The football dressing room remains the last refuge of old-style management techniques.

 

The nation was in shock. David Beckham, Britain's most beautiful (and skilful) footballer emerged from his house on Monday morning to allow the world to photograph a wound above his left eye. Sir. Alex Ferguson, manager of his then team Manchester United, had lost his temper after a defeat and kicked a football boot, which hit the Beckham eyebrow.

 

In sports, more than in most businesses, the management tactics are out in the open for all to see. Not many managers try to strangle their subordinates - as Bobby Knight, a former basketball coach at Indiana University, one did. But the ability to inspire fear has always been an essential tool of management.

 

Lots of successful chief executives rule by terror. None, it must be said, reaches teh standard set by John Patterson, who built NCR early in the 20th century. "When a man gets indispensable, let's fire him", he would apparently say. One NCR executive discovered he had been fired when he found his desk and chair in flames on the company lawn. Modern laws on constructive dismissal and employee harassment have put an end to such fun.

 

However, terror in the workplace is making a comback these days. In an economic upwing, fear goes underground. Workers are scarce, and therefore powerful; bosses must handle the talent with care. When times turn tough, the balance of power swings. As Hank Paulson, chairman of Goldman Sachs, put it, in a speech that upset his staff, "in almost every one of our businesses, there are 15-20% of the people that really add 80% of the value." In other words, 80-85% are largely reduntant - and had better shape up fast.

 

Motivating talent

 

Does fear really motivate? In sport says Scott Snook, who teaches organizational behaviour at Harvward Business School, "fear can become a barrier to taking risks, yet can provide the essential emotional kick needed to meet a challenge. " Coaches need to strike the right balance (and the right player?) in order to develop talent.

 

Yet used in the boardroom, fear can be disastrous. Tony Couachman, a headhunter at Egon Zehnder in London, recalls the board of a large firm with a chief executive who so dominated his directors that they rarely questioned or challenged him. "Sucess in such a company depends on having a great leader leader and a steady market," he argues.

 

Jim Collins, author of a book that explains why some firms succeed in making the jump "from good to great" and others fail, found that the approach to fear was a key distinction among firms that he surveyed. He found that in the truly successful firms people were "productively neurotic". At Microsoft, for example, employees worry all year at the prospect of their annual meetings with Bill Gates, where even being shouted at would not hurt as much as seeming to be an idot.

 

The driving fear of failure, points out Mr. Collins. is not unique to corporate life. "I'm self-employed, and I live with constant fear," he says, "but I'm self-afraid." That kind of fear is commong among creative artists and also in professional services where the person is the product and lots of fragile egos have to be managed.