I found that bureaucracy correlates positively with the size of an institution and/or corporation: The bigger an institution and/or corporation, the more bureaucracy there is. Large institutions become increasingly inflexible and risk averse, because they have this unfortunate tendency to overvalue what they own and focus on what they may lose, rather than what they may gain. "We've always done things this way" becomes a major obstacle to innovation. The business model becomes sacrosanct, with bureaucracy being its inquisitor. Doubting it obviously makes you an heretic. I will never forget a so-called "innovation workshop" I once attended in a rather big company. The opening statement of the VP in charge was "OK, let's be innovative today. But remember not to touch our successful business model and don't mess with our corporate identity". When CI doesn't stand for Corporate Identity anymore, but for Corporate Inquisition, corporations run into massive problems.
Trust is another big factor. When managers don't trust their staff - often because they don't take the time to get to know them - many will try to control everything. They micromanage and bureaucracy takes off. The employees will react by disengaging and not trusting their managers either. A vicious circle!
Hi Achim, thanks for your very thoughtful contribution--love the quote from the VP! I've also found that bureaucracy becomes worse as a company increases in size--and layers of managers get added, new silos get created, and new roles get introduced. Why do you think that is? Is there anything we can do to inoculate growing organizations from the sclerosis of bureaucracy?
thanks
Michele
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Thanks Michele. In a way, the traditional organizational structure of a corporation, i.e. the pyramid, is the culprit. When companies grow, managers get added as you mentioned. They need people that report to them, otherwise the pyramid would collapse sooner or later. In this type of structure, internal power and influence is dependent on the number of people reporting to you (as well as the size of your budget). When thinking about promoting someone, the first questions tend to be "How many people are reporting to her/him?" and then "How big is her/his annual budget?". Managers will start behaving like Pavlov's dog, they have been conditioned not to rock the boat and to focus on moving up in the pyramid. They will try to increase their headcount, regardless of whether these new people add value and productivity or not. Sooner or later more people will wind up doing less work in total, bureaucracy feeds on itself. In this type of culture there is no room for change, creativity and innovation.
One obvious possible solution would be to "re-condition" managers by rewarding them because they add value, because they promote sensible change, because they rock the boat and look for new business models. A CEO once told me that he expects his managers to make their present functions redundant. That is the right attitude.
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Another pernicious effect of bureaucracy is that it lulls people in. After a while, it becomes "comfortable" to hide behind bureaucratic rules. They become the perfect excuse to dodge personal responsibility. After all, who are we to question the system? When is the last time you heard "Don't blame me, I only work here"?
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Want to find bureaucracy? Meetings are a great place to look.
As Peter Drucker wrote in "The Effective Executive": "The more overstaffed an organization, the more it relies on meetings" and "Sitting in meetings doesn't mean that you're terribly important. It means you're not working".
To this day, many corporations obviously disagree. For example, I had to get a go-ahead from a senior VP some years ago. So I called his assistant and she told me that his calendar was full for several weeks. As it was rather urgent, she suggested that I could catch him the next day at 13:00 sharp on his way to the parking lot, as he had to drive to - you guessed it - another meeting.
To make things worse, time and resources aren't only wasted in the meetings themselves, but already beforehand: Organizing the meeting room. Determining the participants. Creating a bloated PowerPoint presentation (often by someone, who is not allowed to the meeting). Drawing up and agreeing upon the - often political - meeting agenda. Prior, personal presentations to selected participants, again often politically motivated. Of course, someone also has to do the minutes of the meeting afterwards.
Meeting cascades also tend to be very popular: It starts with a board meeting on Monday, the next level in the hierarchy meets on Tuesday, the next on Wednesday and so on. Trickle-down effect? Good question!
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