The top management team cannot function without a secretariat -- a
secretariat that (a) keeps its members informed about the activities of each
other; (b) identifies and analyses relevant problems for decision making;
(c) processes information about projects -- at the appraisal, decision making
and supervision stages -- that is relevant for the various tasks of the team;
(d) suggests new ways of performing conventional tasks or giving up of obsolete
tasks, and (e) indicates new objectives that are in tune with the long-term
growth of the institution. Let us call this secretariat the Planning and
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Policy Cell (PPC). It should be manned by a few professional people (may be
four to five) who should be selected from the operating departments for their
competence. They should not be kept for more than five years in PPC; otherwise
they would lose touch with reality. After five years, by rotation, they should
be sent back to operational departments. PPC can also perform another function;
it can be a testing ground for identifying and selecting the potential members
of tomorrow's top management team. It would induce the personnel in the
operational departments to take an overall view of the functions of the institution as each one would tend to aspire to become a member of the PPC.
Management theory is silent on the function and structure of top
management; but in management practice,this was the very first area tackled
systematically -
- long before Frederick W. Taylor tackled organization design
in his functional structure. Top management as a function and as a structure
was first developed by George Siemens (1839-1901) in Germany between 1870 and
1880, when he designed and built the Deutsche Bank and made it, within a very
few years, into Continental Europe's leading and most dynamic financial
institution. 1 1 It was a universal bank, combining commercial banking and,
development banking functions. These universal banks performed 1a momentous
role" in German industrialization. "In Germany, the various incompetencies
of the individual entrepreneurs were offset by the device of splitting the
entrepreneurial function: the German investment banks -- a powerful invention
comparable in economic effect to that of the Steam Engine -- were in their
capital supplving functions a substitute for the insufficiency of the previously
created wealth willingly placed at the disposal of entrepreneurs. But they
were also a substitute for entrepreneurial deficiencies. From their central
vantage points of control, the banks participated actively in shaping the
major, and sometimes even not so major, decisions of the individual enterprises.
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It was they who very often mapped out a firm's paths of growth, conceived
far-sighted plans, decided on major technological and locational innovations,
and arranged for mergers and capital increases.13
It is such a universal bank -- the ancestor of the modern development banks -- that conceived the top management tasks and structure that in
many ways are a model for the latter.
