and where we are going. He never quite escaped the moral imperatives of the vicarage in which he grew up, and, though he doesn’t believe in God, he is still seeking the god he believes is in all of us if we can unlock it.
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