managerial revolution

managerial revolution A concept which points to the shift, within the modern corporation, from the owner to the professional manager as the key figure in the enterprise. This is associated with the change from ownership to control as the key source of power and vested interests, and with the declining importance of family capitalism and private property in contemporary capitalism.

The concept originates in a book of that title by James Burnham (1941) who asserted that not only industrial establishments but state agencies and all other significant organizations would become dominated by a new ruling class of managerial professionals pursuing their own interests. It is also associated with Adolf A. Berle and Gardiner C. Means (The Modern Corporation and Private Property, 1932), who believed that managers would pursue broader corporatist goals, even at the expense of short-term profitability. Like most theories about management, the ideas are in practice untestable. See also BOURGEOISIE; DECOMPOSITION OF CAPITAL.