Managing in Dynamic Business Environments

Managing in Dynamic Business Environments

Between Control and Autonomy

Edited by Katarina Kaarbøe, Paul N. Gooderham and Hanne Nørreklit

This timely and innovative book focuses on budgeting control and ongoing Beyond Budgeting trends and its consequences for the organization. Ensuring an optimal balance between individual autonomy and management control is a critical challenge for organizations operating in dynamic business environments. Too much of the former leads to chaos, and too much of the latter guarantees rigidity. This book explores the tensions that arise in seeking the best possible balance between these two dimensions. Resolving these tensions is a critical challenge for achieving competitiveness.

Chapter 11: The autonomy-creativity orientation of elite business school students in the US and Norway

Paul N. Gooderham, Alexander Madsen Sandvik, Siri Terjesen and Odd Nordhaug

Subjects: business and management, corporate governance, strategic management


In staking out a new management paradigm appropriate for radically more dynamic business environments, Bogsnes (2009: 3) asks two questions: “What is it that really drives good performance?” and “How do we release creativity and innovation?” The notion is that employee creativity is increasingly important for organizations attempting to develop novel products and services, and innovative processes that build long-term competitive advantages (Zhang and Bartol, 2010). Bogsnes (2009) argues that one key to releasing employee creativity and innovation lies in management ridding itself of a controlling “Theory X” mindset (McGregor, 1957, 1960). Theory X assumes that employees are basically lazy, lack ambition and offer little in the way of useful ideas. Instead, Bogsnes argues for the adoption of a “Theory Y” mindset, which rests on the core assumptions that employees are capable of self-direction and autonomy, and that they can be the source of many useful ideas. In this regard, Bogsnes states: “When sailing in these new waters, we need less traditional management and more leadership, less theory X and more theory Y. This is the only way to mobilize the maximum performance from everyone onboard” (2009: xvii–xviii). He also argues that the intrinsic motivation that drives creativity can be easily undermined through the use of extrinsic rewards, such as individual bonus systems. “The bonus,” Bogsnes (2009: 34) contends, “undermines some of the interest in the job itself.”

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