Osterman analyzes the traditional role of middle managers and how their role has changed with organizational restructuring. He argues middle managers must be redefined to effectively deploy talent. Osterman examines how middle managers were traditionally placed in hierarchies but now face lateral mobility and team-based structures. The challenges of defining middle manager authority amid flattening structures and how information flows bypass traditional filters are also discussed.

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BOOK REVIEW
What is Middle Management?
Paul Osterman (2008). The Truth About Middle Managers: Who They Are, How They
Work, Why They Matter (Boston: Harvard Business School Press).
INTRODUCTION
While there are an ever expanding number of theoretical models available in
business schools to understand the different forms of leadership theory and practice,
not much is known about middle managers.
The aim of this book is to get an effective handle on middle managers since they are
of considerable interest to both HR managers and work psychologists. It is an
attempt to answer the question: What is middle management?
They are also of interest to those who are working in the area of organizational
design since the whole problem of what to do with middle managers in
contemporary organizations is directly related to the flattening of organizations in
knowledge-based sectors of the economy.
This process of flattening in hierarchies has resulted in a lot of re-organization at
best, and even some confusion at worst on the right way to design organizations and
redefine what it means to manage across a range of organizational contexts.
ROLE OF MIDDLE MANAGERS
Paul Osterman, who teaches Human Resources and management at the MIT Sloan
School of Management, argues that it is necessary to re-think the predicament of
middle managers in flat organizations; clarify their role responsibilities; redefine the
scope of their authority; and thereby make it possible to deploy; or re-deploy them,
much more effectively in the context of talent management.
Osterman’s book spells out exactly how to do this on an ongoing process. The
urgency of this task emerges from the fact that collaborative forms of value addition,

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the deconstruction of functional silos, and the resulting forms of ‘boundarylessness’
(as Jack Welch of GE is fond of putting it), have resulted in a situation that often
leads to a loss of control in terms of how middle managers perceive the situations in
which they find themselves.
The challenge then is to find a way of re-situating the locus occupied by middle
managers without re-imposing the forms of rigidity that will lead to loss of
competitive advantage for the firms in which they are employed.
This is easier said than done since such a task presupposes that the existence of the
problem has been widely recognized, understood, and theorized and that sufficient
number of case studies have been generated to think through such situations (with
the high levels of granularity required for those who attempt to give advice on such
matters in academia or consultancy).
PITCHING FOR THE MANAGER
The impression that the reader gathers from Osterman’s book however is that this is
not necessarily the case.
A great deal of the urgency in his attempt to pitch for the middle manager stems
from the fact that he is ahead of the curve in understanding the situation as it
prevails in most firms nowadays. Osterman is therefore in a position to help us to
understand what the options are in managing such situations in organizations.
The three stages of Osterman’s argument focus on what the situation used to be,
what the situation is now, and what must be done to direct the situation in a way
that will lead to value addition both in the present and in the future.
Osterman’s arguments, diagnosis, and prognosis also intersect interestingly enough
with Peter Capelli’s work on talent management (especially in the sense that talent
poses a special version of the problem).
This theoretical intersection must also be situated within the efficiency/effectiveness
continuum since the main belief in organizational delayering was the possibility of
greater efficiency.
What was not always thought through was whether cutting slack completely will
necessarily lead to efficiency since such organizations increasingly found it difficult
to innovate or deploy talent to differentiate, especially in the context of hyper-
competition.

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IMPLICATIONS OF OSTERMAN’S WORK
The implications of Osterman’s work for both business academics and management
consultants must be obvious: it will make it possible for them to address an
organization’s anxieties about its placement in a given sector of the economy, and
address its legitimate need to make a smooth transition from the plane of efficiency
to that of effectiveness through the deployment of talent-based resources.
The modalities that must be identified to make this possible on an ongoing basis is a
part of the preoccupations that Osterman brings to this book.
Osterman begins by identifying the category of employees who are known as
‘middle managers,’ analyzes the traditional functions that they have played in the
organizational hierarchy; lists the assumptions that have been made by scholars of
organizational studies on what makes them tick; and considers the experiences of
encountering the process of organizational re-structuring from their point of view.
THE VISIBLE HAND
Osterman is keen to recognize the role that they have played in the ‘managerial
revolution’ that Alfred Chandler Jr. of Harvard Business School recognized under
the aegis of the ‘visible hand’ of management (as opposed to the ‘invisible hand’ of
impersonal economic forces that Adam Smith discussed in his treatise on the ‘wealth
of nations’).
The main justification in these discussions for the role played by middle managers is
the need to supplement whatever is missing in terms of the basic forces that
constitute the economy through managerial interventions.
The problem, as Osterman understands it, is that the actual number of managers
required to supplement the invisible hand was not clearly understood.
There was therefore an oscillation in defining the right scope of the middle
manager’s authority in organizations depending on the state of the economy.
Economic booms saw a much higher recruitment of middle managers, but during
economic contractions there was a reduction in the number of middle managers
thought necessary to make either the economy or the organization hum along
effectively.
The downsizing of IBM was, in a sense, synonymous with the end of the period that
constituted the expansionary stage of the managerial revolution. The period that
followed began to organize work with teams since there was a lot of coming and
going within and without organizations.

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Ad-hoc teams could and would be constituted and re-constituted when necessary to
get the work done in organizations. This has important implications for what
constitutes the effective span of managerial authority, and the attempts to redefine
this authority under the aegis of ‘team-work.’
This is probably why the team leader (or team lead) became a new form of
managerial authority; here the focus was on the managerial function rather than on
its traditional placement in an organizational hierarchy.
The role of the information revolution in moderating the authority invested in
middle managers must also be considered here since information flows were made
available across the organizational hierarchy without the need for filtering like in the
traditional organization.
Hence, the de-layering of the middle managers since employees could now access or
communicate directly with senior or top managers.
LATERAL MOBILITY
The linear assumptions in organizations that are built into its managerial hierarchies
were not responsive to the usual forms of organizational analysis that would serve
as the input necessary to make effective HR and leadership decisions since it was not
necessarily the case that middle managers would hang around long enough to climb
hierarchies (when value could be found through lateral movements between
hierarchies in similar organizations).
Lateral mobility became more exciting for middle managers rather than vertical
ascent within an organization.
Since this form of mobility coincided with the need for de-layering (or rightsizing) in
many organizations, managements did not object to such movements between
organizations on the part of their middle managers.
There was also a need to rethink the psychological configurations that held together
middle managers and their top leaders.
Managements changed their HR policy to offer employability rather than permanent
employment as the way ahead through training programs (so that emerging work
forces could be quickly re-deployed wherever there was work to be done without
loss of human capital to society as a whole).
NEW RULES OF ENGAGEMENT
A considerable amount of attention of HR personnel henceforth would be spent in
trying to figure what the ‘new rules’ of engagement and employment were in terms

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of how ethical employers and employees should relate to each other. Given the
number of books that are being written in this area, it is not clear that this is a settled
topic; but, nonetheless, it is something that must be introduced as a part of the study
material used to train HR managers in the years to come.
This, in a sense, is already being done albeit in the context of talent management
under the aegis of what we can term the attrition: retention ratio.
Osterman also discusses the psychological differences between managing men and
women managers and the motivational and behavioral structures that can be
invoked to differentiate between them.
Osterman also invokes the notion of ‘craft-work’ to understand the sense of
professional pride and sense of well-being that managers derive from their work.
He argues that identifying the main attributes of craft workers will give us a clue to
the psychological dimensions of managerial behavior, especially in helping us to
identify the forms of flow experiences that positive psychologists emphasize in
understanding how creative employees work to add value in organizations.
The main goal of talent management should therefore be to make such forms of
positive experiences more widely available within the levels of both middle
managers and the working population as a whole.
This will not only increase the levels of loyalty of the employees who choose to stay
but also increase their levels of job satisfaction through forms of creative
engagement; middle management, to conclude, ‘should be seen as a resource to be
developed.’
SHIVA KUMAR SRINIVASAN