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Establishing rules for the new workplace - Economics
USA Today (Society for the Advancement of Education), Nov, 2002 by John A. Challenger
The former economic system in the U.S. was characterized by a variety of structures that restricted the flow of people. Lifetime employment was a goal that companies and individuals alike hoped to achieve. When individuals accepted employment offers, they expected, as long as they did not do anything too wrong--like coming in late constantly, embarrassing the boss, or embezzling funds--that their jobs would be safe. The cornerstone of the social contract between the organization and the individual was long-term--even lifetime--employment.
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Individual identity was tied in with the company. IBM employees thought themselves privileged because of their identification with the organization. Big Blue hired the best and the brightest. People built their lives around the company. Often, a worker's closest friends came from within it. People closely integrated their working and personal lives. They bore witness to each other's lives, developing deep, solid, secure relationships over a lifetime. It was not unusual for coworkers to be godparents of each other's children.
After God and family, loyalty to the company was at the top of the value scale. The employee trusted the firm would provide job security; the employee returned that loyalty in kind, by pledging not to leave and certainly never thinking seriously about working for the competition. In fact, most workers cultivated an authentic dislike for rival companies. In the 1960s and 1970s, most of our outplacement clients, who had been terminated by their former employers, refused to even consider working for other companies in the same industry, willingly sacrificing organizations that had a special need for their industry knowledge.
There was a balance between shareholders and stakeholders. The latter--in this case meaning employees and communities--were once critical factors in long-term strategic decisions by companies. Moving plants and warehouses and jobs to another area of the country or world was unthinkable because of the damage it would do to the local community.
Hiring by big companies occurred mostly at the entry level. The Fortune 500 did not bring in many people over 40. The primary entry point into the organization occurred soon after graduation. New hires entered onto an upward, progressive career track until they plateaued or "Peter-principled."
CEO power and control were at their zenith, while a rubber-stamp advisory board of directors was not unusual. Often, CEOs handpicked the board members, who might be third- or fourth-generation family members, or the positions were sinecures for VIPs. Many did not serve even in an advisory role; the board membership was largely ceremonial.
The dominant cultural archetype was the Organization Man, who sacrificed his own goals for the good of the company. Refusing to take on an assignment meant the end of one's career growth. A firm could not trust an individual who did not put the organization first, ahead of more-personal and selfish needs like family and friends and roots.
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