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Thinking like a Bureaucrat at GM

Throughout the entire 11-year history (of the problem), there was no demonstrated sense of urgency, right to the very end.  

GM’s CEO Mary Barra on a faulty ignition switch that cost at least 13 customers their lives.  In response, she fired the 15 employees responsible for allowing this defect to persist.

I have to give her credit for this, she accepted more responsibility and took more action with this problem than all of Wall Street did after 2008 disaster.  Clearly, there aren’t many adults on Wall Street.

What went wrong?  

Fifteen or more people made bad decisions, year after year, for eleven years.  They:

  • Did not fix the problem.
  • Did not report information related to the problem that might have resulted in a fix.
  • Used bureaucratic processes to avoid taking responsibility for the problem.

Why did these employees make bad decisions?

These employees were bureaucrats.  They made decisions like bureaucrats.  This means they were trained to:

  • See their job as separate and different from who they are as people.
  • To avoid make decisions on their own.  To use the corporations rules and regulations as the basis for all decisions.
  • To view the needs of the bureaucracy as more important than the needs of customers and other outsiders.

 

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Discussion — 3 Responses

  • cheap NFL wholesale jerseys July 4, 2014 on 1:36 pm

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  • Clark Landwehr July 8, 2014 on 6:07 pm

    But bureaucracy was one of the greatest inventions of civilization. Having bureaucratic institutions that don’t care about you is actually a good thing. That is why in the west we don’t have to pay a bribe to get a driver’s license. We are so spoiled in the US. Of course there are big drawbacks to bureaucracy, but that is true of everything mankind has ever built or created. A world without impersonal bureaucratic institutions would be much WORSE than the one we live in.

    Reply
    • John Robb Clark Landwehr July 11, 2014 on 1:37 pm

      Three things:

      Some bureaucracy is a good thing. Too much is a bad thing. Too much of even a good thing can be very, very bad for you.

      There is lots of bribery in US governance (although the scale is much larger and it’s harder to detect). For example: we see it in the revolving door at the DoD, SEC, FCC, and many other agencies.

      Further, in contrast to other cultures, we Americans aren’t too good at running a large bureaucracy (particularly one that manages large portions of our economy).

      Reply