Bureaucratic management ain’t going anywhere

Bureaucratic management

We’ve had some research in the past that — despite the supposed era of innovation — bureaucracy is actually expanding in most companies, and now we’re going to discuss some additional research that bureaucratic management is too. People from The Management Innovation Exchange polled 7,000+ Harvard Business Review readers about their organizations with regard to bureaucratic management. Some of the big numbers upfront include:

For each completed survey, we calculated an overall BMI score by aggregating responses across seven categories of bureaucratic drag: bloat, friction, insularity, disempowerment, risk aversion, inertia, and politicking. We computed an overall BMI based on scale of 20 to 100, based on answers to the first twenty questions of the survey. On our scale, a score of 60 represents a moderate degree of bureaucratic drag, while anything less than 40 indicates a relative absence of bureaucracy.  Of the responses tallied, 64% reported a BMI of more than 70, while less than 1% had a BMI under 40. Not surprisingly, BMI scores were correlated with organizational size.  The average BMI for companies with more than 5,000 employees was 75.  Of the respondents who reported a BMI of less than 40, three-fourths worked in organizations with fewer than 100 employees. This confirms what most of us have long suspected: large companies suffer from managerial diseconomies of scale.

So 64% of these respondents are working in overly bureaucratic places, especially as the size of the organization rises. Probably not too surprising, right? Indeed. But I think what we often miss about this discussion is the reason behind it.

Debunking the first bureaucratic management myth

It is supposedly an innovative, entrepreneurial time — but in reality it’s not. Companies are becoming increasingly bureaucratic, to the point that many companies are seeing 9-14 levels between the top (C-Suite) and the rank-and-file workers. That’s a lot of bureaucratic management. We think it’s a more innovative time because most business publications write about/use examples from Silicon Valley or Boston or Seattle, and those “tech hubs” are doing more innovative things here and there, sure. Most companies are plodding along the same way they always have, even though they’re telling me “Yea, we’ve got a great digital strategy coming along.”

This is kind of like the 2016 U.S. Presidential election: if you only look at the mainstream, upper-middle-class white people sources, you’d assume HRC in a rout. But America isn’t all Silicon Valley cocktail parties and New York Times readers. There’s a lot of frustration in the middle, and HRC didn’t win. This is the same way with companies. Yes, I realize Facebook and Google are innovative and they get mentioned in every Inc article under the sun. No doubt. But there are companies in Topeka that are not innovative and have tons of bureaucratic management. We don’t write articles about those companies, but they’re much more normative.

Why does bureaucratic management persist?

Because work is largely about these three concepts:

The intersection point of those three concepts is basically one word: “control.” People want control. That’s all bureaucratic management is. “I own this process or a slice of this pie, so I have control.” The control gives you the relevancy and the self-worth. And because you have some small measure of control, there’s no way you’re incompetent, right? All three issues have now been addressed.

Think of the absolute worst manager you’ve ever had. I can almost guarantee you that, regardless of industry, this will be true: if you ever challenged that manager on anything, he/she went nuts.  Bonkers. Maybe threatened to fire you. Right? Probably right. That’s a hallmark of bad managers.

Now think about challenging a good manager. They probably were OK with it! It became a discussion because they view you as a “thought partner.” They create a degree of “psychological safety” within their teams and direct reports. People feel it’s OK to be a naysayer on some stuff.

Bureaucratic management is about asserting control and making people feel relevant. While that has value to the human brain (and maybe the male penis), it’s definitely not good management.

Can we phase it out?

No, because it’s super psychological. When we try new management models, i.e. holacracy, they tend to flame out because they don’t support what the people actually want out of a management approach — which is the ability for control. Plus, a management style needs to make sense to the human brain. “I have a boss and he/she can tell me what to do” makes sense. Circles and “self-management” often don’t.

Hierarchy is a dumb concept in terms of “being more innovative” for 10.2 million reasons, but it works because we (a) get it and (b) mostly feel comforted by knowing who we’re accountable to. But hierarchy is naturally going to lead to bureaucratic management and dozens of levels. That, in turn, is going to stifle innovation. Imagine you see something on Twitter and you want to respond quick. In a “fluid” organization, you can. In an org with tons of bureaucratic management, you need 17 layers of approval for one tweet. By the time you get that approval, no one cares about the tweet anymore. That’s a small example, but there are dozens more I could use.

Final thought/problem here: bureaucratic management is often not based on science, meaning promotions and all that are essentially in a vacuum. In those kinds of places, you need to get close to the power core — because that’s going to get you minted in the process. It becomes a giant game of “Let me impress Tom!” instead of “Let me do quality work.” It’s awkward. Most people don’t like to stay at such companies. But because those companies are more and more normative, employee loyalty is declining.

See how it all works?

What else would you add on bureaucratic management?

Ted Bauer

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