# Toward a New Paradigm of Management

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> Source: Bahá'í Library Online (bahai-library.com), curated by Jonah Winters. Used by permission of the curator. Original citation: George Starcher, Toward a New Paradigm of Management, bahai-library.com.
> ──────────────────────────────────────────────────────────────────────
> 
> TOWARD A NEW PARADIGM
> OF MANAGEMENT
> by
> 
> George Starcher
> Revised May 1997
> 
> European Baha’i Business Forum
> © George Starcher 1991
> revised 1997
> 
> All rights re s e rve d
> 
> ISBN 2 - 911423-05-4
> 
> Published by :
> European Bahá’í Business Forum
> 45, rue Pergolèse
> 75116 Paris, France
> INTRODUCTION
> 
> Do business leaders and managers live by a different code of ethics than
> doctors, lawyers, politicans, and other professionals in society?
> 
> The press is full of stories of greed, self-aggrandizement, lust for power,
> corruption, and dishonesty. Yet, there are forces at work that create powerful
> motivations to change this behavior and there is increasing evidence of a
> potentially dramatic shift in both the values of business leaders and the
> practices of management.
> 
> The basic proposition of this article is that we are on the brink of a shift
> in the paradigm of management. If this is the case, what will characterize
> the new paradigm?
> 
> This paper explores some of the forces and changes underlying the new
> paradigm, offers some relevant Bahá’í concepts which will inevitably influence,
> and in fact provide the philosophical basis for, this paradigm shift. It then
> describes the possible characteristics of the new paradigm of management.
> 
> This exploration is organized in four sections:
> 
> A. The Paradox : Divergence or Convergence? . . . . . . . . . . . . .                        5
> 1. Present confusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . .         5
> 2. Forces at work . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      7
> 3. Promising signs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .       9
> 
> B. A Bahá'í Perspective on this Paradox . . . . . . . . . . . . . . . . . . .               13
> 
> C. Some Relevant Bahá'í Concepts . . . . . . . . . . . . . . . . . . . . . . .              15
> 1. Macro-economic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .          15
> 2. Enterprise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    16
> 3. Individual . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    17
> 
> D. A New Paradigm of Management . . . . . . . . . . . . . . . . . . . . .                   21
> 1. What is a paradigm? . . . . . . . . . . . . . . . . . . . . . . . . . . .          21
> 2. New paradigm of management . . . . . . . . . . . . . . . . . . .                   24
> 3. Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .   28
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> A. THE PARADOX :
> DIVERGENCE OR CONVERGENCE ?
> It has been said that the spirit of our age is fraught with paradox. On the one
> hand, business ethics seem to be eroding and the question is being asked,
> "Why be honest when honesty doesn't pay?" On the other hand, there are
> encouraging signs of a new sense of moral responsibility emerging. In which
> direction are we heading?
> 
> A - 1 DECLINE IN BUSINESS ETHICS
> 
> The profile of business leaders that emerges from the press, television and
> public opinion polls in Europe and in the United States is one of egotistical,
> greedy, power-hungry men with lavish standards of living and unreasonable
> compensation levels:
> • 82% of Americans believe businessmen are predominantly
> motivated by greed. Harris poll
> • "I think in our society we have sort of reduced ourselves to
> an equation where net worth equals self worth." Richard Darman
> • Many CEO's are bureaucrats obsessed with exercise of
> power." Carl Icahn
> 
> This image is reinforced by daily headlines in the press about top executives
> that have been involved in some form of illegal behavior. Increasingly,
> corruption and conflicts of interest are being denounced by the public,
> exposed by the press, and prosecuted by the magistrates. A wave of high-level
> corruption investigations has rocked Europe’s boardrooms and government
> offices. The jailing and indictment of many business leaders and politicians in
> Italy, Spain, France and Japan presage new standards of behavior as well as
> further indictments of white collar crimes throughout the world. In Germany,
> some estimates of the annual cost of corruption in government contracts run
> as high as fifty billion Deutche Marks.
> 
> Other examples of unethical management practices abound:
> • Discrimination in employment policies and practices.
> • Business involvement in illegal financing of political parties.
> • Manipulation of share prices, insider trading.
> 
> However, business leaders are not alone in this decline. There is also
> a clear erosion of ethics in other professions: accounting, advertising,
> law, consulting, medicine, and in government. According to Transparency
> International, a non-governmental organisation fighting corruption in
> international transactions, most major cases of bribery and corruption occur at
> the interface between government and business, not between businesses.
> 
> In addition to the decline in business ethics, two other potentially momentous
> trends preoccupy futurists, business leaders, and concerned citizens. The first
> of these trends is the increasing social injustice and gap between the rich and
> the poor, the north and the south. Capitalism as we know it cannot survive
> unless this explosive trend is reversed.
> 
> The second trend is the degradation of our environment and increasing
> concern about the sustainability of life on our planet. The quality of life of
> future generations has already been seriously compromised.
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> A - 2 FORCES AT WORK
> 
> While the lack of business ethics appears alarming, there are trends that are
> putting increasing pressure on business leaders to change these practices:
> 
> 1. The globalisation of markets, finance, and consumer behavior.
> 
> 2. The internationalization and increasing intensity of competition
> 
> 3. A shift from an industrial economy to a knowledge and information -
> based economy. This has created new demands and priorities:
> 
> • human capital is replacing financial capital as the most important
> strategic resource.
> 
> • work needs to be meaningful and fulfilling to attract, motivate
> and retain capable people.
> 
> • to capture peoples’ hearts and secure their commitment, the
> purpose and vision of the enterprise must be derived from moral
> and spiritual principles and communicated widely.
> 
> • the best and brightest people gravitate to jobs that foster personal
> growth.
> 
> 4. Quality, customer service, and innovation are becoming critical to success
> in competitive global markets.
> 
> According to the PIMS Group (Profit Impact of Market Strategy),
> "In the long run, the most important single factor affecting a business unit's
> performance is the quality of its products and services relative to those of
> competition. Quality drives market share". The return on sales and the return
> on investment for quality leaders are double the average returns.
> 
> 'Total Quality Management" means doing things right, the first time,
> with minimum resources, with a high level of involvement of personnel,
> and with a high level of support of management. Achieving this involves
> enormous changes in management practices - changes most companies have
> been unable to make.
> 
> 5. Value systems, life styles, and expectations are changing. For example,
> younger employees are increasingly seeking fulfillment in their jobs.
> 
> Bill O'Brien, president of Hanover Insurance Company, is quoted by
> Peter Senge in The Fifth Discipline as saying: "Our traditional organizations
> are designed to provide for the first three levels of Maslow's hierarchy of
> human needs: food, shelter, and belonging. Since these are now largely
> available to members of industrial society, our organisations do not provide
> sufficiently unique opportunities to command the loyalty and commitment
> of our people. The ferment in management will continue until organizations
> begin to address the higher order needs: self-respect and self-actualization."
> 
> 6. The economic environment is increasingly unstable and turbulent.
> Futurologists seem to agree on one thing: that the environment in which
> businesses operate will be increasingly turbulent. To use Peter Veill’s analogy,
> permanent white water will continue to characterize the markets in which
> we compete. Several recent studies indicate that, in unstable environments,
> value-driven and human resource oriented companies perform significantly
> better than companies that do not have these characteristics.
> 
> 7. Rapid technological change is simultaneously alleviating many burden-
> some tasks, permitting greater customerisation of production, and contributing
> to chronic unemployment. Modern information technology makes it possible
> to decentralize decision making without losing control and to introduce more
> flexible and less hierarchical structures.
> 
> 8. A demographic revolution is creating labor shortages of qualified people,
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> bringing to light the mismatch between our education systems and the needs
> of an information society. The OECD warns of a "demographic time bomb"
> and a "monumental mismatch" between jobs and workers able to do them.
> As a result, according to the recent World Leadership Survey conducted by
> the Harvard Business Review, education is considered by business leaders to
> be the most critical issue for the future of their organizations.” Peter Veill, in
> his recent book, Learning as a Way of Being, emphasizes that education and
> learning must change dramatically to meet the requirements for managing
> in “permanent white water.”
> 
> 9. The participation of employees in ownership and management is expanding.
> According to Joseph Blasi and Douglas Kruse in their book, The New
> Owners, employees now own more than $150 billion worth of stock in US
> corporations, and control an average 12% of the 1,000 largest US companies.
> To a large extent this ownership is through pension and savings plans and
> trusts that hold stock for workers. The issues of employee representation
> on boards of directors, and the role of employees in corporate governance
> will be subjects of debate.
> 
> A - 3 PROMISING SIGNS
> 
> Management literature on excellence, quality, ethics, leadership, and more
> recently even spirituality in business is expanding, reflecting increasing top
> management interest in these areas. More importantly, there is growing
> recognition that higher and deeper values than money must be tapped to
> attract and motivate competent people.
> 
> Networks of business executives concerned about ethics, social responsibility,
> sustainability, and corruption are springing up like mushrooms both in Europe
> and in North America. Most of these networks have developed since the first
> edition of this monograph in 1991. The World Business Academy is a support
> network of nearly 500 business practitioners from around the world exploring
> fundamental paradigm shifts in business. Its members promote the concept
> 
> that business, as the most powerful institution on the planet, must assume
> some responsibility for the transformation of society and the shaping of the
> future of our planet. The European Business Ethics Network has grown to
> nearly 500 members and is closely linked with the European Business
> Ethics Institute. The World Business Council for Sustainable Development
> spoke out at the World Summit on Sustainable Development in Rio for the
> positive action and responsibility of large business in promoting sustainable
> development. Similarly, the Business Association for the World Social
> Summit (BUSCO) expressed the commitment of a number of business leaders
> to contribute to world social progress. The Caux Round Table of business
> leaders from Europe, Japan and the United States published its “Principles
> for Business” emphasizing the importance of global corporate responsibility
> in reducing social and economic threats to world peace and stability. The
> Social Venture Network and the Social Venture Network Europe link social
> entrepreneurs and decision makers committed to the social responsibility
> of business, as does Business for Social Responsibility, a 1,200 member
> network of companies in the United States. The Berlin based Transparency
> International is leading a crusade to fight corruption in international business
> transactions. In Scandinavia, the Natural Step (Sweden) and the Common
> Cause (Denmark) are in the forefront of this paradigm shift.
> 
> This list would be incomplete without mentioning the European Baha’i
> Business Forum (EBBF), a network of several hundred business people
> familiar with the Bahá’í social and ethical teachings and seeking to apply
> them to business and economic issues. The core values of EBBF include
> ethical business practices, the social responsibility of business, stewardship
> of the earth’s resources, partnership of women and men, the need for a
> new paradigm of work, and non-adversarial decision making based on
> consultation. Underlying these core values is the fundamental need to
> apply spiritual principles - or human values - to the solution of economic
> problems.
> 
> Another promising sign was the success of the World Business Forum at
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> Habitat II, The City Summit, in Istanbul in June 1996. More than 300
> leaders of business, non-governmental organizations, non-profit associations
> and networks committed themselves to join in partnerships with national
> and local governments and United Nations agencies to improve the quality
> of life in cities throughout the world. This conference created considerable
> momentum which can be expected to foster closer collaboration among
> business, governments, NGO’s, United Nations agencies, and non-profit
> associations in combating social disintegration.
> 
> An increasing number of corporations are developing statements of mission,
> values and beliefs and codes of conduct. The process of developing and
> communicating these credos serves to mobilize management and employees
> to-gether in the pursuit of a common purpose and a common vision that
> go well beyond profits, pay, and promotions. In France, these "projets
> d'entreprise" constitute an important area of intervention by consultants.
> When one analyzes a number of these statements, one finds them to
> be strikingly similar (see Exhibit 1). They reflect a balancing of top
> management's accountability to shareholders with a sense of responsibility
> to other stakeholders which include employees, customers, suppliers and
> business partners, the earth, and the communities in which they operate.
> This clearly represents a higher stage of ethical consciousness on the part
> of business.
> 
> Management practices are changing. Some executives and authors even
> talk about a revolution and a transformation in management practices and not
> simply about changes. This is particularly so in sectors subject to fierce global
> competition, rapid technological change and increased complexity. Much has
> been written about the delayering and decentralization of structures, about
> the increased use of interdisciplinary teams, and about self-managed work
> groups. In addition, we are beginning to see:
> 
> • more use of consultation in decision making to foster creativity
> and innovation and to facilitate the functioning of autonomous work
> 
> groups. The Chairman of L'Oréal, world leader in cosmetics and
> hair products, recently said that every strategic idea is submitted to
> contradiction because "c'est du choc des idées que naît la stratégie".
> ("It is from the confrontation of ideas that strategy is born.")
> 
> • greater empowerment of individuals as companies are moving
> decision-making authority and initiative to the people who are
> clos-est to the customer and the product.
> 
> • increasing investment in continuing education and the development
> of human resources and potential.
> 
> • greater employee participation in profits and ownership.
> 
> • more diversity in the workplace.
> 
> And there is increasing emphasis on "leadership" and somewhat less on
> "management". By “leadership” is meant mobilizing an organization and
> moving it to accomplish some defined purpose, whereas “management”
> can best be described as a series of processes (ex: planning, budgeting,
> organizing and controlling). Leadership increasingly involves filling such
> roles as servant, educator and facilitator. As Lao-Tse said, “Leadership is best
> when people say ‘we did it ourselves.’”
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> B. A BAHA'I PERSPECTIVE
> ON THIS PARADOX
> It seems clear that there is a paradox. On the one hand, the decline in
> business ethics is only one facet of widespread social disintegration and of an
> erosion in the credibility of our traditional institutions such as government,
> religion, and even the family. On the other hand, there are promising signs
> that a new world order is emerging and that business leaders are destined to
> play a vital role in transforming society.
> 
> Shoghi Effendi, the great-grandson of Bahá’u’lláh, founder of the Bahá’í
> Faith, in writing about universal fermentation, not only highlights and
> contrasts the two opposing trends toward integration and disintegration; he
> explains that the very forces of disintegration "tear down the antiquated
> barriers . . . and accelerate the realization of humanity's distanced goal".
> Is this not a very positive answer to the paradox and to those who seem
> paralyzed by the disintegration of society? He goes on to say:
> 
> "As we view the world around us, we are compelled to observe
> the manifold evidences of that universal fermentation which, in
> every continent of the globe and in every department of human
> life, . . . is purging and reshaping humanity in anticipation
> 
> of the day when the wholeness of the human race will have
> been recognized and its unity established. A two-fold process,
> however, can be distinguished, each tending, in its own way
> and with an accelerated momentum, to bring to a climax
> the forces that are transforming the face of our planet. The
> first is essentially an integrating process, while the second is
> fundamentally disruptive. The former, as it steadily evolves,
> unfolds a system which may well serve as a pattern for that
> world polity towards which a strangely disordered world is
> continually advancing; while the latter, as its disintegrating
> influence deepens, tends to tear down, with increasing violence,
> the antiquated barriers that seek to block humanity's progress
> towards its destined goal.
> 
> A titanic, a spiritual struggle, unparalleled in its magnitude yet
> unspeakably glorious in its ultimate consequences, is being waged as a result
> of these opposing tendencies, in this age of transition through which mankind
> as a whole is passing."
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> C. SOME RELEVANT BAHA'I CONCEPTS
> 
> Few prescriptions for managers are to be found in the Writings of the Bahá’í
> Faith, yet these Writings are rich in underlying principles which bear directly
> on the major changes taking place in management. An excellent example of
> the relevance of Bahá’í concepts and principles is that brainstorming came
> directly from these teachings on consultation in decision making. Apparently,
> in the early 1950s several advertising executives from New York visited
> the Bahá’í House of Worship in Wilmette, Illinois and were told about the
> functioning of Bahá’í consultation. Upon their return to New York they put
> into practice these principles of consultation, detachment from one’s own
> ideas, building on the ideas of others, and not criticizing others' comments.
> They called it "brainstorming".
> 
> C - 1 MACROECONOMIC LEVEL
> 
> It is beyond the scope of this article to discuss the macroeconomic concepts
> and teachings in the Bahá’í Faith. These are developed very well in two
> publications, Economics for a World Commonwealth and Faith & World
> Economy. Among the macroeconomic principles are:
> 
> 1. Spiritual principles should be applied to solving economic problems.
> 2. Material conditions are a reflection of spiritual conditions.
> 3. World government.
> 4. Universal auxiliary language and system of weights and measures.
> 5. International monetary system.
> 6. International control of the exploitation of major raw material resources.
> 7. Free trade
> 8. Interdependence of capital and labour.
> 
> C - 2 THE CORPORATION
> 
> Similarly, there are certain principles that will influence management
> practices at the level of the corporation. These include:
> 1. The spiritual and the material must go hand in hand. In other words,
> both spirit and form are necessary; there is a dynamic coherence between
> the material and the spiritual aspects of life. An increasing number of
> corporations are recognizing this. In the words of Robert Haas, President
> of Levi Strauss, "A company's values - what it stands for, what its people
> believe in - are crucial to its competitive success. Indeed, values drive the
> business." And again, "Values provide a common language for aligning a
> company's leadership and its people." Dr. Dorothy Marcic, in her recent
> book, Managing with the Wisdom of Love, and in an article ”The Spiritual
> Foundations of the New Management Paradigm”, published by EBBF,
> emphasizes that spiritual principles such as justice, integrity, unity, respect,
> and service underlie the new management paradigm.
> 
> 2. Consultation: Achieving excellence, gaining a competitive edge through
> quality, improving motivation through worker participation, accelerating
> new product introduction through multi-disciplinary task forces, increasing
> creativity and innovation - all of these changes so critical to success and
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> even survival require more consultative and participative approaches to
> management.
> 
> 3. Collaboration of management and labor - without which few companies
> will survive in the post-industrial market place.
> 
> 4. Arbitration of disputes.
> 
> 5. Profit sharing in recognition of the important stake employees have in
> the enterprise.
> 
> 6. Equality of rights of men and women.
> 
> C - 3 THE INDIVIDUAL
> 
> Shoghi Effendi wrote in a letter dated 26 December 1935, "By the statement
> 'the economic solution is Divine in nature' is meant that religion alone can, in
> the last resort, bring in man's nature such a fundamental change as to enable
> him to adjust the economic relationships of society".
> 
> The Bahá’í principles concerning individual conduct in business emphasize
> the qualities of honesty, trust, integrity, rectitude of conduct, truthfulness and
> trustworthiness. Other concepts developed in the Bahá’í writings that serve as
> guidelines for individual behavior in today's business world include:
> 
> Excellence: long before the myriad of books on excellence were conceived,
> Bahá'ís were exhorted to strive for excellence both in their personal lives
> and their professional pursuits rather than remaining in a comfortable state of
> satisfaction with the status quo.
> 
> Voluntary sharing: considered to be "a greater thing than equalisation."
> "Man reacheth perfection through good deeds voluntarily performed."
> 
> Wealth is spiritual, as well as material. Material wealth is considered
> to be praiseworthy if it is acquired through an individual’s own efforts and
> if it be shared or expended to improve the welfare of society as well as
> that of one’s family.
> 
> Moderation in all things. In the words of Bahá’u’lláh, founder of the Bahá’í
> Faith, "In all matters moderation is desirable. If a thing is carried to excess, it
> will prove a source of evil. Consider the civilization of the West, how it hath
> agitated and alarmed the peoples of the world.”
> 
> Work as service: We all know the French musical refrain, "le travail, c'est
> la santé" (work brings health). Yet for many workers and managers as
> well, work and worship are considered two different "worlds" with two
> different sets of moral values. Bahá'u'lláh brings these two worlds together
> through the principle that work performed in the spirit of service is an
> act of worship.
> 
> Positive reinforcement: Positive reinforcement is replacing negative feedback.
> This practice derives directly from Bahá'í philosophy that we should look
> always at the qualities in others, not at their faults. By focusing on
> and encouraging the good qualities and strengths in others, we reinforce
> them. Bad qualities that are ignored tend to disappear through lack of
> reinforcement.
> 
> In addition, ‘Abdu’l-Bahá, the son of Bahá’u’lláh, says: "In the Bahá’í Cause
> arts, sciences, and all crafts are worship. The man who makes a piece of
> notepaper to the best of his ability, consciously concentrating all his forces
> on perfecting it, is giving praise to God. Briefly, all effort and exertion put
> forth by man from the fullness of his heart is worship if it is prompted
> by the highest motives and the will to do service to humanity. This is
> worship: to serve mankind and to minister to the needs of the people.
> Service is prayer."
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> So, we need to seek work in which we can find this motivation of service
> and the will to strive for excellence and distinction. But as managers we
> also need to organize the work of our colleagues in a manner that permits
> them to derive meaning and personal fulfillment from it. Willis Harman, in
> his excellent book Creative Work, says “meaningful work is not necessarily
> work that is exciting and challenging at every moment; it is enough that it
> be part of a larger endeavor which is infused with meaning. It is mainly
> that larger endeavor for our modern, mass-consumption society which is
> lacking.” And this is the reason many chief executives are trying to define
> and communicate socially meaningful purposes for their enterprises as a
> vehicle for building greater loyalty and motivation at all levels.
> 
> Not only is work thus elevated to worship, but the Bahá’í writings make it
> clear that we must all work and have a profession. As Giuseppe Robiati said
> in his book already referred to, "Man is incomplete without work . . .Work
> should develop human potential, and use such technology as will promote
> individual growth, so that the new meaning of work, as an act of service
> and worship, may be understood". Bahá'u'lláh made this obligation to work
> very clear when he said, "Trees that yield no fruit have been and will ever
> be for the fire."
> 
> So, it is clear that work has significance over and above its utilitarian value,
> and contributes to the development of spiritual qualities if the spirit and our
> motivation are correct. As companies become more customer-driven, with
> quality and customer service given an overriding importance in the hierarchy
> of values, employees will be able to see their work as a service to mankind,
> that is to customers, both external and internal, on whose confidence their
> own employment depends.
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> D. TOWARD A NEW PARADIGM
> OF MANAGEMENT
> 
> D - 1 WHAT IS A PARADIGM?
> 
> The word paradigm comes from the Greek paradeigma (pattern). It is said to
> have been coined by Thomas Kuhn , the philosopher and science historian,
> who used it to refer to the dominant theoretical framework, or set of
> assumptions, that underlies any particular science. He defined paradigm as
> "a constellation of concepts, values, perceptions and practices shared by a
> community which forms a particular vision of reality that is the basis of the
> way a community organizes itself."
> 
> Webster defines paradigm as "A cluster of basic assumptions that form a
> world view" and "a pattern, example, or model".
> 
> Marilyn Ferguson, in her book, The Aquarian Conspiracy, develops the
> concept further, referring to a paradigm as "A framework of thought ... a
> scheme for understanding and explaining certain aspects of reality." She goes
> on to talk about a paradigm shift as a distinctly new way of thinking about old
> problems, “new paradigm involves a principle that was present all along but
> unknown to us. It is a transformation of our consciousness.”
> 
> New paradigms are nearly always received with coolness, even mockery and
> hostility. The classic example of a paradigm shift is the theory advanced by
> Nicolaus Copernicus in the sixteenth century that the Earth did not lie at the
> center of the universe. His mathematical calculations showed that if the sun
> lay at the center, many of the anomalous motions of the planets could be
> explained. This was of course heresy to the Church, and Copernicus did not
> publish his work until late in his life. Some of his supporters were punished
> by the Church, some even burnt at the stake. His own work, when it was
> eventually published, was placed on the papal index of forbidden books.
> 
> Eighty years later, Johannes Kepler came to the realization that the sun-cen-
> tered system could explain the various planetary movements provided that
> the planets traveled in ellipses rather than circles. These two major shifts
> away from the idea of the Earth being at the center of the universe and from
> the idea of circular motion together gave birth to a new paradigm, a radically
> different world view and of our place in it.
> 
> Similar shifts in thought are now occurring in many areas of science and other
> intellectual domains. One hears more and more about a new paradigm in
> health: a holistic concept emphasizing the interdependence of the body, the
> mind, and the environment. In education, the shift is away from the notion
> that education involves only the acquisition of knowledge to the idea that
> the essence of education is learning how to learn and that it is a lifetime
> under-taking not limited to the young.
> 
> Looking at these and other paradigm shifts, changes seem to go through
> the following stages:
> 
> 1. Anomalous findings that cannot be explained in terms of the currently
> accepted paradigm. Initially these anomalies may be rejected as spurious or
> fallacious, or the model may be "stretched" to incorporate them.
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> 2. An increase in the number of such anomalies until they can no longer be
> so easily discounted or accommodated, and it is realized that the paradigm
> may be at fault.
> 
> 3. The formulation of a new paradigm that explains the new findings.
> 
> 4. A transition period in which the new paradigm is challenged by the
> establishment, sometimes leading to bitter opposition by those who are
> attached to the old paradigm.
> 
> 5. Acceptance of the new paradigm as it explains further observations and
> predicts new findings.
> 
> One thing which is striking: when an idea or a new model has reached its
> time, it takes very little to trigger a paradigm shift. Witness the tremendous
> influence of Gandhi and his concept of passive resistance. Ervin Laszlo has
> referred to this phenomenon as the "butterfly engine" effect: when an idea
> is ripe, it is not necessary to have a large engine to drive it through; it takes
> something as small as a butterfly to make it catch on.
> 
> Václav Havel senses that mankind may well be in the midst of a paradigm
> shift when he writes:
> 
> “There are good reasons for suggesting that the modern age has
> ended. Many things indicate we are going through a transitional
> period, when it seems that something is on the way out and
> something else is painfully being born. It is as if something were
> crumbling, decaying and exhausting itself, while something else,
> still indistinct, were arising from the rubble.”
> 
> Also, Bahá’u’lláh, founder of the Bahá’í Faith, wrote: “The world’s equilibrium
> hath been upset through the vibrating influence of this most great, this new
> World Order . . . the like of which mortal eyes have never witnessed.”
> 
> D - 2 TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> Some say that there is no such thing as a new paradigm of management to
> which all organisations must adhere. Each organisation, they say, and not
> without reason, has its own set of governing ideas, its own vision of the
> fu-ture, its own purpose or mission, and its own core values. Sometimes these
> are implicit, increasingly they are in writing. They are shaped by external
> forces such as culture, competition, and characteristics of the business, forces
> which are common to other companies. But they are also shaped by internal
> forces such as the traditions, the culture, and the chief executive office.
> 
> Yet, the winds of change are blowing, new global patterns are emerging, and
> a new spiritual and social paradigm is taking shape which seems destined to
> bring about a new world civilisation. Within this context, it seems evident
> that a new paradigm of management must emerge, a paradigm shaped by
> the external forces at work to which individual organisations are reacting.
> Bahá’ís feel that this new paradigm must inevitably reflect the new spiritual
> values and teachings inspired by Bahá'u'lláh.
> 
> How can we best describe this new paradigm? Its overriding characteristic
> must be the balancing of material values so predominant today with spiritual
> values. To capture the hearts of those who determine the very survival of an
> enterprise, and to win the commitment and motivation of those concerned,
> a more holistic vision of the purpose and the functioning of organizations
> is emerging.
> 
> On the one hand, this holistic vision broadens the purpose of the corporation
> beyond that of satisfying shareholders with dividends and capital gains
> to embrace a responsibility toward employees, customers, suppliers, the
> communities in which the enterprise works, and our planet, Earth. This is
> referred to as the "stakeholder concept", as contrasted to the "shareholder
> concept", and is reflected in many written statements of vision and mission.
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> This holistic vision also broadens our definition of organisation. Traditionally
> "organisation" was equivalent to structure: hierarchy, chain of command,
> span of control, and was closely associated with strategy and systems (the
> hard values). Increasingly organisations are viewed as living organisms, and
> the "soft" dimensions such as people, shared values and management style
> are being given equal consideration. One way of visualizing this holistic
> concept of organization is the 7S concept developed over twenty years ago
> by McKinsey & Company.
> 
> The Seven S Framework
> 
> STRUCTURE                            STRATEGY                             SYSTEMS
> 
> SKILLS
> SHARED                                                                     STYLE
> VALUES
> STAFF
> 
> Strategy Plan or course of action leading to the allocation of a firm’s scarce
> resources, over time, to reach identified goals.
> Structure Salient features of the organisation chart (i.e., functional, decentralized,
> etc.) and how the separate entities of an organisation are tied together.
> Systems Proceduralized reports and routinized processes (such as meeting
> formats), etc.
> Staff “Demographics” description of important personnel categories within
> the firm (i.e., engineers, entrepreneurs, MBA’s, etc.). “Staff” is not meant in
> line-staff terms.
> Style Characterization of how key managers behave in achieving the organisation’s
> goals; also the cultural style of the organisation.
> Shared Values The significant meanings or guiding concepts that an organisation
> imbues in its members.
> Skills Distinctive capabilities of key personnel and the firm as a whole.
> 
> This concept provides a framework for summarizing some of the shifts
> already underway in the models and practices of management in leading
> edge organisations.
> 
> A COMPARISON OF TWO PARADIGMS
> OF MANAGEMENT
> 
> OLD PARADIGM                        NEW PARADIGM
> 
> STRATEGY
> 
> Profit: the ultimate measure        Quality and customer service
> Time-based competition
> Big is beautiful                    Simplicity
> Rational                            Opportunistic, intuitive
> Centralized                         Decentralized
> Short-term focus                    Medium and longer term focus
> National focus                      Global focus
> 
> STRUCTURES
> 
> Hierarchical                        Horizontal
> Vertical                            Networks
> Pyramidal                           Interdisciplinary teams
> Autonomous work groups
> Communication through hierarchy     Open communications
> 
> TOWARD A NEW PARADIGM OF MANAGEMENT
> 
> SYSTEMS
> 
> Scientific management,              Empowerment
> “Taylorism”                      Job enrichment
> Content: tools and techniques       Process of greater value
> Information centralized             Information decentralized
> “A day’s pay for an honest          Profit sharing
> day’s work”                      Employee ownership
> 
> SHARED VALUES
> 
> Management                          Leadership
> Command and control                 Value-driven, vision
> Military model                      Commitment model
> Competition                         Cooperation
> Male domination                     Feminine balance
> 
> STAFF (PEOPLE)
> 
> People as a cost                    People as assets
> Continuing education and learning
> Task oriented                       People oriented
> Contract                            Covenant
> 
> STYLE (CULTURE)
> 
> Individual decision making          Consultation
> Avoid or resolve tension            Contention management
> Work and play are separate          Blurring of work and play
> Work as a means                     Work rewarding, source of
> self-realization
> 
> D - 3 CONCLUSION
> 
> Turbulence and change have become a permanent part of the environment
> of most businesses. In many sectors of the economy, a serious threat to the
> very survival of many companies is forcing managers to make fundamental
> changes in their management practices, changes which we refer to as a
> paradigm shift. As we review some of the changes summarized above, several
> generalizations seem appropriate.
> 
> First, there is a shift in focus from “management” toward “leadership”.
> Well designed strategies, structures and systems, the classical pillars of
> management, no longer suffice in periods of rapid change and great
> complexity. Equally important are the formulation and communication of
> purpose, vision, and process, the key ingredients of leadership.
> 
> Second, an essential part of the paradigm shift discussed in this paper is the
> balancing of economic and material goals with spiritual and human values.
> Traditional measures of progress such as return on investment, earnings
> per share, and gross national product are at best incomplete. Increasingly,
> progress also refers to the development of human potential and skills and the
> participation of the company in the wider community.
> 
> Finally, given the decline in the credibility of other institutions in our society
> such as our churches, our governments, and even our families, business
> leaders are being called upon to a much greater degree to help solve the social
> problems, the environmental crises, and the injustices which endanger our
> global system. Growing numbers of corporations are in fact recognizing that
> they have a social responsibility as well as an economic mission.
> 
> Exhibit 1
> 
> COMMON CORPORATE VALUES
> 
> A Synthesis of Statements of Values of Ten Corporations
> 
> Shareholders:      Profits and growth are essential
> Create value
> Provide reasonable returns
> 
> Employees:         Central to the success of the company.
> Encourage, recognize, value and reward creativity
> and productivity
> Encourage expression of views and opinions
> Equal opportunity for employment, development, and
> advancement
> Respect dignity and recognize merit
> 
> Customers:         Satisfaction of customers' needs is our primary mission
> Provide superior quality and value in products and services.
> Constantly listen to customers and be responsive to their
> needs.
> 
> Suppliers:         Partners who share our high quality and service standards
> Contribute significantly to our quality and value.
> 
> Communities: We strive to be good citizens, to contribute resources,
> time and talent to community improvement.
> Preserve quality of the environment and natural resources
> 
> Statements         Honesty and integrity (with employees, customers,
> on Manage-         suppliers and shareholders)
> ment style:        Participative
> Flexible, innovative, responsive, entrepreneurial organization
> Quality and excellence
> 
> REFERENCE LIST
> 
> • Autry, James. Love and Profit: The Art of Caring Leadership. New York:
> William Morrow & Sons, 1991.
> • Capra, Fritz. The Turning Point. London: Fontana Paperbacks, 1982.
> • Capra, Fritz. The Tao of Physics.London: Fontana Paperbacks, 1984.
> • Collins, James and Jerry Porras. Built to Last : Successful Habits of
> Visionary Companies. New York: HarperBusiness, 1994.
> • Covey, Stephen R. The 7 Habits of Highly Effective People. New York:
> Simon & Schuster, 1989.
> • Dahl, Arthur. The Eco Principle : Ecology & Economics in Symbiosis.
> Oxford: George Ronald and London: Zed Books Ltd, 1996.
> • Dupree, Max. Leadership is an Art. New York: Doubleday, 1989.
> • Ferguson, Marilyn. The Aquarian Conspiracy. London: Paladin Books, 1980.
> • Fussler, Claude. Driving Eco Innovation : A breakthrough discipline for
> innovation and sustainability. London: Pitman Publishing, 1996.
> • Harman, Willis and John Hormann. Creative Work - The Constructive Role
> of Business in a Transforming Society. Knowledge Systems, 1990.
> • Mack, Manfred. L’Imperatif Humain : Pratiques Managériales des
> Entreprises Avancées. Paris: Masson, 1992.
> • Makower, Joel. Beyond the Bottom Line: Putting social responsibility to
> work for your business and the world. New York: Simon & Schuster, 1994.
> • Maynard, R.B. and S. Mehrtens. The Fourth Wave, Berrett-Koehler, 1993.
> • Marcic, Dorothy. Management With the Wisdom of Love: Uncovering
> Virtues in Organizations. San Francisco: Jossey-Bass, 1997.
> • Nesbitt, John and Patricia Aburdene. Reinventing the Corporation.
> New York: Warner Books, 1985.
> • Ohmae, Kenichi. The Borderless World. New York: HarperBusiness, 1990.
> • Peters, Tom and Robert Waterman, Jr. In Search of Excellence.
> New York: Harper and Row, 1982.
> • Renesch, John and Bill DeFoore. The New Bottom Line : Bringing Heart &
> Soul to Business. San Francisco: Sterling & Stone, 1996.
> • Robiati, Guiseppe. Faith and World Economy: A Joint Venture. Gruppo
> 
> Editoriale Insieme, 1991.
> • Russell, Peter. The Global Brain. J.P. Tarcher, Inc., 1983.
> • Senge, Peter. The Fifth Discipline. Doubleday, 1990.
> 
> PUBLICATIONS OF THE EUROPEAN BAHA’I BUSINESS FORUM
> 
> • Dahl, Gregory, William Hatcher, and John Huddleston. Economics for
> a World Commonwealth: Essays on Economic Theory from a Bahá’í
> Perspective.
> • Emerging Values for a Global Economy - A Statement of EBBF, 1996.
> • Marcic, Dorothy. Spirituality and the New Management Paradigm, 1997.
> • Marcic, Dorothy and George Starcher. Ethics and Socialism - Now or
> Ever? 1995.
> • Palazzi, Marcello and George Starcher. Corporate Social Responsibility
> and Business Success, 1997.
> • Rodey, Barbara. The Spiritual Dimensions of Microfinance, 1996.
> • Starcher, Diane. Women Entrepreneurs: Catalysts for Transformation,
> 1996.
> • Starcher, George. Entrepreneurship, 1992.
> • Starcher, George. Ethics and Entrepreneurship - An Oxymoron?, 1995.
> • Zahrai, Ezzat. Group Decision Making and Bahá’í Consultation, 1991.
> • Zahrai, Michel. Ethics and Third World Development: The Role of
> Multinational Corporations, 1993.
> 
> OTHER PUBLICATIONS
> 
> Badí’í, Hooshmand. The True Foundation of all Economics : A Compilation.
> Bahá’í International Community, Office of Public Information, The Prosperity
> of Humankind, New York: Bahá’í International Community, 1995.
> Shams, Badi. A Bahá’í Perspective on Economics of the Future. New Delhi.
> Bahá’í Publishing Trust, 1989.
> 
> THE EUROPEAN BAHA’I BUSINESS FORUM
> 
> The European Bahá'í Business Forum (EBBF) is an association of women and men
> involved in business and management who are exploring ways and means of
> applying Bahá'í ethical and social teachings to issues arising out of their business
> activities. It is registered in France as a not-for-profit association. There are nearly
> 250 members of EBBF from 46 countries, primarily from Europe.
> 
> The activities of EBBF include an annual conference, a newsletter, a directory of
> members, and career counseling for student members. In addition, EBBF publishes
> selected articles and books written by its members on management. The external
> activities of EBBF are aimed at promoting the following core values and principles:
> 
> • Ethical business practices.
> • The social responsibility of business.
> • Stewardship of the earth's resources.
> • Partnership of women and men in all fields of endeavour.
> • The need for a new paradigm of work.
> • Non-adversarial decision making based on consultation.
> • Application of spiritual principles to economic problems.
> 
> EBBF collaborates in projects which contribute in meaningful ways to the social
> and economic development of selected countries in Eastern and Central Europe
> such as Poland, Bulgaria, Albania, Hungary, Romania, and Russia. These projects
> are organized in collaboration with other associations and non-governmental
> organizations in these countries.
> 
> Equally important, members of EBBF led a number of workshops at the non-
> governmental (NGO) forums in conjunction with United Nations conferences: the
> World Summit for Social Development in Copenhagen, the Fourth Conference
> on Women in Beijing, and Habitat II, the City Summit, in Istanbul. EBBF also
> participated actively in the World Business Forum in Istanbul.
> 
> For further information, contact the Secretariat:
> c/o George Starcher, 35 Avenue Jean Jaurès, 73000 Chambéry, France
> Fax: +33 479 96 35 70, Email: ebbf@fr.inter.net
>
> — *Toward a New Paradigm of Management (Used by permission of the curator)*