Insanity Bureaucracy Essay

Insanity – Bureaucracy, What’s the Difference?
By Ben S. Graham, Jr.
Chairman
The Ben Graham Corporation
Copyright 2006, The Ben Graham Corporation. All rights reserved.
Permission is granted to post, print and distribute this document in its original PDF format.
When an individual consistently behaves in a way that is clearly out of touch with reality,
we describe that person as being; not of sound mind, mentally deranged, insane. But
when an organization consistently establishes work processes that are out of touch with
reality, we don’t call the organization insane. We call it bureaucratic and put up with it
as if it were a necessary evil of organizational life. It is not.
The principal cause of bureaucracy is that rules of work (which must be followed whether
they make sense or not) are developed at a distance from reality. And, the primary
reason for this distance is that work processes are interdepartmental. They flow through
departmental boundaries with ease. Therefore, to find a person with enough authority to
revise a process means moving up in the hierarchy several levels away from the work.
The people who are closest to the work and have the best handle on the reality of the
work can only make limited fixes to the work. Desk tidying they can do, but anything that
would have an impact beyond their work area is outside of their authority.
Of course many changes are made to processes within operating level work units. When
they are made, care is usually taken to make sure that the work leaves the area in the
same format that it has been so that it will not cause problems in the next work area that
receives it. Often this means retranscribing some of the data or maintaining double
records. As these local changes accumulate, a process becomes increasingly
cumbersome and subject to breakdown.
Occasionally, concern for a process reaches the level of the organization where authority
spans the entire process. This concern may occur because the process has broken down,
or it may occur because of some major change in the organization, or a change in senior
officers. It could be something as simple as a senior officer being sold on something he
saw at an equipment show, heard about from a consultant or read about in a business
magazine. It doesn’t matter what raised this concern, the key issue is that the concern is
at a distance from the reality of the work, the reality that is known only to the people
doing the work. But it is at this senior level where we find the authority to change the
work of an interdepartmental process.
Now, it would make perfectly good sense for the senior people, when they are concerned
enough to repair or replace a process, to seek advice from the people who know the most
about that process. But do they? Traditionally not, for various reasons. For instance;
1. Senior managers fear that the operating people will be defensive and want to
keep doing the work the way they have been doing it. In my 45 years of working
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2.
3.
4.
5.
6.
with veteran employees, I
have not found this to be
true. In fact, I have often
heard complaints like this.
“The last time they revised
this process, I thought they
got it about as bad as they
could…but I was wrong.
Look at what they have done
this time.”
Senior managers may feel
that the people doing the
work are the ones who messed up the process in the first place and therefore it
just doesn’t make sense to go to them to fix it. There may be some truth here to
the extent that the operating people have injected limited fixes into the process
that have made it more cumbersome and vulnerable. However, this is because of
their limited authority. The senior manager can change that. He or she has
authority that spans the process and could use that authority to form a team of
operating people whose collective experience also spans the process.
Sometimes senior managers want to keep a process renovation project a secret to
prevent employees from worrying about changes that might affect their jobs.
Often, but not always, these managers have every intention of making sure that
their employees will be well taken care of – that is not laid off. In fact, word of
these secret projects almost always gets out and the concern of the workers is far
greater when they get wind of this project than it would be if it were presented
openly. This type of activity sometimes backfires as some of the best employees
(those who would have the least difficulty finding another job) see the writing on
the wall and leave. Secret projects, in this way serve to purge an organization of
outstanding employees.
Senior managers may get caught up in the excitement of some new technology
that they have heard about. This is something they will bring into their
organization and naturally they have to go outside the organization to get it.
There is nothing wrong with going outside the organization. In fact ideas and
concepts for a new process can come from anywhere. But, they should never be
injected into an organization without a reality check. The process should be
studied and revised by the operating people and when it takes technical
knowledge that they don’t have, this calls for adding another person to the team,
not turning the project over to them.
Another thought that can prevent senior managers from turning to their operating
people is a stigma attached to the idea of a homemade solution. Clichés like ‘you
get what you pay for’ can lead to spending a great deal of money to get a process
that is not nearly as good as what the employees would have come up with. And,
after a great deal of money has been spent on a poor solution there is a tendency
to want to force it to work.
Of course, sometimes the intention of senior management is to downsize and they
can hardly expect their employees to use their ingenuity and experience to work
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out a new process that gets them a pink slip. There are many drawbacks to using
process improvement to downsize and perhaps the worst of these is that it firmly
links process improvement and job loss in the minds of the work force, which
creates a formidable impediment to future improvement. Process improvement
should be done to make processes better; faster, more accurate, more complete,
easier to work with, etc. When this results in needing fewer employees, those
senior officers who realize that the continuing loyalty and trust of their
employees is vital to their long term success choose to earn that loyalty and trust.
They come up with innovative ways of avoiding layoffs by using attrition,
transfer, spawning new businesses, expanding the current one, etc.
7. Another twist on downsizing I have run into is where senior managers get some
of their employees aside and let them know that there will be a reduction in staff
but assure them that they will not be among those dismissed. This has been used as
an approach to getting employee involvement while downsizing. I suppose there
are people who would see no ethical problem with this. I do, and our Company,
which has been working in process improvement for over fifty years, simply does
not work with companies that are using work improvement to downsize.
8. There are also senior managers who rather than downsize, simply want to get rid
of their current high priced, senior employees and replace them with lower priced
new employees who are younger and more receptive to new technology. I have
found that employee experience is far too valuable to cast aside in the pursuit of
technology. Experience and technology are both crucial to world class
operations. Arguing over which is more important would seem fruitless. They
are both vital.
9. Senior managers may be convinced that operating level employees from different
departments would not be either willing or able to work together to build an
effective process. This is a powerful self fulfilling prophesy through which the
senior managers, unfortunately, deny their employees the opportunity to ever
show that they can. Suffice it to say, I have watched such teams cooperating
enthusiastically and designing excellent work processes for over forty years.
10. And, even senior managers who are inclined to turn to their employees for
process improvement may be reluctant to do it because they are concerned that it
would take much too long for them to do it. In fact, since the employees already
know the work better than anyone else in the world they can improve it far
faster than outsiders while working with far more information, information that
they thoroughly understand.
This is not an exhaustive list of rationalizations for ignoring employees when working on
processes. It is just a sampling of what is behind this “Amazing Oversight”.1
What should we do to get the best world class work processes? Use organized common
sense, the Work Simplification approach. This means chart the process, at a level of
detail that shows all of the steps that people take to process each of the records in the
process. This detailed process chart provides a well organized and comprehensive
display of the work that the people do in the process, something that is thoroughly
familiar to the employees who do this work. Then form a team of veteran employees
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whose experience collectively covers the entire process. If there is technology involved
in the process that the team does not understand simply pull up another chair or two and
have people join the team whose experience covers these areas. And, they join the team as
equal members. They don’t take over the project.
How long should this take? Well, making the chart is a day or so. If the process is one
hundred steps it should be charted in one day. Then have the team review the chart and
revise it. After three or four meetings they should have a new chart representing the new
process in precisely the same detail. With the two charts you have an “as-is” and a “tobe” and a simple reconciliation between them produces a list of the differences that are
the specific recommendations for change, each of which can be easily analyzed for
benefits and cost. These recommendations are then presented to management for
approval and those approved are assigned for implementation. Bureaucratic rule making
at a distance has been replaced by realistic process design accomplished by the
employees.
In this way we tap into reality which
is found in the experience of
employees, the most valuable
resource in any organization. And,
when we tap into this resource we
may hear from employees as I have
heard many times, “It’s about time
you finally asked us. Now we’ll fix
it for you.”
1.”The Amazing Oversight” is the title of a book I co-edited in 1979, published by
AMACOM (a division of the American Management Association). It is a collection of
the writings of 14 people who were authorities on participative improvement at that time.
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Assignment #4
Due June 28, 2021 by 11:59pm
This is an individual assignment.
Requirements:
1. Please read article 2. Summarize this article and in detail please explain your stance on
the need to chart a process in order to improve it. Please use examples and references
when applicable. No more than 500 words
Please submit your assignment to the dropbox for Assignment 4.
Note: there will be a penalty of 10% per day for late assignments
Marking Rubric
For assignment one, you will be marked on the following:
/19
• Free of spelling and grammar errors / 5
• Clear summary of the article /4
• Well thought-out arguments /3
• Valid conclusions are presented
/2
• Logical structure
/2
• Information is cited /3
**Grades of 0 will be given for plagiarism / copying / or any other type of submission that is deemed not
your own

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