Renowned management thinker Henry Mintzberg believes we are sitting on a powder keg created by the lack of balance between the public, private and the plural sectors.
Henry Mintzberg was once called the enfant terrible of management thinking. It’s not hard to see why. The author of books like The Nature of Managerial Work, The Rise and Fall of Strategic Planning and Strategy Safari, Mintzberg has always put forth radical ideas that sometimes rub people and organizations the wrong way. He wrote his 2004 book Managers Not MBAs, a scathing critique of business schools and MBA programs, while working at a business school.
More recently, Mintzberg, the Cleghorn Professor of Management Studies at McGill University, has trained his guns on an unlikely topic: society and politics. His latest book, Rebalancing Society, talks about how dangerous the lack of balance between the public, private and the plural sector (civil society) really is.
In this interview, Mintzberg, the recipient of the Thinkers 50 Lifetime Achievement Award for 2015, talks about his new book.
Q. What events have led to this lack of balance? And where and how did we go wrong?
A. I think the United States always favored private sector forces over other forces. The US from the beginning controlled government—they talked about checks and balances on the government in the constitution, they never talked about checks and balances on corporations. So the US always tended in that direction and it built up over time, but I think the real turning point happened in 1989. In a sense, you could say that communism constrained capitalism because there was another model available that despite the American criticism of it, offered people inexpensive housing, guaranteed government welfare programs, health insurance and so on. So that kind of constrained American capitalism. When that collapsed in Eastern Europe, that just took the gloves off, took the constraints off American business. So there were just no constraints left on corporate power.
Q. The fall of the Berlin Wall in 1989 was a defining moment in history. You say that the Berlin Wall “fell on us”. How did the fall of the Berlin Wall change the world either for the better or worse?
A. It was for the better for the people in Eastern Europe, particularly in East Berlin. Obviously the fall of communism that was dominant there was terribly constraining for people and they wanted out of it. It seemed to be positive for the West, in the sense that the American perspective was ‘we won’. But sometimes winning is the curse—you win and then you discover that there’s an arrogance and a blindness about winning that doesn’t enable you to see what’s going on. That’s why I say eventually the Berlin Wall fell on us in the sense that it took the constraints off capitalism.
Q. Are communism and capitalism necessarily bad or does the fault lie in different countries’ implementation and how they go about really interpreting the concepts?
A. I don’t think bad is the right word, but I think that by themselves unconstrained by the other sectors they’re dysfunctional. I can’t imagine any situation where either one dominates that is healthy. If you look back at the US before 1989, after World War II, the public sector was very strong. People forget about the welfare programs that Lyndon Johnson introduced, they forget about the tax rates that were much, much higher in that period, especially on rich people, they forget about the much greater equity and the distribution of wealth in that period.
Q. If you look at the American system today, what are the two or three big problems you can identify?
A. There are many problems in the US—most of them revolve around the excess power of the private sector. I can talk about the income inequalities for example. They’re very unhealthy. I could talk about the corporate malfeasance, the amount of corporate corruption that’s taking place. I think the most significant thing is the legal corruption—political donations in the US are now a form of bribery, but it’s legal. Legal corruption in the US around Congress, around bribing, around lobbying is out of control and doing a huge amount of harm to the country.
Q. You place a huge emphasis on something you call the plural sector. What is the plural sector really and why is it so important?
A. Well, it’s important because when you only recognize two sectors, public and private, then you constantly go back and forth between them and have what I call pendulum politics, which is first left then right, then right then left, then left back and forth, or you have paralyzed politics where governments get paralyzed between the left and the right. It’s not healthy. If you have three sectors, then you have more of a triangulation of power and you can see better opportunities to balance. I use the metaphor of a stool that needs three legs. The American stool sits on one leg now: the private sector. The Chinese stool sits on two legs: the private and the public sectors. But Brazil, Germany and Scandinavian countries are on three legs—they sit on a plural sector as well as a public and a private sector, and they’re all strong. Nobody is going to describe the private sector in Germany as weak, but nobody’s going to describe the German government as weak and civil society, what I call the plural sector, is strong.
So if you say what is the plural sector, I can give you three different answers: one is everything that’s neither private nor public, and that means non-governmental organizations, churches, in the United States and Canada it means hospitals and universities, it means organizations like Red Cross and Greenpeace, it means social movements like we saw in Egypt or social initiatives where people try and change things. But it’s also what almost everybody I know does aside from working for a business or voting for a government—we all belong to clubs, we all have associations, we all have gyms we go to, and so on. You might’ve been to the hospital—that’s probably what I call a non-owned organization—nobody owns the hospital. You might’ve made a donation to Greenpeace—nobody owns Greenpeace. Or you might work for a co-op, which I include in the plural sector because it’s owned by members, not investors.
Q. Given our current social and political structures—governments and how they function—how can the plural sector rise to a position of enough prominence to be able to play an important role in the rebalancing? Unlike the government or the private sector, most associations and co-operatives have much less power and the movements tend to be very ‘amorphous’, like we saw in the Occupy movement.
A. That’s the question I ask myself every single day: how do you enhance the power of the plural sector. One of the examples I use was why does [Mahatma] Gandhi’s Salt March suddenly appear in 1930? Because I guess people are just getting so fed up with the British and suddenly they just got their act together, just like the Americans got their act together in 1776. So people do rise up. They rose up in Egypt but unfortunately the military just came back and destroyed it. But it’ll come back again.
Q. So how do we go about fixing a country like perhaps the US, which has gone to one extreme?
A. You start with consciousness. People have said the final stage of slavery is when you no longer realize you’re a slave, and people have to become more aware of that and that’s why I wrote the book. So that’s number one. Number two is getting active about things that people no longer want to tolerate. In Holland for example, some people in the plural sector took the government to court [for] inaction in global warming, and they won. It basically forced their government to become active in global warming. So there are all kinds of ways in which people can be clever about it. They weren’t particularly clever in the occupation of Wall Street. In fact, I always thought the occupation of Wall Street made it clear who they were opposed to in general, but they didn’t go after anybody in particular. If they had challenged certain banks for certain behaviors and humiliated them it would have been much more effective.