Saturday, April 6, 2013

Bureaucracy - You Can Cut Excessive Red Tape without Cutting the Umbilical Cord.

Good bureaucracy does exist. The military can respond quickly on the frontline. A business can make a fast, sound decision that is beneficial to the company. A large group of people can feel empowered, motivated, and positive towards fulfilling that group’s common purpose.
Why is it when you think of a bureaucracy right now, you are thinking paperwork, waiting in long queues, and you find yourself already drained and exhausted? Why does it often feel like life is being sucked out of you? You feel dis-empowered  uncreative, stifled, frustrated and you hope it’s going to change. We often reflect on the nature of bureaucracy and give up hope.

A bureaucracy, from the definition I saw at is inherently negative as it is about, ‘excessive red tape and routine’. Red tape and routine are fine; good governance is not the problem here. The issue is not whether administrative boundaries are needed, the question is, how many administrative boundaries do you need before it is excessive?

Let me give you a few examples.

The accountant meets with a store manager, and they discuss the implementation of this year’s budget. The budget is decided upon, and expenses relevant to the store are budgeted for and agreed upon.

The store manager, a few months later, intends to spend money on the advertising that was budgeted for. The manager is told that approval is needed to spend over $2,000. Permission must be granted. Now some may say, this is simply good governance. I say that the second step in this process is unnecessary red tape. The advertising was agreed upon during the budget process. Why this extra step in the process? I’ll answer that question in a moment.

I once worked closely with a Non-For-Profit, with a lady who was the manager of a particular Outside Hours School Care Service. There were two other employees at the service, of which she was in charge. She had to get permission from her head office to purchase a $30 board game from Target for her after-school program.

Remember the Australian Government helping to administer donations that came through the Red Cross following the flood emergency in Queensland? There was so much red tape that families took months to receive financial assistance during the crisis.

What about Motor Vehicle organisations and the plethora of forms that must be filled out to apply for car registrations?


Let me ask two questions related to bureaucracy.

What is the effect on business and individual performance in an excessively bureaucratic business/organisation?

Why do we in fact have excessive red tape (bureaucracy)?

Firstly, from my experience (practically and from discussion with others) excessive red tape causes the following problems in an individual:
  • Decreasing intrinsic motivation
  • Stifling of the creativity within
  • Negativity towards the organisation
  • A growing feeling of worthlessness
  • A mindset that the overall organisation (whether true or not) is one that is slow to move, stubborn, passively aggressive and resistant to change

The effect, from my opinion, that bureaucracy has on an organisation as a whole is the following:
  • Creates a high level of distrust in the organisation
  • Stifles creativity within the individuals
  • Can cause very slow, clunky, decision making
  • Fosters conservative financial spending
  • Creates a culture of cautiousness
  • Only tried methods are allowed, the rest is resisted, frowned upon and by no means encouraged
  • A resistance to change is developed (because of the bureaucracy!)

I want to come to a fundamental question in this discussion. Why do we in fact have bureaucracy? Or rather, why do we in fact have excessive red tape?
Let me come back to example one. Head office had agreed with the store manager, during the budget, that $2,000 would be spent on advertising. So why is there an extra step in the process?


The issue is surely a fundamental lack of trust in the store manager. A trust firstly from an integrity point of view (that he would spend and only spend that amount on advertising) and secondly trust in the man’s competence (that he would spend the amount on the right type of advertising).

This bureaucratic step in the process is there to safeguard the organisation against stupidity.

Can I ask why in the world would you employ a store manager if deep down you don’t trust that store manager? Now, do one of two things. Either fire the manager because you don’t trust him, or allow him to freely spend money that has already been budgeted for and agreed upon at an earlier date.

I understand, not all bureaucracy is related to trust. Some red tape exists to merely administrate a business. Though excessive red tape that exists because we have lowered the administrative bar to the lowest, most untrustworthy employee, will stifle the organisation!

Inherently trust people.

Let your administrative processes reflect trust, creativity and empowerment.

Rid the business of needless process.

People will only rise to the level you put the bar of trust. 


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