Bureaucracies temporarily reverse the Second Law of Thermodynamics.

An interesting post by Clay Shirky on the collapse of complex business models. This points to an issue which jumps out at me when I read the Moran Review on the Public Service.  How much complexity, how much subtlety, how much productivity is it reasonable to expect a large centrally directed monopoly institution with all sorts of constraints on it from without to achieve. Anyway, here’s a nice story from the middle of the post.

In a bureaucracy, it’s easier to make a process more complex than to make it simpler, and easier to create a new burden than kill an old one.

In spring of 2007, the web video comedy In the Motherhood made the move to TV. In the Motherhood started online as a series of short videos, with viewers contributing funny stories from their own lives and voting on their favorites. This tactic generated good ideas at low cost as well as endearing the show to its viewers; the show’s tag line was “By Moms, For Moms, About Moms.”

The move to TV was an affirmation of this technique; when ABC launched the public forum for the new TV version, they told users their input “might just become inspiration for a story by the writers.”

Or it might not. Once the show moved to television, the Writers Guild of America got involved. They were OK with For and About Moms, but By Moms violated Guild rules. The producers tried to negotiate, to no avail, so the idea of audience engagement was canned (as was In the Motherhood itself some months later, after failing to engage viewers as the web version had).

The critical fact about this negotiation wasn’t about the mothers, or their stories, or how those stories might be used. The critical fact was that the negotiation took place in the grid of the television industry, between entities incorporated around a 20th century business logic, and entirely within invented constraints. At no point did the negotiation about audience involvement hinge on the question “Would this be an interesting thing to try?”

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Craig Thomler
Craig Thomler
11 years ago

We are definitely seeing shades of ‘The rise and fall of the Roman Empire’ in the governance structures of the world today. However we are lacking the external factors (barbarians at the gate) to prompt change.

For the first time in human history the entire world has subscribed to similar authoratative governance systems – differences are at the margins (elected vs appointed sovereign national leadership) rather than at the core .

This greatly limits the need for states to evolve new governance forms or simplify practices that greater competition between smaller sociology-economic governance structures would require for survival.

So while we see economic entities rapidly evolving and pushing at the constraints of legal systems steeped in hundreds of years of tradition, governments are very slow and hesitant to change and tend to do so by building on existing structures rather than questioning their basic validity.

Examples of this abound in both Australia and overseas. Here we worry about the ‘queue-jumping’ boat people (a negligible fraction of immigrants) but do not consider whether the entire basis of the citizenship and immigration system are workable in a world where people can get anywhere in 24 hours and work anywhere in the world online. When the citizen and immigration system first solidified, the telegraph was the only global communications and news network and it took months to travel the world.

The same applies to censorship laws – we are debating applying 20th Century centralised network state-based rules on a global 21st century distributed network – as well as an R18+ rating on packaged games, when many games today are Internet-only with the majority of content generated on the fly by users. How do you rate them adequately using a 20th Century scheme at all when parts of games will fall into different classifications and the experience can change in seconds?

Reforming the public service is a noble and worthwhile cause, but what we really need to ensure government continues to meet society’s needs is a widespread ability to experiment with different systems and reinvent governance in an always-on, energy and water-challenged scenario.

If we don’t voluntarily try new models and approaches to organising (whether nations, organisations or much smaller units) voluntarily, we are approaching a scenario where we will be forced to do so in a most unpleasant manner as our current house of cards falls down.

Don Arthur
Don Arthur(@don-arthur)
11 years ago

I had to follow the link to Shirky’s post and do a bit of googling before I got the point. But it’s a really good point.

This is Joseph Tainter’s point about diminishing returns to complexity right?

Tainter talks about two aspects of complexity — structural differentiation and organisation:

Structural differentiation refers to the development of new categories of social roles, institutions, information, settlements, occupations, technologies, etc. Organization is how those are constrained so that they behave to form a system.

Over time the Commonwealth public service has created a huge number of organisational silos. And a lot of the complexity emerged from attempts to improve accountability. The driving assumption is that productivity improvements depend on holding managers and staff accountable.

Think about social services. In the past governments gave grants to charities. These charities had to account for how they spent the money, but they had a great deal of flexibility to respond to local conditions.

But over time government departments grew in size and the funding and delivery of social services became split across a range of departments and programs.

When senior managers wanted to improve efficiency, their first instincts were to:

1. Set clear objectives; and
2. Make performance against these objectives more visible.

In the process of setting clear objectives they constrained service providers. They didn’t want any of ‘their’ money to leak into the pursuit of another manager’s outcomes. They started to become much more prescriptive with service providers.

The process of making performance visible had two results:

1. Local managers and their staff began to spend increasing amounts of time filling in reports for all the program managers who funded their agency. You’d get case workers who’d spend more time doing paper work than seeing clients.

2. Local managers realised that they weren’t going to be rewarded for doing things that weren’t measured. If they held contestable contracts or funding agreements with government, they realised that their viability depended on playing the game.

The result is system of byzantine complexity. Service providers are increasingly organised around program silos. Consultations are organised around silos. And it’s now extremely difficult for people on the ground to do simple things for clients that were once easy.

Indigenous affairs is full of examples of this.

Paul Frijters
Paul Frijters
11 years ago

Don,

great reply. So true. I have been mulling over the same general observations for a while now and keep coming to the question of ‘why’. It is easy to spot the reasons within bureaucracies for doing this, but the question is why it didn’t happen before. What changed?

Gummo Trotsky
11 years ago

Hmmm – what about diminishing returns to complexity within political parties? Could the Liberal Party have reached the point where the only way forward is to collapse?

conrad
conrad
11 years ago

“I think accountability mechanisms for academics are generating the same kind of madness”
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That’s for sure. It’s also entirely destroying fields of research because they don’t fit the game for one reason or another, no matter how useful they are. In close to my area, a good example of this is computational linguistics. These guys almost never publish journal articles — that’s just the way it is in that field. This means that there are very few of them in universities excluding the States (where they don’t care as much about silly government rules), since they all start working for Google etc. because universities don’t love them, and those that there are are getting sacked. Of course, it’s hard to think of a more relevant area of linguistics these days. Now, you might not care about linguistics, but I’d hate think what is happening in other fields, like engineering, where they also have historically not published much. These guys then get replaced by people in other fields where people publish heaps, often for no other reason that there are lots of journals set up in their fields, and so you end up with a whole lot of people working on essentially the same topics (i.e., ones that fit the government rules). That’s bad for science all round.

Dallas Beaufort
Dallas Beaufort
11 years ago

And then we have, “competition policy reforms” which produced all the extra internal, so called performance based processes at greater community cost with no additional productivity, apart for the bureaucracies ability to understand and process these additional burdens which add to private sector process time lines with no additional quality, productivity or competitive position for industry when measuring real cost benefits. In fact only delivering the opposite result of complexity and larger bureaucracies.

Ken Parish
Admin
Ken Parish(@ken-parish)
11 years ago

I agree that managerialism, KPIs etc is a big part of the problem assuming I’m following what Shirky is saying).

Moreover, I think there’s a fairly clear chain of causation in relatively recent political history. Managerialism was a part of a phalanx of reforms deliberately pushed by “neoliberals” internationally through a range of very deliberate strategies which first became obvious in the 1970s in the wake of the collapse of the Keynesian consensus. It found fertile ground with politicians as diverse as Thatcher, Reagan and Paul Keating who were suckers for the Yes Minister propaganda image of a self-serving army of “Sir Humphrey” senior public servants who self-interestedly stifle policy innovation to preserve their own power base. It could be solved by a mix of outsourcing, privatisation and managerialist reform of the remaining public sector with senior managers on “performance-based” short term contracts. Like all great propaganda, the campaign worked because it contained enough grains of truth to recruit lots of politicians from mainstream parties of both left and right into supporting a quite radical reshaping of the fundamental nature of public sector governance.

Why? I’m sure there are multiple PhD theses in explaining it, and I’m equally sure lots have been written but escaped my attention. But one reason must be that the welfare/nanny state probably had reached a point by the early 1970s where it was overdue for a shakeout, and so a well-funded organised group pushing an alternative agenda had a good chance of carrying the day. These were ideas whose moment in the sun had arrived, just as happened for marxism 60-70 years earlier.

It’s possible that the outworkings of the GFC might result in governments revisiting the question of whether and to what extent McKinsey-style managerialist paradigms can ever work in anything like the intended manner in a public sector environment where real market signals are invariably lacking and where public interest objectives may not easily be quantifiable within a managerialist framework.

However, whether traditional public sector management structures were any more conducive to policy innovation or flexibility than managerialism is another question. Perhaps that’s where Nicholas’s Gov 2.0 stuff enters the picture, although it too can only ever be a small part of the answer (assuming that any answer exists).

JJ
JJ
11 years ago

I agree with all the above. However I would humbly suggest one other additional potential cause: a considerable enabler of complexity is IT capability. Before the age of computers, all this data collection and bureaucratic bumf would have been much more resource intensive. In the same way that ambassadors had much more autonomy before the advent of modern communications technology, I suspect that development of IT systems has removed a major barrier from bureaucrats being able to make things more complex. And we do.

Ken Parish
Admin
Ken Parish(@ken-parish)
11 years ago

BTW A big reason why I’m not more enthused about the potential of Gov 2.0 lies in my own perceptions about human nature itself. Phenomena like confirmation bias and perhaps even Jonathan Haidt’s notion of hard-wired moral predilections he calls “social intuitionism” suggest that many if not most of us (including Ministers and their senior advisers) are relatively impervious to evidence or consultative processes, even a process that underlines the complexity of factors impinging on policy choices and results in experts converging on “least bad” solutions through a careful but flexible moderation function that promotes civil dialogue.

As far as I can see, Stephen Conroy has had the benefit of an almost state-of-the-art Gov 2.0 process concerning his idiotic Internet filtering policy, but it hasn’t made a jot of difference.

Ken Parish
Admin
Ken Parish(@ken-parish)
11 years ago

They don’t need to admit they’re wrong. Any competent politician is more than capable of doing a policy backflip while claiming that nothing has changed or that it was all their own idea and the logical next stage of their previous position.

Is the market for talent really much more open in the MSM as a result of the blogosphere? I don’t see much sign of it even though I personally prefer some blogosphere pundits to most of the MSM commentariat (and spent quite a lot of time and energy promoting their virtues).

Will Gov 2.0 result in talented and energetic voluntary contributors to the policy debate being taken up? I certainly hope so but suspect any such effect is likely to be pretty marginal. Ministers will still mostly appoint consultants they expect to give them the advice they already know they want to receive and who have a “cachet” in existing networks of influence.

Moreover, while enhanced transparency and greater data release certainly can’t be bad things, I suspect that the extent to which such knowledge ever strikes the public consciousness with an impact that truly increases pressure on governments who do really dumb things is also pretty marginal. As I say, I’m not suggesting any of this is a bad thing, just that the potential can be overstated (a point you conceded in any event).

Gummo Trotsky
11 years ago

Phenomena like confirmation bias and perhaps even Jonathan Haidt’s notion of hard-wired moral predilections he calls “social intuitionism” suggest that many if not most of us (including Ministers and their senior advisers) are relatively impervious to evidence or consultative processes…

Ken, I’d suggest that the judicious addition of a little situationist psychology would be a worthwhile addition to the mix of ideas when we’re looking at human nature. The work of Phil Zimbardo is worth a quick one over. Right now, I think I’m up to thrice-over so it’s time to stop counting.

conrad
conrad
11 years ago

Ken,

I think managerialism became popular because it often works over short time spans — but in the long term it degenerates systems and you end up with the problems we have now. So the time-course generally looks good for a while, and once it goes down hill you start pretending it still looks good and simply ignore all the measures that make it look bad.
.
That’s probably fine if you’ve got, say, a 3-5 year contract, like, for example, most VCs in universities, almost all of whom are fixated on short-term quantitative goals like getting more students or getting the university higher up some silly measure. I also agree with JJ that IT has enable this — it’s so easy to come up with useless short-term quantitative figures now that look convincing to fools (e.g., our university moved from 484 to 456 on some crazy measure! wow! I must have done a good job! Who cares that the average age of the staff in my university went from 50 to 55, students learnt even less etc.?).

Paul Frijters
Paul Frijters
11 years ago

I agree that JJ points out an important driver of change in the actual reduced cost of inventing and disseminating red tape. Phillip Clark made the same point in the Australian (http://www.theaustralian.com.au/higher-education/opinion-analysis/in-most-forms-a-waste-of-time/story-e6frgcko-1225821367468).

I am not sure I buy the argument by Ken that the rise of the internal and external regulator is partly the result of some kind of liberal attempt to bypass the Sir Humpfrys of this world because you can see the same developments within industry. Whatever the set of drivers are, they are unlikely to be joined at the hip with a couple of political figureheads and the innate wish of any politician past or present to be in control. I would be more inclined to look at things like the number of lawyers a country educates, the number of bureaucrats hired in previous decades who found themselves with nothing useful to do and hence started to invent all this garbage to justify their existence, etc.

Craig’s comment #1 suffers from the usual caveat faced by those who call for radical experimentation with societal structures: who is the ‘we’ that is going to experiment with whole societies? There is no such ‘we’ because most of `us’ are not that dissatisfied with current structures and are thus only prepared to change evolutionary. As a German chancellor once said, whilst the dogs bark the caravan moves on.

Gummo Trotsky
11 years ago

I would be more inclined to look at things like … the number of bureaucrats hired in previous decades who found themselves with nothing useful to do and hence started to invent all this garbage to justify their existence, etc.

Ee lad, This don’t sound owt like my experience in the previous decade when I were working down’t bureaucracy. Every day we’d get up in mornin’ lick road wi’ tongue then go and work six hours and fiddle another four on flextime and spend most o time scannin Commonwealth Gazette lookin for jobs on organisational review teams so we could some other poor buggers job and get usselves a promotion.

Strange but true: not once in that whole era of public service reorganisation did any of the numerous organisational review teams looking for “dead wood” to cut ever report that their own positions or job functions were surplus to requirements.

Gummo Trotsky
11 years ago

Craig’s comment #1 suffers from the usual caveat faced by those who call for radical experimentation with societal structures: who is the ‘we’ that is going to experiment with whole societies?

That’s a good question. I’m going to nick that idea for an article I’m working on.

conrad
conrad
11 years ago

Strange but true: not once in that whole era of public service reorganisation did any of the numerous organisational review teams looking for “dead wood” to cut ever report that their own positions or job functions were surplus to requirement”

Once, whilst travelling in Nepal, I met a retired UK diplomat that had worked in India for many years (quite an impressive guy — he spoke both Hindi and Nepalese). Whilst walking with him for some time, I found out that his last job was to find people to make redundant, and that he not only got rid of himself, but gave himself his own redundency package also. So there’s at least one case (although his main job was a diplomat, so perhaps he doesn’t qualify).

Gummo Trotsky
11 years ago

conrad,

I salute this nameless hero! He deserves some sort of memorial.

Here in Oz, the public service cost-cutters were nowhere near as principled (or am I confusing creativity with principle?)

Paul Frijters
Paul Frijters
11 years ago

Gummo,

:-) be my guest and thanks for telling me. Theft is the highest form of flattery.

Gummo Trotsky
11 years ago

Paul,

Naturally I shall pass it off as subsequent simultaneous invention. Or perhaps preemptive plagiarism on your part. Probably the latter.

JJ
JJ
11 years ago

A quick thanks to Club Troppo for the reference to “The Collapse of Complex Societies” in the Clay Shirky post. I’m just finishing reading it and it is excellent indeed.