Too Big To Function

Go back to early Chinese history, the Roman Empire, the writings of Karl Marx or Max Webster and you will find that bureaucracy has always existed. It exists at the family level with parental hierarchy. It exists in military regimes through command and formation. It exists in manufacturing plants with process and controls. And it exists in public service organizations through rules and risk management.

And it exists for good reason.

Traditionally, a bureaucracy establishes the most efficient and rational way to organize human activity through a series of standardized rules and processes deemed necessary to maintain order, control risk, limit irreverence and control messaging. It has been the administrative system that governs pretty much every large institution in our country. And until about 30 years ago, it was a relatively effective organizing mechanism and management structure.

But then our population curve and our technology adoption curve started to turn upwards, and our bureaucracies expanded to meet the needs of the expanding bureaucracies instead of meeting the need of their customers.

And the criticisms heightened. Bureaucracies were frequently blamed for longwinded processes, slow decision-making, unnecessary approval steps, inflexible procedures, absence of creativity, lack of organizational personality, lack of individual empathy, convoluted practices, political interference, and the inability to empower front line staff to solve problems.

Bureaucracies are a control-based and rules-based operating system, like Microsoft, when really the whole world just wants to be working with Apple.

Don’t get me wrong, Microsoft will always exist and bureaucracies will always exist. Microsoft had its day in the sun, and bureaucracies have had their day in the sun. Microsoft loosened its control, and bureaucracies must loosen their control. Microsoft underwent an excruciatingly painful and costly re-inventive change process, and it is time for bureaucracies to do so as well.

Yes, it is time.

The fundamental tenants of bureaucracy are rules, process, hierarchy and control – the very essence of centralized conformist management theory – and the antithesis of creativity, innovation, customization and flexibility demanded by today’s informed customers.

Most bureaucracies follow a standard formula: policy gets announced by politicians, strategy gets set at the top, directors control risk, managers supervise a portfolio of projects, tasks are given to front line workers who deal with the customers, and administrative coordinators schedule and record the activities. The whole bureaucratic system is set up to control power and authority, centralize knowledge and decision-making, eradicate all risk and invention, trickle down responsibility without authority, govern through processes and rules, and discount any accountability for results.

No wonder bureaucracies are riddled with ego, drama, politics, blame, turf and a large dose of CYA (cover your arse). Although bureaucracies are the most rational means for carrying out imperious control over human beings, left unfettered, bureaucracies create a work environment where tremendous human emotion is channeled toward internal energy-draining survival activities as opposed to toward external facing services.

Control environments have the ability to completely emasculate public service motivation.

This background needs to be understood by our elected officials that want change to happen, but are stumped as to where to start. Change cannot start from within, from someone who grew up in the bureaucracy, as that is all they know. Perpetuating the status quo is in their best interest, especially if they are nearing retirement, and culture will always suffer.

This is the unfortunate reality for some of our cities, government departments and institutions these days. And that is why I am writing about it. The system needs a leadership and cultural overhaul – and we have a generational window to start making it happen.

More to come …

High-Performance Healthcare

You could hear a pin drop. You could feel the goosebumps in the room. Twelve hundred people in Hall D sat in wonderment as the mysteries of healthcare began to be unveiled.

Darren Entwistle, CEO of TELUS, and the 30th recipient of the Alberta School of Business Canadian Business Leader Award, brought to life a vision that blended public and private, technology and humanity, research and delivery, data analytics and mother’s intuition.

I will never forget that speech. Enlightening. Compelling. So Promising.

As an Edmontonian, I felt the momentum. Capital Health was the pride of the city and the gold standard across the country. Our advances in medical research filled the headlines. New products and new companies attracted capital. And we were attracting the best and the brightest on a weekly basis.

Edmonton was the center for health care excellence in Canada …
… and our entrepreneurial spirit needs to rise once again.

Building on our strengths and capitalizing on our resolve to be the leader for the country, it is time for Edmonton to advance the conversation about high-performance health and health care.

High-performance means doing what others believe to be impossible. It’s a mindset that needs to permeate everything we do, every day. It is a mindset that will bring about criticism. It is a mindset that will be challenged publicly and we will be ostracized by our peers … because it is a mindset that will create progress and excellence … the very things that are the enemy of the status quo.

But that is what leadership is all about.

And at a time when we have a new Premier, a new Health Minister, a new CEO of AHS, a new President of the University of Alberta … we need a new ambition and new intention … and the entire community will rally with you to make Alberta the very best.

As spoken once by Mr. Entwistle … Boldly Go.

Governance in the Public Service

I’m feeling disheartened and concerned tonight.

Over the past decade, we have pushed and voted for accountability, transparency and good governance.  We’ve embraced the Neil McCrank Report on Boards, Agencies and Commissions, and legislated a Governance Secretariat.   We have moved to a world of Results-Based Budgeting and have graduated numerous elected officials and public servants with ICD.D (Institute of Corporate Directors) designations.

So much progress and ambition … to build a better Alberta.

Yet tonight, I have learned that the Alberta Health Services (AHS) Board stood by their conviction that certain bonuses were deserved by public officials, and now risk termination because they defied the demands of the Minister of Health.  The Minister stated that “We cannot and will not accept AHS’s decision.  It is completely out of steps with the times” and “we will ensure … they live within their means.”

This is where I’m challenged.

I watch the unplanned budget cuts to the health and education system like the rest of you.  I struggle reading Cam Tait’s articles on PDD.  I have friends whose jobs have been eliminated.  And I’m starting to feel this isn’t my Alberta anymore.

But … we put these Boards, Agencies and Commissions in place to steward these complex organizations on behalf of government.  We do so to de-politicize the decision making, and to increase accountability to us, the taxpayers.  We appoint good people, citizens of Alberta, to do five main things: (1) Hire the CEO and hold him/her accountable for performance; (2) Shape the strategic plan that delivers on the expectation of the Shareholder; (3) Approve the business plan and operating budget; (4) Assess and ensure organizational risks are adequately managed; and (5) Ensure the policies are in place to prevent risk, fraud or mismanagement.

By in large, these boards do a great job – AIMCo, ATB, AFSC, AGLC, AITF, ERCB, UofA, UofC and all the other acronyms.  So when the Minister … any Minister … decides to undermine these Boards and declare that they will make the decisions on budgets, programs or staffing, the whole concept of governance gets thrown out the window.  When such occurs, there is no longer a role for an independent Board, and the organization is nothing more than a department of the Ministry.

And I’m not just being hard on the government in power.

When the leader of the opposition states that “The Minister has to assert his authority and he has two ways to do it … he can issue a clear directive telling the Board to rescind the bonuses, or he has to fire the Board” she is equally as wrong, as both these options are also blatant political interferences.

Recent assault on Boards, Agencies and Commissions comes (1) When the government is not clear on their expectations for performance prior to budget approval; (2) When they use the budget as the tool to imply policy; or (3) When they change the rules mid-course.  Whatever the case, if Alberta is going to mature into a beacon of good governance, then we need to shift the blame away from Director education … and toward clearly articulated Shareholder expectation.