Recently, the notion of management 3.0 has become increasingly popular in the world. This style of management originates from the IT sphere and project management. Having proven to be effective in the mentioned spheres, it now extends to other types of business, including auditing and consulting.
However, this style of management did not appear out of thin air. He was preceded by management practices such as management 1.0 and 2.0.
The main feature of this type of management is the company's complete dependence on its manager. As the vast majority of audit firms in Ukraine are small, this management practice is now widespread. The company manager assigns tasks and controls their execution. Essentially, such companies have no rules because they are set and abolished by one person.
Communications under these conditions are one-sided and vertical. The tasks come from above, and employees should perform them in the way that the manager deems optimal. People are run like machines, and they are manually operated. The organizational structure has a clear hierarchy that is difficult to adjust.
Although this management practice seems old-school and old-fashioned, it has both advantages and disadvantages. Among the advantages is tradition. Many people, especially the older generation, are accustomed to a systematic approach to work, a clear and understandable hierarchy, and the ability to shift responsibility to management. At the same time, under this management system, it is difficult (though quite possible) to cultivate talents, to build flexible and self-organized teams that are not afraid to take responsibility and are ready for the daily challenges. This is the main drawback.
In an organization where management 2.0 is used, everyone recognizes that "people are the most valuable asset" and every manager should become a "servant leader". This version of control is more flexible and perfect. The company has rules that everyone - both staff and executives - must adhere to. Communications are multi-vector. There is ongoing dialogue between the manager and the staff. Moreover, teams and subordinates are empowered to make decisions on their own or to influence the decision-making. The organizational structure resembles a matrix.
More and more companies are trying to stay up-to-date, moving away from traditional management practices. Audit firms are no exception. Democratic management style, work schedule flexibility and result orientation are the key attributes of 2.0-style management. The main advantage of this style is its convenience. It suits executives who are accustomed to working with people who are focused on achieving results and able to make decisions. At the same time, such personnel are quite demanding for management. That is why management must follow the rules at the staff level, otherwise the system will not work.
This management style is a complex adaptive system that does not have a permanent and clear structure. The team is self-organized, flexible and capable of achieving goals quickly. The manager in this system does not give orders and does not control their execution. He’ she is rather a mentor, an ideological inspirer and a consultant. He has no special status, playing his leading role in achieving a common result. Management ceases to be solely responsible. This is a necessary function. The goal of leadership is to expand the business, create the conditions for developing talent and meeting customer needs.