Monday, January 31, 2011

Bureaucracy and Risk

@jasongorman Bureaucracy doesn't reduce the risk of making mistakes, it reduces the risk of making decisions.

retweeted by @ashalynd @barendgarvelink @carloslemes @claussni @fabiogasparro @fabio_nb @fpaiano @jerrygulla @jonmholt @keesvandieren @KevlinHenney @mfeathers @MrAlanCooper @Richardgab @rmHeise @rpepato and others.

As a general rule of thumb, I hold that when one makes statements about risk one should specify whose risk you are talking about.

Bureaucracies typically evolve procedures for making decisions, which may help to eliminate certain types of error, but may make other types of error more likely. Bureaucracies also evolve responsibility structures that reinforce certain modes of decision-making and action, and inhibit others.  At least in the short term, employees take less personal risk when they conform to these procedures and structures, even when the decisions have bad consequences for other stakeholders, and may create longer term problems for the organization itself. 


@richardveryard When a person makes a decision within the rules of a bureaucratic system, the system protects the person from risk.

@ashalynd True, but then the success of the whole organization depends on how good are its rules.

There are various ways of viewing the short-term or long-term success of an organization. Again, we need to ask - success for whom, from which perspective. Inflexible organizations may appear to be successful in the short term, but if they lack requisite variety, they will fail to respond adequately to changes in their environment, and may ultimately become non-viable. 


For a rule-driven organization, the flexibility (requisite variety) depends on the degree of agility and intelligence that is embedded in the rules and their interpretation. I guess this is what @ashalynd means by the quality of the rules. It is not impossible for a bureaucracy to have some degree of agility, but rules usually leave a lot to be desired.

@richardveryard The success of the whole organization depends on the fit between the structure of rules and the structure of demand.

@jasongorman What does that mean - "the structure of rules" and "the structure of demand"?

The ability of the organization to behave in an agile and intelligent way depends on whether the flexibility (degrees of freedom) built into the rules and other working practices is aligned with the kinds of direct and indirect value (demand) which the organization needs to deliver. The question of alignment is ultimately a structural question.

The Power of Principles (Not)

Discussing The Enclosure of the Commons with @umairh.

@umairh Here's some more stuff we can pimp--oh, sorry, I mean "privatize"--while we're at it. The atmosphere, the oceans, our grandkids. Oh, wait...

In response, I pointed to @owenbarder 's blog Enclosure of the Commons – 21st Century Edition.

@umairh Exactly. That's why fighting back with "open-source"/commons principles is so disruptive--and important.

But the history of enclosure doesn't suggest that it can be defeated by "principles". Wikipedia: Enclosure. Fighting back may be important and disruptive, but surely disruption needs more than principles? After all, people have often defended enclosure with another set of equally plausible principles - protecting the environment, increasing agricultural productivity, or whatever.



Here's a more general question - to what extent have "principles" ever contributed significantly to social or political change. Many key historical changes - examples might include the abolition of slavery in the USA, the enfranchisement of women, and the independence of India - were heralded by strong and principled campaigns. But why were these campaigns more successful than those against enclosure?

We might note that in each case of successful progressive change, there is an alternative explanation for the event, based on socioeconomic and geopolitical forces. For example, with the availability of cheap quinine (reducing the economic dependence on labour of West African origin), slavery ceased to be the cheapest form of labour in malaria-ridden plantations. Such socioeconomic explanations should caution us against regarding the forceful articulation of principles as the sole driver of social change.

In business and engineering, as well as politics, it is customary to appeal to "principles" to justify some business model, some technical solution, or some policy. But these principles are usually so vague that they provide very little concrete guidance. Profitability, productivity, efficiency, which can mean almost anything you want them to mean. And when principles interfere with what we really want to do, we simply come up with a new interpretation of the principle, or another overriding principle, which allows us to do exactly what we want while dressing up the justification in terms of "principles".

The BBC Moral Maze programme this week discussed a recent case of a Christian couple in the UK who refused bed-and-breakfast to a gay couple, thereby offending against recent anti-discrimination legislation. This case appears to involve two conflicting applications of the same principle - tolerance and human rights. Listening to the programme, I thought how easy it might have been for the Christian couple to turn away guests they regarded as undesirable by appealing instead to the principle of security, and how often "security" and "risk" is used as a reason for being unpleasant or unhelpful to other people. I also remembered FakeSteveJobs' recent rant against Christian intolerance, in which he offered the following interpretation of the Good Samaritan story. "Jesus, your big hero, was saying that if you have some rule or conventional wisdom that causes you to do harm to people, violate the goddamn rule." [FSJ December 2010]

So much for principles then.


I have previously written about the over-emphasis on principles within the discourse of enterprise architecture: What's Wrong With Principles