Media Badger, Social Media Research & Consultants

Does Social Media Signal The Decline of Middle Management?

Seriously. Present day management structure is heirarchical, borrowing this process from military organization. All an employee needs to get their job done is connection to a boss. Senior management (CEO, COO etc.) direct corporate strategy. Executive management, VP’s then take the strategy and begin to break it down…it moves down the chain to middle management (directors, managers) and line managers (supervisors, branch managers etc.) to the line employees who do the tasks or tactical work.

Running a business takes resources. Management responsibilities are essentially to maintain structure so that decisions get made and tasks completed. The more people you add, the greater the complexity of coordination – and primary to coordination is communication. When a business gets to a certain size it’s primary role becomes self-preservation to keep the machine going – hence middle management and HR, PR and like departments. Middle management has often (and is today) a gatekeeper, a communications hub. I refer here to Ronald Coase and his paper “The Nature of the Firm.” in which he describes the challenges of organizational communication via transaction costs.

A firm is successful when the costs of managing its employees are lower than the potential gain from managing – profitability. When management costs are too high, the market will outperform the company. Part of the reason in a recession that we see middle management go so fast in cuts.

Social Media tools (i.e. Social Networking) enable groups and teams to quickly organize and can eliminate the need for middle managers who previously did that organizing. A well developed Social Network designed for a business can, through the use of roles definitions, personal resumes in a profile, tagging and such, enable faster, more cost efficient project and team organizing.

Collaboration tools such as “Wiki’s” and other knowledge and information management services reduce the cost of productivity for these groups.No longer do middle managers need to do the coordinating and assignment of tasks. A primary example of a tool that will change this is Google Wave. Microsoft’s answer is SharePoint and IBM is re-inventing Lotus Notes.

My bold prediction is that we’ll see less “middle management” over the next 10-15 years as these tools become common place. Skills will become ever more valuable and the ability to collaborate with fellow workers vital.