The Senior Bureaucrats’ State of Mind

The Senior Bureaucrats’ State of Mind

At the top position in every company’s functional pyramid is a group of senior bureaucrats held responsible for the profitable execution of that company’s current business plan.  The major problem with these positions is that on an increasingly shorter term, the profitability definition has changed so that historic standards are no longer meaningful.  Depending upon your industry’s current position of equity and capital, you are either trying to drive your company’s cash flow to pay off heavy debts, or improve your margins to be competitive in the highly competitive and world adjusted capital markets.  These financial pressures cause the senior manager to become very focused on whichever strategy might best meet these demands.  Because of corporate takeovers, mergers, leveraged buyouts, or changing competition, a corporate strategy or financial demands can change rapidly with very little notice, requiring quick responses to complicated questions of performance standards and overall corporate culture.  It would be enough of a problem to have to react in this environment alone.  I believe that the successful bureaucrats of the past — those who tended to end up at the top of these structures — are ill-prepared to perform successfully in an environment of rapid change and poor employee morale.

The nature of these types is a strong desire to control the activities and circumstances around them.  They tend to be very competitive and the historic political bureaucracy created a win/lose environment.  Traditional resource allocation in historical political bureaucracy is similar to the concept of a Mexican pi¤ata–but with a perverse twist.  The pi¤ata (or resources) is hung so high that no one participant is able to hit it with his or her stick, and gather the resources.  Since all the participants have sticks, and since the culture rewards individuals instead of communal efforts, it makes more sense for one person to use his or her stick to put someone else down, and to step on top of them to collect the rewards of the game.  This behavior is deeply rooted in the American culture.  The American industrial heroes are generally lone entrepreneurs who broke out of the mold, established a competitive edge, gained a monopoly over the environment, and in many cases used their sticks to ensure victory.

The notions of individual competition, limited resources, and hero worship of entrepreneurial kings are deeply rooted in the American business culture.  These types had the ability to then reward their subordinates with titles, money, and resources, which they dealt out in the same manner in which they had received them.

The warriors who were unwilling to be political either left the organization to become entrepreneurs and, if successful, create their own political order, or they got pushed out for non-compliance to the organization’s standards.

In either case remaining people were able to tolerate each other and manage to capture enough of the market to remain in business.  The fact that the company remained in business helped maintain the bureaucratic structures that had worked for as long as anyone could remember.

Over the last 100 years there have always been demands for business leaders to respond to a changing environment.  The change has just never come this quickly, or with such forcefulness.  The many reasons for these changes and their increased pace are discussed on a daily basis in the newspaper.  But, I believe the two overriding issues are the rapidly increasing world competition, which doesn’t allow the American business culture to exist in a vacuum, and the incredible impact of the American baby boom and all of its demographic and psychographic effects.  In all cases, senior American bureaucrats are stuck in a time warp.  They are asked to understand and guide rapid change while being trained only in traditional political bureaucratic structures of the past.