Systemic Rigidities in Modern Management 1 - Setting the Scene

In Problems of redundancy and systemic failure I pointed to what I saw as a disconnect between the way organisations were organised and the way people worked. In this post I want to extend my argument using a generalised public sector case study.

Consider a modern public sector organisation.

This has a corporate plan that is meant to describe what the organisation will do over a five year planning period. Each year a business plan is prepared, describing activities over the following twelve months. The individual units within the organisation prepare their own twelve month business plans. There are also a series of published policy statements and strategies setting out approaches and aspirations in particular areas.

The organisation is headed by a CEO. There is a departmental executive that meets regularly to consider policy and operational issues. Each major unit within the organisation has its own executive that also meets regularly to consider policy and operational issues within the unit. Because Departmental activities can cross units, there are a variety of coordinating measures in place, including standing and ad hoc committees as well as standardised consultation procedures.

Activities are monitored and controlled through standardised monthly reporting procedures that measure results against plan. The CEO has a performance based contract with the Government. Very senior staff are also on contract. All staff are meant to have performance agreements that cascade down the hierarchy.

The organisation operates in an area that can be politically sensitive. For that reason, there are a series of rules and procedures governing external contact including the media. These include clearance procedures for every public piece of official paper whether in physical or electronic form.

The organisation manages substantial assets and has a significant revenue stream. A range of measures exist to prevent fraud and ensure probity. The organisation has also adopted project management approaches with a defined cross-organisation methodology.

Apart from its own internal policies and procedures, the organisation operates within a complex web of centrally defined policies, procedures and reporting requirements intended to govern broader public sector activities.

I suspect that this description will sound familiar to many. It all sounds so reasonable. Yet the problem is that the system does not work very well. Part of the reasons for this reflect the unique features of the public sector environment, part are common to all organisations.

In my next post I will look at the public sector features.