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The Rise of Managerialism

David Seth Preston

University of East London

The rationality that issued from the Enlightenment was the product of the continuum of European thought and practice interactions spanning centuries (Preston, 2001). The Scholastic Age had produced an appreciation of the value in organisation itself. The Renaissance brought forth individuality. Religion and later the (organised) state were effective restrictive agents on the boundaries of this individuality. The rise of science began in the 17th Century and reached vertiginous heights at the Enlightenment. Science took the form of objective facts. It was however facts that were rationalised through interaction with the (human) world. The Industrial Revolution demonstrates the interactive and dynamic nature of scientific rationalisation. People, through rational discourse on the latest discoveries, played the significant role in determining scientific and technological current practice.

Following the two world wars however capitalists began to recognise that science was the key to unlocking the individual self into a hedonistic world of greater riches. In order to achieve these unimagined levels of accumulation capitalism needed to do three things. Firstly acquire greater leverage over the science that was produced. Secondly make the connection between scientific ‘fact’ and the reality it produced as beneficial to capitalism as possible. Lastly, in order to avoid challenging reactive forces, both the two previous demands must be met without making the intention obvious (Habermas, 1971). By achieving all three any socially responsible science around would be very quietly turned into a socially dominant one.

The first of these goals, the control of scientific invention, was relatively straightforward in that it represents a familiar corporate problem. If one has too much competition you must aid the process of ‘natural selection’ by culling some of them. In this case buy the non-corporate competition. The second of the capitalist aims required something far subtler. The tying of ‘planned’ scientific discovery to desired implementation needed something much more subtle than the rustle of a few billion dollars. In order that it become firmly established the structure that was needed had to be built on the foundations of European historical developments. Clearly it needed to be scientific of sorts. In addition organisational prowess utilised in the running of an Empire, reinforced through Fordism, would play a significant role. Bureaucratic systems were something that appealed strongly to the British of the 1970s. Such a structure needed also to possess an extremely wide utility for it needed to get to the very grain of British society. This ‘scientific’ structure would necessarily be applied to areas of life where ‘facts’ (e.g. quality of goods) was not a familiar term. Such breadth of application necessarily required simplicity. To avoid alienating the masses the system needed also not be too complex. Furthermore it must conceal the raw accumulative ends of capitalism. I would add, perhaps more contentiously, that as a result of the recent wars it needed to demonstrate, quietly but firmly, that the system was succeeding. The structure that grew, and continues to do so, from these premises and the social milieu surrounding it is termed managerialism.

Capitalism is contradictory. This is a direct result of the modern distorted form of the individual rationality that began at the Enlightenment. The basic contradiction is that free to choose capitalism must deny that choice. It offers choice but must take it away in order to avoid anarchy. It seeks a system therefore that cannot be found. Habermas terms this the 'Legitimation Crisis' (Habermas, 1975). In its crudest form the crisis is the problem of how to distribute socially produced wealth inequitably and yet legitimately. Capitalist ends are accumulative, necessitating growth, progress and change. If all are allowed, as would be the case in a truly democratic process, to select any of a range of options then non-capitalist ends could result. Such an outcome would be, in current capitalist terminology, inefficient in that ends would not be delivered. Hence a highly restricted choice is offered; anything that furthers the accumulative ends. Other choices must, to use a term of Habermas, be ‘closed down’. Indeed the system has such a vice like grip that it often prevents the very formulation or analysis of such choices at all. Not happy with removing the sub-structure of non-capitalist thinking, turbo capitalism makes audacious attempts to remove the ground itself. Turbo capitalism seeks to make all thought the result of accumulative ends. To avoid such threats to capitalism, science has been utilised to verify capitalist accumulative ends. Kafka depicts a terrifying world achieved through control of the Law. The control of science and the way invention is rationalised to the world affords capitalism the ultimate delivery system of its ends.

In my view the roots of managerialism are to be found in this Legitimation Crisis. This crisis is basically the need to justify divisive accumulative ends. In addition managerialism makes this justification seem rational. In order to do so a dishonest objective utilisation of the subjective products of science is needed. By making the use of science and technology almost totally equivalent to its mere invention a discourse of inevitability runs unchecked and has largely vanquished all erstwhile social rational arguments. Managerialism is thus the amoral answer to this crisis of contradiction that is to be found at the centre of turbo capitalism.

Managerialism is essentially the belief in a strategic approach. The belief is that by setting goals all of us will get to where we wish to be. The nation and supranational state sets inflation and employment targets, the organisation pens its desired market share and the individual documents their life plan. If you fail to reach your goal it was your target getting that was in error not your target setting. Within an organisation how this works by a group of influential people within the organisation discuss and derive an overall 'Mission' consisting of several organisational goals. These goals are essentially the targets for the next operating period, often around five years. These strategic goals are then analysed by individuals lower down the organisational hierarchy who utilise a similar process to that outlined above to derive more localised goals. These may in turn be looked at by another group further down the hierarchical structure to produce yet more localised goals. Indeed in a large international body the whole process may involve many iterations of the same idea. Certainly part of the appeal of the strategic approach is that it is standardised through the organisation. Put simply that managerial standard is to receive goals from above and to create new goals for below.

Part of the difficulty in analysing strategy is the existence of at least two different forms. The first, which I term ‘soft’, is roughly that outlined above of guidance through goals. This type was dominant in Britain in the 1970s but can still be found in many organisations today. Halal suggests the decline in popularity of ‘soft’ strategy is symptomatic of a new form of capitalism (Halal, 1986). The second type, which I term ‘hard’, of strategic approach is the dominant approach used in Britain today. It is characterised by the mission becoming doctrinal ends. All effort is directed at hitting the mission targets laid down. A missed target is a failure and one for which someone must be made accountable. These soft and hard forms really represent a spectrum. Indeed it is often debatable whether a system is hard or soft. However crucial to the location on the spectrum is the method approach to measurement. All post-1970s strategic models use measures of some sort. Measures are essentially the way one assesses whether a target was missed or reached. A University may use an average Research Assessment Exercise (RAE) score of 4 as the research target. Numerically defined targets, such as the one just given, would be fundamentally indicative of a hard strategy. Another University might have a soft form of target such as ‘foster a research culture through staff development’. A prevalence of soft targets would indicate a soft strategy.

One important point to note about strategy is its very simplicity. Strategic models are not meant to tax the mind. In addition they are not the sole preserve of the experienced expert. Certainly when one examines the constituent parts of strategy one is struck by the ordinariness of the tools (e.g. structured interviews, SWOT analyses) used. It is equally clear that the sum total of these rather innocuous methods does not justify the claims made in the name of strategy. For strategy and the people who conduct it are often treated with almost mysticism. Claims made in the name of strategy include the empowerment of customers, fairness through involvement of more staff, the liberation of operations via the localisation of decision-making and the production of a higher quality life.

It is clear that under hard strategic approaches organisational missions are largely formulated from above. These amount to ends with strict adherence criteria attached. Such missions often consist of ends that reflect only a capitalist concern for accumulation. The vaunted determinism of hard strategy is such that lower level employees are often reticent to express their concern. Cases such as the production and distribution of super-absorbent and highly toxic tampons or the environmental damage caused for want of a triple-hulled oil tanker demonstrate how other voices are often suppressed by those of technical experts (Winner, 1992). Occasionally a whistleblower reports some misdemeanour but this is merely a valve on a highly pressurised system. To paraphrase Brecht, a system that requires heroes is immoral.

The suppressive nature of the system is also evident in the failures of strategic implementation being almost totally ignored. Indeed strategic analysis is often reminiscent of the propaganda machines of the former Eastern European Block. Strategy is manufactured as both natural and blame free. Midland Bank, one of the first companies in Britain to use the new generation of strategic models, went bankrupt. Shell Oil, often seen as exemplary of the advantage of change from old methods to new ‘hard’ strategic practice, seems destined for uncontrollable decline. In face of such evidence, and the high bankruptcy rates in Britain since the advent of the new strategic approaches, it is somewhat surprising how little blame is attributed to the method itself. Indeed failure seems to only strengthen the strategic will to redeem organisations through more of the same. Strategy that claims analysis and inquiry as its weapons, as it exists in Britain cannot be so questioned. Contrary to its public voice therefore, strategy has fixed ends.

These and other disturbing results of strategic implementations have inevitably led to some dissenting voices. For example Reuters, an erstwhile ‘hard’ strategic disciple, have been public in their concern for the lack of innovation resulting from such strategic instantiations. They suggest ‘hard’ strategy tends to plough on regardless of whether anyone is learning from mistakes. They add that Reuters have evidence of strategy continuing in situations where nobody has the even the faintest notion of what is happening. Under the new Reuters approach individual units have considerable freedom in the things they do. This and other such models speak of corporations in a language of autonomy, openness, flexibility and co-operation. Such revised ‘soft’ approaches, requiring greater concern for a much larger base of human parties, are a reaction to both the controlling culture of hard strategic models and the immaturity of the former softer ones. However at present the use of such modern ‘soft’ approaches, though common in large parts of Scandinavia and Germany, form a small minority amongst British firms.

The ‘hard’ strategic models have tended toward extremely standardised forms. Indeed most such models promote their multi-discipline application. A bank is strategically driven in the same way as an oil company or a soccer club. Whilst one could argue that a small tobacconist has much in common with its neighbouring greengrocer they both seem far removed from the WH Smith or Microsoft. The point is that strategic models are not domain dependent because this enables individuals who will formulate the strategy to cross these domains. Strategy represents the view that lack of applied knowledge of the actual area is in no way detrimental to management. As such in can be viewed as a modern manifestation of the 19th Century amalgamation of two cultures (Preston, 2001).

The Enlightenment freed the individual to uncharted territory. Corporations are essentially group activities involving a mixed bag of people. Individualised freedom represents chaos to organisations. For organisations to accept such subjective freedom would threaten their very existence. Organisations consisting of blatant power structures would offend the individualised self too much to be practicable. Something much subtler needed to be constructed in order for it to work. A schema of power that was not transparent to those involved but rather appeared to offer freedom. The power system of immoral manipulation that evolved, commonly termed managerialism, did not occur as some upper class driven conspiracy but rather emerged from an uncertain history of opportunity.

Crucial to the instantiation of managerialism was the merger of the two cultures, aristocratic and bourgeois, that emerged from the fallout of the Industrial Revolution. In particular I stressed there that control and regulation became dominant managerial characteristics. Victorian and Edwardian industry became run by bureaucratic endeavour. Administrative innovation became more significant than technological. New harder strategic approaches, a reaction to a further crisis of capitalism occurring in the 1970s, brought with them the modern form of managerialism of tight control through quality, audit and monitoring techniques.

Strategy is often presented as simply clarifying loosely defined corporate aspirations. My point is that strategy, as generally practised, goes far beyond this limited form. Human dreams can after all be either unattainable or reassessed. The strategy practised in Britain tends to set those very same dreams in stone, leaving little or no room for critique or analysis. Everyday employees in the workplace act in ways that they themselves find unethical. As such hard strategy is immoral.

I would suggest that strategy has an optimal level of activity beyond which it becomes both inversely proportionate to the results achieved and the morality of the system. Beyond a certain point, the more you define the more it becomes control for control sake. The softer strategic approaches tend to reside below this point, the harder forms toward and beyond it. The recurring crises of capitalism have resulted in the upper levels of this control spectrum being frequently reached. Some voices of dissent have become apparent but a total denial of the hard strategic doctrine cannot be allowed to happen for fear that the key capitalist function of mere accumulation is threatened. The consequence is a system of lauded, through the marketing and image machines, freedom that in reality is anything but free.

So I am suggesting that managerialism is the belief in a strategic approach. It is thus making objective and deterministic claims to the nature of the life-world. These claims seem to contradict much of everyday experience. Managerialism is essentially an attempt to free society from the post-Enlightenment Legitimation Crisis. In other words it is an attempt to resolve the transparent conflicts of equitability that occur throughout society. Ultimately however it involves, despite claims to the contrary, the application of manipulative control and power. This is largely hidden but it is power nevertheless.


Habermas, J. (1971) Towards a Rational Society by Heinemann: London

Habermas, J. (1975) Legitimation Crisis Heinemann Educational: London

Halal, W. (1986) The new capitalism Columbia University Press: New York 1986

Preston, D. (2001) Technology, managerialism and the university Glenrothes Press: Fife, Scotland

Winner, L. (1992) Autonomous Technology MIT: Cambridge, Mass

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