A Tentative Beginning
This is intended as the first in a series of blogs which will consider aspects of the idea of what it means to be ‘productive’.
Productivity is conventionally thought of as the output achieved for a given amount of input. For me that needs to be modified by recognising that the output must be useful; I contend it must contribute to a desired outcome defined as the ‘value’ (e.g. but not exhaustively, economic, social, environmental, political) desired. Activity which does not contribute to the desired outcome either directly or indirectly, is arguably not work but waste (as defined by Taichi Ohno).
Of course the legitimacy of the desired outcome depends on the social and political insights applied to the problem – and there is often a difference in opinion based on the individual perspectives of the observers, their opinion being based on how the system affects them rather than owner or operator intent!
Bureaucracy and Dilettantism
In 1924, Max Weber wrote that large scale organisations faced a choice between ‘bureaucracy and dilettantism.’ Bureaucracy, the dominant organisational form, is founded on the rationality of a system of rules and ‘offices’ (literally bureaux) with authority belonging to the office holder by virtue of occupancy of the office. This requires a systematic allocation of authority and, most particularly, adherence to the rules and the denial of personal influence or involvement.
‘It’s not me guv, I am just following the rules’.
Dilettantism, amateurism, a lack of professionalism is at best disordered, perhaps chaotic, authority residing in the might of the individual, whether that be based on size, intellect, financial control or any other means by which power may be exercised. We do of course sometimes see amateurish behaviour by office holders in bureaucracies but that is not the subject for today!
It is clear that the bureaucratic model is more likely to generate a stable organisation, one which is capable of fulfilling the purpose of its designer or owner. This model dominates western organisations and provides the underpinning thinking to all mechanistic systems – whether organisational or machines. The computer on which I am drafting this blog is bureaucratic, if it were not it would not work!
We have all experienced the benefits and limits to bureaucracy, the mindset that can be engendered within them and the undermining flawed assumption. A bureaucracy is predicated on its own totality – a system of offices, each occupied, each fulfilling it’s allotted task with impartiality, however, as Peter Dudley and I wrote in 1998:
“No matter how long the procedure chart, you never quite reach the customer”.
Incompleteness
In 1931, Kurt Goedel published his incompleteness theorems rooted in the philosophy of mathematics, proposing in essence that every formal language contains propositions that are unprovable within the limits of that formal language. Shifting from mathematics to organisation theory we can argue that bureaucracy is the formal language of organisation and therefore contains undecidable propositions.
In the attempt to deal with the incompleteness of the formal system, bureaucracy generates the mechanism of its own growth. If, as Peter and I suggest, the answer the customer needs always falls between two alternative already embedded outcomes then every time that happens, we (the actors in the system) must make a choice. We must either say ‘no’ and reaffirm the delusory completeness of the bureaucracy or devise an additional rule (or process) to address the requirement. The assumption of totality requires the bureaucracy to extend. In the first case we end up with a ‘jobsworth’ or ‘computer says no’ culture, in the second an inexorable increase in the number of possible rules and outcomes.
This inexorable growth in rules, built on increasing divisions, exceptions, work arounds and exemptions inevitably demands four increases in staffing:
1: because the rule set cannot all be remembered by an individual or adequately encoded in a process description, we need more and more people and greater and greater divisions of the task.
2: we need more and more people to manage the development of the rule book, audit compliance, investigate failure.
3: we need more and more people to manage the hierarchy of additional people now working in the organisation.
4: managing more people means more possible interactions, errors, alternative outcomes which means additional rules and, well, see 1, 2, 3……………….
The organisation, to sustain the illusion of order devotes more and more of its resources, its cash, its energy, to its internal maintenance, drawing them further and further away from delivery of its intended purpose. Stafford Beer called this ‘pathological autopoiesis’, analogous to a cancerous cell, it consumes more and more of the energy of the organisation to sustain itself leaving less and less to meet customer requirements.
Solving Productivity
In commercial organisations a brake on this growth is enabled by customer choice, if prices are too high, service too poor, the customer (eventually) buys elsewhere. In public and third sector organisations that brake is absent, demand is infinitely varying and unlimited, edge cases take disproportionate resource but have to be served in the interests of fairness and equity. The price is paid through increased taxation, through so called ‘postcode lotteries,’ through queues and waiting lists and the inevitable demand for more resources. A demand which when rooted in the bureaucratic system can seem quite legitimate!
There are a number of things that can be done to address this challenge.
First and simplest is to accept that any bureaucratic system is necessarily incomplete and to educate the staff in the exercise of judgement then allow them to use it. While this will generate some apparent inconsistency internally, and different judgements may be made by different people when confronted with similar questions, those judgements will be informed by those elements which are different, not those which are the same. The role of management then can shift to supporting the effective, fair, defensible and equitable use of judgement. That may require of all managers reliance on a moral compass and adherence to a clear set of values and ethics.
Second is to recognise that the bureaucratic model was rooted in a societal and technological context still operating largely at the speed of a galloping horse and with communication predominantly by written word, transmitted at best at the speed of a postal service. Telephony was in its infancy, organisational control was exercised at line of sight and the sound of a human voice. Control was local, autonomous, slow, written. 100 years later data (in unimaginable volumes) travels the globe at the speed of light, control is partly exercised by rules embedded in the employed technologies and at increasing distances. Requirements change at a hitherto unheard of rate driven by changes in fashion, style, legislation and environmental requirements. We do things the way we do them because those were the means available at the dawn of bureaucracy, they are no longer fit for purpose.
We cannot solve the problem by mechanising or automating the established bureaucracy but must reinvent the organisation itself as an adaptive entity and, in turn, reimagine the processes by reinventing the capture, storage, curation and manipulation of data. The mechanistically rooted bureaucratic model will no longer suffice. A reinvented organisation does not emerge from embedding existing processes in a digital device but by wholesale reimagination of the most effective means of delivering goods and services in a digitally native organisation.
The Intelligent Organisation
What is needed is an approach to organisation which is ultrastable (Ashby). That is one which does several things simultaneously:
it delivers current products and services to current customers, users and markets
AND
observes the emerging challenges and opportunities in the probabilistic future market and adapts itself accordingly
AND
uses information about its current and anticipated performance to improve itself, i.e. more of the desired outcome value for less input cost.
AND
sustains a clear sense of its purpose, the need it seeks to fulfil and the factors in its environment (social, market, climate, political) which give it legitimacy.
Reimagining and reinventing our organisations as digitally native will release resources to either increase throughput or reduce costs or, commonly, both. The challenges of productivity cannot be solved within the existing paradigm, they require us to synthesise bureaucracy with adaptiveness in an organisational form fit for contemporary needs – a digitally native organisation.