Management Theories 101

By Fiona Chan

STARTING work can sometimes feel like you are required to learn a whole new language.

Decades of evolving management theories have spawned a corporate vocabulary that can be difficult to understand without serious study.

You may have heard of the Six Thinking Hats, but what about Six Sigma? Do you know the Blue Ocean strategy? Can you recount all the seven habits of highly effective people?

If you are drawing blanks, this is a good place to start. Here is a primer - or a refresher - on five of the most commonly referenced management theories and strategies in the business world today.

Six Thinking Hats
IT IS one thing to look at a topic from both sides, but Edward de Bono's widely used thinking tool aims to help people examine an issue from six individual perspectives.

The theory is that by putting on different 'hats', people can move outside their habitual way of thinking. You could try putting on a 'manager hat' - another favourite phrase - but it does not have quite the same effect.

The exercise starts by donning the white 'thinking' hat, which explores neutral information and factual data on an issue. Then you move on to the red 'feelings' hat, where emotions, hunches and intuition come out in the open.

The third hat is black, symbolising caution and pessimism, and forcing people to search for possible flaws and risks in a given approach. This is followed by the opposite view: the yellow hat, for positive thinking, benefits and compromise.

The last two hats are used to round off the discussion. First comes green, which stands for creative thinking out of the box, and is often applied to generate solutions for the problems thrown up during the black hat phase. Last is the blue 'big picture' hat, which is used at the start and end of each thinking session to set objectives and measure progress.

7 habits of highly effective people
A HUGE hit when it was first released in 1989, Stephen R. Covey's book on the seven habits of highly effective people has sold more than 15 million copies in almost 40 languages. This self-help tome outlines seven principles that lead to 'interdependence' - cooperation to achieve something that cannot be attained independently.

The first three habits are designed to move people from a state of 'dependence' to one of 'independence'. They are: 'Be proactive' (take responsibility for your life), 'Begin with the end in mind' (define a vision and set goals), and 'Put first things first' (focus on your highest priorities).

The next three habits supposedly bring the reader to 'interdependence': They are 'Think win/win' (find agreements that are mutually beneficial), 'Seek first to understand, then to be understood' (don't give out advice until you have properly listened to the other person), and 'Synergise' (value teamwork).

Finally, the last habit, 'Sharpen the saw', talks about living a balanced life. In 2004, Mr Covey banked on his popularity to come up with an eighth habit: 'Find your voice, and inspire others to find theirs'.

Several other authors have put forward their own 'seven habits', with varying success.

Blue Ocean Strategy
NOW used liberally by almost every entrepreneur, the phrase 'blue ocean' originated in a business strategy book by Insead professors W. Chan Kim and Renee Mauborgne.

Mr Kim and Ms Mauborgne differentiated between red and blue oceans, the former being all the industries already in existence today and the latter referring to all the unknown market space in the world.

Entrepreneurs are advised to identify blue oceans: markets and products not yet invented, in which they can create rather than fight for demand, grow rapidly, and set their own rules and boundaries.

Six Sigma
THIS quality management strategy was developed by Motorola and has been adopted by thousands of companies worldwide, including Sony, Samsung, HSBC and General Electric.

It aims to improve processes and eliminate defects, thus saving costs for companies. The goal is to make every project 'six sigma quality', which means that for every one million opportunities (or products), there are only 3.4 defects - in other words, the process is virtually perfect.

The employees within each firm who are tasked with implementing six sigma practices are known as champions, master black belts, black belts and green belts, in order of seniority.

Tipping Point
ONE of the more recent inventions of management theorists is Malcolm Gladwell's Tipping Point, which seeks to explain why some changes take place quickly, unexpectedly and on a large scale.

The tipping point is the moment at which previously small movements gain enough momentum to become a trend. Mr Gladwell's theory is that a new idea will take hold and become successful if a few key individuals endorse it, it is presented well enough to become 'sticky', and arises in a favourable environment.

This theory is not entirely novel, but Mr Gladwell crystallised it in a best-selling book published in 2000. Some criticised it for relying on too many random examples and not being substantive enough, but it has gained significant traction in management-speak.

- ST


"A good manager is one who doesn't worry about his/her own career but rather those who work for him/her." HSM Burns

"You cannot tailor make the situations in life, but you can tailor make the attitudes to fit those situations before they arise." Zig Ziglar