Bureaucracy is the Parasite to Productivity

By: Mike Teng
Submitted: 2007-01-17 15:36:28
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A parasite is medically defined as an organism that lives on within another organism at the expense of the host. Bureaucracy is an administrative system, which places undue emphasis on adherence to complex procedures and inflexible rules of operation. It is an administration characterised by excessive red tape and routine. This impedes effective action, slows down decision-making and adds unnecessary layers of costs. Bureaucracy is sometimes described as the tail wagging the dog and is a parasite to productivity. It is also like the millstone around one’s neck, limiting mobility.

Most of the large organisations have some form of bureaucracy. It is a given, inherent structure created largely by Alfred P. Sloan, who became president and CEO of General Motors (GM) in 1923. He recognised the need for coherence and unifying order when he confronted GM, a sprawling corporation that was in dire need of organisation. It was Sloan who transformed GM’s loosely configured, far-flung divisions into a coherent corporation. But while that organisational form worked well for many years, it had begun to become too restrictive as business became more demanding and more global in the 1980s.

Jack Welch told his people to “fight it, kick it.” Welch fought a two-decade war against bureaucracy with initiatives like “ boundaryless” and “Work-Out”. GE’s list of values specifically addressed the company’s intolerance for bureaucracy and it was at the top of this list for many years. Welch recognised the adverse effects of bureaucracy and knew that unless he rid the organisation of the worst of it, GE would never become a legitimate global competitor. He called bureaucracy “the Dracula of institutional behaviour,” meaning that it kept rising from the dead after being driven with a stake into it. He was concerned that bureaucracy was creeping back into the organisation. He hated bureaucracy, knowing that layers slow down decision-making. He delayered the organisation and removed the use of headquarters in order to help GE become more nimble and competitive. By waging “war” on bureaucracy and the old ways one movement at a time, Welch established a solid foundation on which he eventually built GE’s famed learning organisation

Margaret Thatcher, the former Prime Minister of United Kingdom (1979 – 1990) who privatised Britain Inc, the state-owned enterprises, did not support bureaucracy and consensus. She said: “To me consensus seems to be: the process of abandoning all beliefs, principles, values and policies in search of something in which no one believes, but to which no one objects; the process of avoiding the very issues that have to be solved, merely because you cannot get agreement on the way ahead. What great cause would have been fought and won under the ‘I stand for consensus’ banner?”

With privatisation, Britain Inc was able to cut back on bureaucracy and re-gain its natural corporate wellness. Many countries have followed Britain’s footsteps to privatise its government sector thereby minimising bureaucracy and boosting productivity.

If you desire speed and quick response to market changes, then the command-and-control bureaucracy is not the best way to run a business. It is more important to get everyone involved than adhering to a rigid hierarchy. Many companies are cutting down on headquarters’ bureaucracy as they are bogging companies down, stifling the units’ ability to reason and quickly decide. Business was moving too quickly and bureaucracy was strangling creativity and innovation. Gun down bureaucracy as it is the enemy of productivity.

Article source: Expert Articles