More organizational agility and less business bureaucracy in times of pandemic

The bureaucracy will begin to crumble when the best professionals, connected and committed to the organization leave the playing field of power.

Gary Hamel – Humanocracy

I write this article with a double purpose: First, I want to raise awareness about the need to end bureaucracy as a management model, since in times of pandemic bureaucracy can lead our organizations to a dead end. Secondly, I would like to stress the desirability of the Redarchy as an engine of the necessary changes in our organizations when looking for an innovative solution to the problem of excessive bureaucracy in our ways of working.

Organizational agility and agile organizational culture

Over the past two decades, I have had the opportunity to participate in dozens of Innovation projects in significant companies in our country and I have been able to talk to hundreds of managers about the challenge of building the organizations of the future, not as bureaucratic machines where people are mere resources, but as real Innovation ecosystems where people find meaning and purpose in what they do. What I’ve observed in most of the organizations I’ve worked with is that the bureaucracy and the corporate immune system that defends it is the biggest brake on any attempt to organizational agilism, where organizations are more flexible, agile and able to respond quickly to a challenge as disruptive as the Covid-19 pandemic.

The cost of bureaucracy

Reality shows us every day that bureaucracy has a very high cost in terms of values, transparency, initiative, creativity and commitment. And it is that from its fundamental logic – as a power machine – it tends to clientelism by rewarding loyalty, while overvaluing the legacy and previous experiences at the expense of innovation and adaptability to new challenges.

Bureaucracies by design are inertial and slow in decision-making. They are incremental in innovation, as bureaucracy has little room for the curiosity, intuition, and daring that animates human creativity. And its cost is particularly high in terms of commitment, as command and control create organizations that are predictable but unable to react to a pandemic.

A relevant example of the costs of bureaucracy in times of pandemic is the complaint made by the professors of the UCM, José M. Bautista and Jesús Pérez Gil, about the administrative wall that they have found to carry out an initiative to monitor infections in the Complutense. In his own words, “In this pandemic, perhaps more than ever, the obsolescence of an archaic system of control of public goods is evident more than ever. Distrust is rule number one. Slow procedures are rule number two. The fear of appearing responsible for allowing wrongdoing is rule number three.”

In my own experience, arguably the biggest cost of bureaucracy is that it chains people to a job, limiting their contribution framework with rules and structures that prevent them from developing their full potential for the organization, so in a way it imprisons human capacity in a prison of rules and procedures, many of which have more to do with command and control and hinder, As is the case in this pandemic, many of the disease control initiatives could arise by bringing into play available resources in different public and private health institutions. In these cases the cost of bureaucracy, as we hear every day in the news, are human lives. And, if there’s one lesson that leaders, public and private, have learned these past few months, it’s that the virus moves faster than our bureaucracy.

Why is it so difficult to eradicate bureaucracy?

First of all, bureaucracy is the operating management system of virtually all organizations large and small. So it is considered necessary and inevitable. Second, as Gary Hamel, one of the world’s most influential business thinkers, points out in his latest book Humanocracy, co-written with Michele Zanini, many managers have a vested interest in perpetuating the status quo. Bureaucracy is a massively zero-sum multiplayer game, either you get promoted or a rival gets promoted. If you are an advanced player, know how to deflect blame, defend territory, manage, accumulate resources, exchange favors and negotiate objectives well, it stands to reason that you are not enthusiastic about changing it. Thirdly, while there is currently consensus on the need to combat bureaucracy, there is no consensus on how best to do so.

Any approach to tearing down bureaucracy programmatically, with a big top-down corporate initiative will fail. In Hamel’s words “Dismantling bureaucracy is less like tearing down an old building and erecting a new one in its place, and more like doing a restoration from scratch with enough care so that the building never collapses on you.” And this is so, because the bureaucracy is concerned with actively and continuously maintaining the health of the company. Incrementalism and standardization have been proven to work and have helped organizations grow. If the activities of the bureaucracy are being threatened, the first reaction of the corporate immune system is to resist the changes. As a result, our organizations are less adaptable, creative and inspiring than the people in them. And they keep getting worse.

Some believe that bureaucracy is inevitable. But they are wrong, we all know innovative companies such as Amazon, Apple, Google, Netflix, Airbnb, Uber or SpaceX of enormous scale and complexity that have mostly managed to produce extraordinary results by eliminating bureaucracy and establishing a Agile organizational culture. So if you’re wondering how much bureaucracy could be eliminated without sacrificing organizational performance? The answer is more than you think.

Less bureaucracy, more netarchy.

If we are stuck, it is not because we lack role models. Ten years ago I introduced the concept Netarchy as a new emerging organizational structure in the new networked organizations. And while it’s true that chain-of-command hierarchies are the natural order in most companies, and that hierarchical structure is still necessary for an organization to function. It is no less true that the pandemic has taught us that new ways of working, collaboratively and networked, are possible.

Netarchy allows us to achieve the control, coordination and coherence we need to respond to the pandemic without sacrificing people’s creativity, or consuming much of the human labor in paper bureaucracy. And what is very important, it is a bold way to build the organization of the future brick by brick. Netarchy principles allow us to put people, not structures or processes, at the center of our organizations. Instead of a management model that seeks to maximize control for the sake of efficiency, Netarchy seeks to maximize people’s contribution, making it possible for them to find meaning and purpose in their work.

But make no mistake, it is impossible to dismantle bureaucracy without redistributing authority. Personal power is the fuel that fuels the growth of bureaucracy. We have to face the reality that in times of pandemic we cannot afford, economically or ethically, organizations that allocate power without leadership capacity, discourage risk-taking, politicize decision-making, and create long and tortuous control rules, which undermine the responsibility of frontline health professionals to respond quickly and efficiently to the enormous challenges of the disease.

A matter of principle

In bureaucracy, rules prevail and we fall in love with processes and tools, so to reduce it we need to change our approach, going from seeing people as mere resources to generate income, products or services, to seeing people at their full potential. Every human being is entitled to the opportunity to grow and fully utilize their own gifts, and it is from this perspective that we must begin.

For that to happen, we have to start with a new set of principles in management. We need to inject new DNA into the cultural genome of our organizations. What we have learned during these years, helping many organizations reduce bureaucracy and build organizations that inspire people to give their best, can be summarized in these ten key principles:

The first principle is purpose. In most organizations the reality of their values does not live up to their rhetoric. We say one thing and do another. Most organizations claim that people are their most important asset, but the truth is that the fundamental concern of the bureaucracy is to maximize control, something unacceptable if what we want is to mobilize human energy.

The second principle is innovation. We must be radical in reinventing the bureaucratic management model. We have to build Agile organizations Focused on people who are adaptable, creative and where people find meaning and purpose in what they do. It is necessary to imagine new structures, and new management models radically different from the bureaucratic template.

The third principle is organizational agility. We must anticipate and take advantage of changes before we are overtaken by the new reality. This is achieved by establishing a Innovative agile organizational culture. It is necessary to transfer resources, organizational talent, and management focus from the past to the future while maintaining operational results. We must turn the pandemic into an opportunity to reinvent our health system.

The fourth principle is experimentation. In the new normal, experimentation is the new planning. Strategy is not something that is planned, but emerges as a result of experimentation and the search for new, more efficient ways of working connected, collaborating and learning. We have to make it possible for the culture of exploration and execution to live in harmony under the same roof.

The fifth principle is autonomy. We need to create organisations where innovators can thrive. The problem of innovation is not creativity, lack of ideas or talent, the problem is not facilitating that innovators have the autonomy and adequate resources to test and validate their ideas.

The sixth principle is trust. In bureaucracies, lack of trust demoralizes and fear paralyzes. Adaptability, innovation and commitment require a work environment where information is shared, diversities of opinions can be expressed freely, courageous questions are asked and risk-taking behaviors are promoted. This concept is successfully worked through “Acelera Liderazgo“,
our training program in adaptive leadership and team management
The seventh principle is collaboration. Collaboration is key to overcoming bureaucracy and improving productivity in times of pandemic. It is through collaboration that we can put into practice new forms of networking, breaking down vertical silos and new ways of remotely caring for patients. Sharing always creates value and makes the whole more than the parts.

The eighth principle is community. The sense of community implies belonging and is the basis of people’s commitment. We all long to be part of a genuine community, and the emotional strength and resilience that comes from being known and accepted for who we are. When we feel safe and accepted, we give our best.

The ninth principle is fault tolerance. To overcome bureaucracy, it is important to have creative but persistent people who fight to make things happen despite internal resistance. We must look at failures as opportunities to learn. Keep iterating until we discover new models of care delivery that put patients at the center of the health system.

The tenth and final principle is netarchy. Unlike bureaucracies in the netarchy, you don’t need a position on the organizational chart to innovate. Each health professional feels the owner of the institution and enjoys autonomy to make decisions with the necessary urgency. All connected, collaborating and learning together based on transparency and trust.

Companies and institutions that have overcome bureaucracy have learned to reconcile conflicting goals, such as scale and agility, innovation and efficiency, and freedom and discipline. Overcoming bureaucracy means trusting people and giving frontline team members the information and skills needed to make smart, real-time decisions as the situation requires.

In times of pandemic we cannot accept that bureaucracies and the management systems that support them can only be improved by a few at the top of the pyramid. The problem is that waiting for bureaucrats to dismantle bureaucracy is like waiting for politicians to put the country ahead of the party, or for your five-year-old son to make the bed. If we want to dismantle bureaucracy and build truly people-centered organizations, we must all do our part and actively commit to these principles and incorporate them into our organization’s management systems and processes.