The New Ruthless Economy: Work and Power in the Digital Age

Rating:
Summary: Wake-up call
Review: Head picks three areas to primarily study in his New Ruthless Economy: autos, health care and call centers, but the first part of the book is devoted to an excellent review of the basic tenets of scientific management as originally envisaged by the engineer Frederick Taylor, and his lesser-known counterpart in office management, William Leffingwell. Armed with this knowledge, the reader can easily trace developments in the last fifty years or so.

As Head points out, the overall effect of the extension of these principles, especially combined with the vast electronic monitoring provided by recent advances in IT, is the overall dumbing-down of the worker, regardless of inherent or potential skills. The study of Toyota auto plants in Japan and other countries is particularly distressing, and one can easily see that it is only the influence of unions that has slowed down the treadmill. The situation with regard to call centers is appalling: truly the workers there are exploited ruthlessly. One wonders if in the offshoring of American jobs in the service sector, eventually the same massive turnover numbers will appear in developing countries.

Head, in my opinion, saves the best till last-managed care organizations. Here, as one reads both figures rarely published, research findings, and case studies, it becomes all too obvious that MCOs are an absolute disaster. Why are health care costs going up? It's all here in simple terms. Just this section of the book is worth reading alone if one is worried about health care in America.

ERP (Enterprise Resource Planning), CRM (Customer Resource Management) and a host of other business areas literally reorganized by giant software programs (SAP R/3, for example), are also discussed, and viewed as boondoggles that rarely achieve any desired goals.

The overall trends discussed in this well-written book should frighten both management and employees, and it is unfortunate that the latter so often buy into the consultants' ill-advised mantras.

Rating:
Summary: Big Brother Is Watching
Review: The New Ruthless Economy by Simon Head is a somber, thought provoking examination of how the American workforce has been dehumanized over the past decade. The widespread use of Information Technology in business was predicted to decentralize decision-making and empower employees through greater team efficiency. The reality of IT is an aggressive return to Taylorism and assembly-line routine and controls that migrated from manufacturing to service industries.

During the 1990's, wages of top management went through the roof but the average American worker realized little, if any, increase at all. The New Ruthless Economy explores contributing factors to the inequality of wages, loss of job security and weakened bargaining power in the American workforce.

Simon Head drew his conclusions based upon ten years of research across industry lines and geographic boundaries. He discovered that in the name of efficiency, businesses have established highly structured rules, computerized their processes and then implemented technology to ensure these rules were strictly adhered to alá George Orwell.

The author provides concrete examples ranging from software implemented by HMOs that determine a patient's length of care and treatment to the computer scripting used in call centers for wide-range solicitation. Use of these systems once again separates decision-making from the worker. It devalues an employee's education, training and experience while subjecting them to excessively close supervision and monitoring.

Head also points to the "lean production" and "ERP" (enterprise resource planning) practices that prompted wholesale layoffs in the early to mid 1990's. Not only did these systems reduce the skill levels of employees but they also significantly increased the level of worker scrutinization. Head explores the relationship between Information Technology and Scientific Management and concludes his book with a discussion of "the economics of unfairness" where both the National Labor Review Board and employee privacy rights take major hits at the waterline. The New Ruthless Economy takes a look backward and forward where the view for American labor is equally disappointing.

Rating:
Summary: Fresh perspective on the perils of the new economy
Review: This provocative book exposes the dark side of IT productivity gains, in which workers in service sectors such as medicine are being transformed into cogs on an assembly line. Ironically, just when industrial assembly line workers have been empowered to take responsibility for the overall quality of the products, the workers in areas where judgment once reigned supreme find themselves extruded through routines-- what to do, what to say-- that make central planning seem creative. The initial productivity gains are apt to disappear, Head suggests, just as they did in old assembly lines, as numb minds produce bad products.