How Much Bureaucracy is a Good Thing in Government and Business?

 
 
SUMMING UP: Bureaucracies aren't by nature bad, but they aren't necessarily built for crisp decision making, either. James Heskett's readers debate the need for bureaucrats.
 
 
by James L. Heskett

Summing Up: Are Bureaucracies Worth Improving?

Several messages emerge from responses to this month’s column on the worthiness of bureaucracies. In general, there is a wide range of thinking about the value of bureaucracies and work done by bureaucrats; it leads some to devote thought to how bureaucracies can be made more effective in what they do.


One sentiment: Don’t confuse bureaucracies with deliberative (as opposed to intuitive) thinking, or with Daniel Kahneman’s ideas about “thinking slow.” Bureaucracies have functions that are largely not associated with decision making.

David Wittenberg addressed the semantics of the question regarding the role of bureaucracies this way: “Likening effortful, reflective thinking to bureaucracy misses the mark. Bureaucracies are focused on decision rights, not decision making,” Wittenberg wrote. “They are not created to deliberate or think.”

Ed Hare echoed Wittenberg's opinion: “(Bureaucracies) are far too often, about themselves and expanding the power and influence of the people who head them.”

Tom commented, “Most governmental bureaucracy is the result of crossed purposes: multiple groups who disagree on the desirability of certain results ….” Kamal Gupta, citing his experience with corporate bureaucrats, said, “We have a word for it; we call these people ‘zombie managers.’ They keep on pushing papers round and round, and then the actual decision goes to a guy who does not understand the subject at all.”

“We have a word for it; we call these people ‘zombie managers.’ They keep on pushing papers round and round, and then the actual decision goes to a guy who does not understand the subject at all”

Several respondents, some of whom have served in government agencies, defended the role of bureaucracy. These views assume that bureaucracies do have decision-making responsibilities.

Dean Dastvar put it this way: “Bureaucracy, in some form, is not necessarily an evil but rather a tool which can be refined generation after generation… There is a need for reform so that decision makers within government can have greater autonomy to make key decisions with the agility of System 1 (using Kahneman’s terminology) while within a larger System 2-developed strategic framework.”

Chiding other respondents for not shedding more light on the role that bureaucracies can perform, Eric W. Taylor, Jr. commented, “What I have detected in various comments on this web page is desperation when it comes to government. It seems like many Americans are just starting to give up, which is the absolute wrong approach.” Citing the Glass-Steagall Act in banking as well as actions establishing other social programs during the New Deal, Taylor concluded that, “Bureaucracy in those examples was very effective.”

Among the few suggestions for improving the functioning of bureaucracies was this from Guy: “If you want to have an efficient and effective bureaucracy, then you need to control the demands placed on the bureaucracy and the size of it … (overtasking its members in a way) that forces prioritization.”

In the context of other comments, it suggested the question: Are bureaucracies worth improving? What do you think?

Original column

The process leading up to a transfer of leadership in the United States, just as in other countries, always seems to be accompanied by several similar themes. One theme is change. For some reason, change has an appeal to voters, pretty much regardless of the performance of the incumbent, at least at the level of the presidency. Another common theme is the promise to trim organizations and fight bureaucracy. 

Both themes have a certain attraction in the business boardroom as well.

In business today, effective processes for decision making are associated with words like speed, agility, and ambidexterity--characterized by fewer filters through which decisions have to be processed and fewer people who have veto power over ideas, good or bad. Authority is delegated along with responsibility. Everyone acts in the best interests of the organization, assuming knowledge of the objectives and acceptable ways of achieving them. Permission doesn’t have to be granted. Rather, people act now and inform later, or else explain and examine what they did after the fact if things didn’t go well.

The way of the bureaucrat

That is in contrast to a bureaucracy, which is, according to my American Heritage Dictionary, “an administrative system in which the need or inclination to follow rigid or complex procedures impedes effective action.”

Wars on bureaucracy are waged and often thought to be won in non-governmental organizations. But there's a perception that the war is rarely waged or won in governments--particularly in democracies. 

This helps explain the periodic attraction of voters to business leaders, such as Donald Trump, who presumably have beaten bureaucracy in their own organizations.

What happens, though, at least according to US history, is that leaders who only have experience in business often are frustrated when they come up against the bureaucratic processes of government. Meetings are longer, more frequent, and involve more people. Everyone seems to want a voice in a decision. And when the leader finally decides, it is only at the end of a long time delay to accommodate rules, “due process,” imposed by citizens and their representatives in Congress.

When bureaucracy works

Bureaucracy doesn’t seem to have many advocates. But if we can extrapolate from the work of Nobel Prize winner Daniel Kahneman and others on individual human behavior, we may obtain insights into situations in which bureaucratic processes are beneficial.

Kahneman concludes that each of us reaches decisions using various combinations of “automatic” System 1 and “effortful” System 2 thinking. System 1 is characterized by informed intuition, speed, and decisiveness. It’s also subject to bias and what Kahneman calls “cognitive illusions.” System 2 is more deliberative and slower. It is especially appropriate when addressing complex problems we have not encountered before. But both Systems 1 and 2 can lead to poor decisions both in terms of content and timing.

Can we roughly equate bureaucracy to System 2 thinking? Is it too big a leap of logic to apply Kahneman’s thinking about individuals to organizations? If you think so, you may want to stop reading here. If not, are there ways of capturing the deliberative advantages of bureaucratic decision processes without paying the price of so many meetings, delays, decision screens, and minority vetoes?

What, if anything, could be done to counter those three words, “impedes effective action,” in the dictionary definition of bureaucracy? Are there ways of creating an effective bureaucracy either in business or government? Should we call a truce in the “war on bureaucracy?" What do you think?

Reference:

Daniel Kahneman, Thinking, Fast and Slow (New York: Farrar, Straus and Giroux, 2011)

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