5 Lessons From Undercover Boss: The CBS network "reality show" Undercover Boss offers a dramatization of a long-established element of management theory, alternatively styled as Management by Walking Around, Management by Wandering Around or, in acronym form, as MBWA. In virtually every episode, as we follow a CEO or other senior executive going among his/her low-level employees in disguise, we find that:

1. Low-level employees in these companies invariably appear overworked, underpaid and poorly trained. The show rarely makes one eager to work in any of these companies.
2. The CEOs and other executives who go undercover are astonishingly out-of-touch with how their companies actually run. This is particularly amazing with respect to those entrepreneurs, increasingly featured on the show, who purportedly built their firms from scratch, and from the bottom up.
3. Undercover bosses invariably act utterly surprised at the low pay and poor working conditions for rank-and-file employees. This stretches credulity, since these are the result of their decisions.
4. In most cases, the executives going undercover do not need to disguise themselves. They are so remote from the average line employee that the latter often do not know their names, let alone their appearance.
5. In many of the featured companies, there is no investment in formal employee training programs. New employees with no prior experience are expected to work dangerous pieces of equipment with only cursory, hurried training by another low-level employee. Particularly worrisome are companies in which untrained and uncertified employees act as masseuses, hairdressers, nail technicians or exercise leaders for paying customers. In other companies, employees without proper qualifications are seen working with home electrical systems and mounting devices on homeowners' roofs.

The concept of MBWA is that effective managers have in-depth, first-hand understandings of precisely what the people in their organizations are doing, how they do it and why they do it. The only way to obtain such knowledge is through actual observation of and conversation with people at their jobs, and this requires managers (including high level executives) to get of their offices and spent time with the workers.

Regarding points 2 and 3, during this writer's working life at Merrill Lynch, especially in the latter years thereof, he encountered example after example of out-of-touch executives who failed to grasp the consequences of their decisions. Examples included an executive who could not understand why certain data was no longer available after he had eliminated funding for the systems that collected and maintained it, as well as a CEO who was astounded that his closing of a certain department resulted in its work no longer being done.

See our related discussions of management models and tips for choosing employers.

The Formula: The concept for Undercover Boss originated on British TV, and there also are Canadian and Australian versions, in addition to the U.S. version shown on CBS. Reruns of all versions can be seen on various U.S. cable channels.

A high-ranking executive, usually but not always the CEO, disguises his/her appearance and goes through a series of low-level jobs with his/her company, receiving on-the-job training from low-level employees. The standard cover story explaining the presence of cameras following the undercover executive is that he/she is competing on some sort of game show, and will be a winner if he/she is judged by those low-level employees to be a worthy job candidate.

Almost invariably, the undercover boss fails miserably at most, if not all tasks. He/she thereby gains an understanding of the difficulty of most low-level jobs in the company. The vast majority of employees featured on the show prove to be hardworking and conscientious, despite being woefully underpaid. A distinct minority prove to be bad actors of one sort or another. Another standard theme is that most, if not all, employees seen on the show face serious personal hardships.

In the final sequence, the formerly undercover boss, disguise removed, meets once again with the employees featured in the show, reveals his/her identity, and offers them generous gifts of one sort or another. See our discussions of the economics of Undercover Boss. whether success is due to talent or luck and how to advance your career through courtesy. Never does the boss increase the pay or benefits of all employees, since this would be much more expensive.

Key Causes for Skepticism: Calling Undercover Boss a "reality" show merits quotation marks denoting skepticism for several reasons, among them:

• The fact that all interactions are filmed has to influence what the employees choose to say. Nonetheless, it is remarkable that the vast majority of employees are highly critical of their companies on camera, rather than worried about saying something that could get them in trouble. This indicates very high degrees of general employee dissatisfaction.
• In many of the scenes involving conversations between an undercover boss and an employee, there are frequent cuts to different camera angles. If multiple cameras were filming simultaneously, you should see them in the background. Because you do not, this suggests that these conversations are stopped while the camera is moved. Thus, the spontaneity of these conversations is suspect.
• The process for selecting the employees whom the undercover boss will visit typically is unclear. This leads to added concerns about manipulation.
• Given how well-known Undercover Boss is, it beggars belief that the vast majority of employees take at face value the cover story that the filming is being done for another, completely fictitious show.