Beyond Human Scale

As larger corporations become more and more diversified, possible under-utilization of personnel may occur. As a result, morale of managerial personnel can suffer. The problem of under-utilization must be addressed, for the large corporation’s survival hinges on effective use of managerial personnel.

The authors pinpoint the contributing causes of under-utilization, including (1) the “cushion,” an accumulation of profits promoting an atmosphere of security, (2) management information systems (MIS), a system of control used by management, (3) performance appraisal system, (4) divisionalization of a company, and (5) the actions of the chief executive officer, or CEO.

Ginzberg and Vojta examine the theory of the firm throughout the decades as well as changes in the composition of the human resource pool. Theories examined include those of Adam Smith, John Kenneth Galbraith, Joseph Schumpeter, and Thorstein Veblen.

The authors propose several solutions to the problem of under-utilization. The CEO must be thoroughly aware of the company’s position in the economy and ways of improving corporate performance; hiring procedures and policies should be reevaluated; performance-appraisal systems should be improved job; responsibilities for recruits and junior managers should be thoughtfully prepared and assessed; and alternatives to the idea of lifetime employment with one company should be designed.

Since the resource pool is made up of distinct individuals, the authors conclude that these individuals’ needs for growth should not be neglected by the large corporation. Problems often arise in the corporation when career goals of individuals and corporate objectives conflict.

Ginzberg and Vojta’s work is an important one and should be consulted both by business specialists and by general audiences. Especially valuable are the numerous case studies.