Platt Perspective on Business and Technology

Intentional management 24: contextual management 2 and the bureaucratic extreme

Posted in HR and personnel, strategy and planning by Timothy Platt on September 25, 2015

This is my 24th installment in a series in which I discuss how management activity and responsibilities can be parsed and distributed through a business organization, so as to better meet operational and strategic goals and as a planned intentional process (see Business Strategy and Operations – 3, postings 472 and loosely following for Parts 1-23.) This is also my second installment within this series on an approach to management that I have come to refer to as contextual management.

I began a more formal and detailed discussion of what contextual management is, in Part 23 of this series. And to summarize its core definitional message, I repeat a set of organizing points that I first raised there:

1. If the goal of intentional management is to arrive at and follow a standardized best practices management approach that is optimized for the specific business and its circumstances,
2. The goal of contextual management is to add adaptive flexibility into those intentional management systems, and structured allowance for exceptions and course deviations as need for them arises.
3. While intentional management as a basic approach is about structure and consistency, contextual management is included to add flexibility and resiliency, where a more rigid and unaccommodating alternative to this combination would be less likely to effectively, sustainably work and certainly long-term and in the face of change.

Then at the end of Part 23, I stated that I would continue its discussion by turning to consider “organizationally rigid bureaucratic systems and how ad hoc decisions leak through that rigidity as a sometimes one and only path to allowing any flexibility at all.”

Basically, what I seek to address here is the predictable set of consequences that can and do arise when all effort is made to adhere to any rigidly immutable set of established “best practices” and with no flexibility or exceptions allowed – and with no room allowed for organic evolutionary change. And beyond that, my goal here is to at least briefly discuss how these systems can and do arise, and as the most likely organizational systems for at least certain types of contexts.

I begin this by at least briefly outlining what a bureaucracy is, or rather what this organizational form is as I use that term in this context.

• A bureaucracy is an organizational system that is overtly operationally rigid in always following one process and approach, for any and every task and circumstance that it would address, in meeting its organizational goals.
• These systems are generally rigidly hierarchical in their organization and with established and immutable chains of command in which a priority is placed on compliance to proper procedure. And performance is evaluated according to compliance with that one approved and allowed process standard.
• These systems are usually paperwork and online forms driven as a mechanism for containing processes and practices followed, within their one accepted official pattern.
• And this ongoing documentation also serves to verify that everyone performing in these systems remain in total compliance, so this ongoing documentation serves an individual employee protective function too.
• And these systems, by their very nature fail to officially acknowledge let alone accept the legitimacy of exceptional situations, or of circumstances where flexibility might offer greater value. This, among other things, means they do not capture opportunities to change and evolve very easily, if at all.
• Any deviations from official procedure and prioritization are, and are seen as risky and they are viewed at least officially as being damagingly wrong. And any formally entered into deviation from the one true permitted approach of this type of system, would be seen as creating direct and consequential risk, and for anyone in that system who would attempt to perform or to justify such divergent action.
• So any deviations of any sort that are made from the single standard process-driven approach that governs, are usually carried out as ad hoc exceptions – and they are not recorded for what was actually done,
• And even if they, for whatever reason, are recurringly repeated and as the only actual way to complete some set of recurring task requirements.

How do these systems arise? Look to where they do, and you will find an at least strong source of hints and suggestions as to how they do, in answer to that. Government bureaucracies come immediately to mind as a source of working examples. They are slow and they are inefficient and the people who labor in them at least seem to reach a point, for the most part, where they are simply doing their jobs and they do not care about the consequences of that to their customers – their stakeholder clients.

Let me add a fourth numbered point to my above definition list, with this in mind:

4. A true bureaucracy can only survive and thrive long-term in the absence of any real competition. As soon as it begins to face competition it is going to begin to see loss of revenue and business for precisely those areas of its market-facing services where other organizations can compete with it, and according to more agile and flexible, and consumer-accommodating business models.

Consider national government run postal services as a source of working examples there, and to be fair and as a United States citizen I will focus here on the US Postal Service – a government run and operated business, for all intent and purpose, that in recent decades has seen much of its business and much of what would potentially be its most profitable lines of business, taken away from it by private sector businesses and with that driven by technological and legislative change that have made this competition possible.

Email and other technologically driven change have significantly eaten into what would be first class mail delivery for essentially every nation with any significant online connectivity infrastructure in place. Private sector parcel post delivery has been increasingly taken over by private sector delivery companies that can offer levels of flexibility in both pick-up and delivery that government run organizations would be hard-pressed to match. And for many countries, and with the United States as a clear example, this has led to an increasing percentage of their business coming from the delivery of bulk rate advertising fliers, catalogs and similar marketing and sales material – that is often not actually wanted by its recipients and that offer low per item, and per pound weight profit margins for their delivery. Most national postal services lose money, and as a basic trend lose more every year than they did the year before.

The United States Postal Service is one of a small number of services that is explicitly mandated by and required by the United States Constitution (through its Article 1, Section 8, Clause 7: Postal Clause.) So this particular bureaucratic organization will persist long-term and in spite of its inefficiencies and its ongoing revenue loses and resulting red ink. And as a government agency, it will most likely remain, fundamentally a rigid bureaucracy that only allows very limited and selective flexibility – as permitted and pushed through as special legislated exceptions. And that assertion applies with greatest force at a management and organizational level. And it breaks down into a more humanized ad hoc allowance for exceptions (where and when it does) when members of the public face and deal with their own local postal delivery men and women and with their local post office staff who they get to know personally and who they interact with on virtually a daily basis.

Congress sets postal rates as a matter of formal legislative process and their approval is needed in order to make any changes on those rates. Personnel are hired, advanced and promoted, and retained or let go according to civil service law and practices, which constitute an entire vastly large separate bureaucratic system in and of itself. The placement and working hours of post offices and other system facilities are bureaucratically administratively determined, and so are their overall operational processes. Flexibility enters the Postal System at the interpersonal level and through ad hoc decisions to be flexible and accommodating – not through processes or practices that are in any way formalized – except in how individual postal workers can and do selectively decide which approach would be best on their own initiative and on a case by case basis.

A postal carrier knows that a family on their delivery route, who they have been delivering mail to for years is suddenly going to be away and that they are expecting a package that would have to be opened immediately and its contents refrigerated. They have asked that their mail delivery be put on hold but that this particular package be left with their next door neighbor, rather than being put in unrefrigerated storage at the local post office branch. This package that calls for immediate opening arrives and while standard operating procedure would have this put in storage with everything else for that family, it is brought to that neighbor as requested and as an ad hoc exception. And a family that suddenly has to be away for a few days does not lose an important delivery of mail-order medication as a result – and according to formal guidelines this postal employee is probably violating multiple explicit rules and procedures in place from accommodating these people in this very human way.

Bureaucracies are like this, and if they are to function effectively at all, ad hoc decision making on the part of their employees have to follow the above-noted pattern too. And if the US Postal Service were forced to compete unprotected in an open marketplace and for all delivery services, it would be eaten alive by its more agile and flexible competition. But the US constitution mandates that this US federal government service be maintained, and legislation does for example bar private sector competitors from delivering first class postal delivery mail – the last remaining profitable area of its overall business for which it holds a monopoly.

The businesses that I have worked with and that I write of in this blog are not in general, so rigidly inflexible for their formally allowed processes and practices, and they have not been so protected from outside competition. Flexible agility and the capacity to both pursue and acknowledge it, and to learn from it are essential and certainly where a business or organization would face real competition head-on. Contextual management or something very much like it is essential, and for most businesses if they are to survive and thrive.

I stated at the end of Part 23 that I would follow the above discussion of rigid bureaucracies with a matching discussion of more entirely ad hoc and essentially rules-free organizations, as I have seen attempted and particularly with some of the more loosely organized startups that I have seen close up. If this posting has been a discussion of the consequences of attempting something like intentional management without a contextual management component, my next installment will be more about attempts to take a contextual management approach without an underlying established intentional management foundation. And after that, I will at least briefly discuss how a business can strategically pursue a more balanced middle ground. Meanwhile, you can find this and related postings at Business Strategy and Operations – 3 and also at Page 1 and Page 2 of that directory. Also see HR and Personnel and HR and Personnel – 2.

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