Jim Krapf Reviews Michael Barzelay's Breaking Through Bureaucracy
Barzelay believes that the ideas which still dominate public management practice are found in the politics-administration dichotomy. He also insists that even though theorists have relegated this bureaucratic dichotomy to the dustbin of history, it remains alive and well in administration. The politics-administration dichotomy is the idea that policy-making and policy are separate activities and are assigned to separate groups of public officials.
Barzelay suggests, in his book, that the main problem with the bureaucratic paradigm is democratic accountability. The bureaucratic paradigm features the ideas of authority, responsibility, efficiency and control. Barzelay sets forth an alternative to the bureaucratic paradigm. He calls this theory, the post-bureaucratic paradigm. The post-bureaucratic paradigm has concepts of customers, service, quality, value, flexibility, innovation, empowerment and continuous improvement.
The focus of Barzelay's book examines problems which arise between line agency employees, who directly produce the government agencies outputs, and the staff agency employees, who control inputs. His book is centered on the struggle of the Minnesota state government's efforts to break through the bureaucracy and political restraints which make it hard for line agencies to meet citizen valued outcomes.
In the early 1980, staff agencies of the state of Minnesota, with the support of overseers, operating-level managers and employees broke through the politics-administration dichotomy by, identifying their customers, clarifying accountability, relationships, redesigning their operating strategies, introducing choice and competition in internal service relationships and changed their management style to focus on results rather than inputs.Part One: Setting the Agenda
Setting the agenda includes two chapters. Contained in chapter one, Beyond the Bureaucratic Paradigm, is a short narrative of the history and description of the Bureaucratic Paradigm. According to Barzelay, "five beliefs are found within the paradigm. Belief 1. Delegation of authority, defines each role of executive branch. Officials act only when permitted to do so by rule or superior's instruction. Belief 2. Officials should uniformly apply rules and procedures and penalties are enforced for disobeying rules. Belief 3. Experts in budgeting, accounting, purchasing, personnel are assigned to centralized staff. Line agencies include engineers, law enforcement and social service providers. Belief 4. Finance responsibilities include preparing the budget and preventing overspending. Purchasing is responsible for enforcement of purchasing rules and minimizing prices paid for goods and services. Personnel responsibilities include classifying jobs, examination of applicants and making position appointments. Belief 5. Honest and efficient operation of the executive branch while central staff controls line agency administration action (Barzelay, 1992. P.5)"
Chapter one continues with some criticisms of the bureaucratic paradigm and identifies Barzelay's challenge that government organizations should be customer-driven and service oriented. He indicates that public managers of today should use these concepts to solve operational problems by transforming their organizations into user-friendly, responsive and competitive organizations providing service to customers. Barzelay also indicated that analysis of private customer-driven organizations will help managers and public officials to define, review alternatives and solve problems.
Barzelay compares the bureaucratic paradigm and the post-bureaucratic paradigms as they apply to agencies. "Bureaucratic Agencies Customer-Driven Agencies Focus on agency needs and perspectives. Focus on customer needs. Focus on roles & responsibilities of its parts. Focus on organization team. Defined by amount of resources it controls. Defined by results achieved for customers. Controls costs. Creates value net of cost. Sticks to routine. Modifies operation in response to changing service demands. Insists on following procedure. Builds choice into operation. Fights for turf. Competes for business. Announces policies and procedures. Two-way communication with customers to assess and revise Operation strategy. Separates thinking from doing. Empowers employees to make judgments on how to improve customer service and value. (Barzelay, 1992. PP. 8-9)"
Barzelay's book draws contrast of the Bureaucratic and the Post-Bureaucratic paradigms on two levels of generality. "The general level compared how government production should be managed, how control should be exercised and what employees should care about(Barzelay, 1992. P.9)". "On the second level, the two paradigms compare relations of central staff agencies, line agencies and overseers and how the relationship should be managed(Barzelay, 1992. PP. 9-10)". Overseers give authority to staff agencies to control inputs to line agency production. Staff agencies receive their authority from laws and regulations. Staff agencies usually show lack of response to line agency requests. Without change in the process, staff agencies act as a bottleneck for use of the post-bureaucratic paradigm. This is what took place during the 1983-1990 period in Minnesota state government ,as well as, resistance to change by the employees.
Chapter two, The Need for Innovative Strategies, further explains were the Minnesota state government saw bottlenecks in the system and also gives insights into how they overcame the Bureaucratic Paradigm. Some examples of the bottlenecks faced by the state follow: - Normandale Community College in the early 1980s decided to offer personal computer training to students of their business classes. Normandale planned and promoted a computer class in their college catalogue. In January, nine months prior to the beginning of the classes, Normandale asked Central Supply to purchase fifty computers for the class. Two weeks prior to the class, the computers had not arrived. Normandale contacted the director of Administration, who handled purchasing, and asked why the computers had not arrived. The Director of Administration asked his procurement director why action had not been taken on the computer request. The procurement director explained that the state was going to order several hundred computers and the price would be better if they bid them together. So the requisition order from Normandale had not been filled. Under the procedure of the purchasing system nothing could be done to order the computer. Normandale had no choice but to cancel the class. - the Commerce Department of the State of Minnesota decided to change their manual typewriters to electric typewriters. They researched typewriters and decided that IBM Selectrics should be ordered. They submitted their request to Central Purchasing. The buyer wrote general specifications, which regulations allowed, thus the Commerce Dept. received not IBM Selectrics but another brand as purchasing contracted with the low bidder. In six months, problems began, the typewriters needed frequent repairs, replacement ribbons were hard to find and many typists refused to accept the machines even if it meant that the typist continued to use their old manual machines. Office supervisors recommended that the purchased electric typewriters be shelved and the IBM Selectrics be leased. -the budget execution process among state agencies in Minnesota required that all appropriations be spent with no thought of economizing. The state measured their success according to the increase they requested for more appropriations. If any money remained in the budget at the end of the year, the agency's appropriations for the following year were reduced. Agencies that did economize on costs were rewarded by reduced appropriations in future years.
Many more examples of the general inefficiency of the state government were exhibited by Barzelay. Governor Rudy Perpich in 1983, issued an executive order which place a general freeze on hiring, purchasing equipment, travel by state employees and technical contracts. The freeze order was Perpich's response to shortages and also appeased the critics who believe that government is wasteful. The freeze created a battle between staff agencies, who developed guidelines and rules to enforce the freeze and line agencies, who began looking for loopholes and writing requests for appropriations as exceptions to the freeze. Thousands of exceptions to the freeze continued to come from line agencies, hence staff agencies wrote more guidelines and rules .This is another example of the resistance to change which filtered throughout state employees.
PART TWO: Breakthroughs are Possible. Chapter three is called Inventing Strategies. This chapter introduced the strategies which would begin the task of changing the state government to a customer service enterprise. A waste and mismanagement commission existed within state government but was highly inefficient. In 1985, Governor Perpich cochaired the STEP program, with Dayton Hudson Corporation, William Anders. The STEP (Striving Toward Excellence in Performance) program reviewed proposed projects from state employees. The first year thirty-six projects were approved by the STEP commission. "Governor Perpich mandated to the Commissioner of Administration, Sandra Hale a challenge to make the state of Minnesota the best managed state in the nation(Barzelay, 1992. P.39)". Hale began meeting with business executives throughout the state. Most business executives felt that government and business were so different that meeting would not help solve government problems. The Chairman of the Dayton Hudson Corporation, William Anders felt that his organization and state government were similar, they both employed large numbers of employees whom dealt with the public. As a result, Anders agreed to Cochair the STEP program. "The steering committee for STEP worked on four principles, 1) improvement of quality and cost-effectiveness rather than cutting expenditures; 2) making change from within by state employees rather than outsiders; 3) broad range of contributor within committee and 4) suggested that cost savings went back into programs and services (Barzelay, 1992. PP. 39-40)"
Administration officials encouraged state employees to propose projects to improve state services through improvement of operations. The Administration felt that this would help give state employees ownership to the changes which needed to be made. Perpich then scheduled agency relations meeting to encourage two-way communication. Line agencies were encouraged to seek out competition for repair services, which had been internal. The changes continued, the Personnel Agency was asked to place the best people in the open positions, rather than following the long process of rules and regulations. Purchasing agents were asked to identify line agencies as their customers and provide them with quality product in a timely fashion. The Information Management Bureau changed, the service and control aspects of the Bureau were separated which helped meet the needs for high-quality, cost-effective service. In general, all state entities were asked to change their operations, views of their fit in the government, and their rules and procedures
Chapter four addresses reworking the culture and producing results. The Staffing Department, found within the Department of Employee Relations began redesigning their work. Agency service teams were a result of the new organizational structure and identified a change from performing technical functions to providing a unified service to the customer. The operating-level employees were empowered to respond to customer problems. This doctrine addressed the concepts of problem solving and customer service. The employees were instructed to use their judgment rather than following the technical decisions based strictly on rules and regulations..
The Purchasing Division of the state government also made changes. Buying agents were empowered to make decisions and solve problems. The Administration executives also authorized purchasing decisions based on life-cycle costs rather than low bid. Purchasing also was given more flexibility. Line agencies could purchase items costing less than $1,500 and also, allowing the flexibility to award contracts to vendors. Empowering buyers helped with the decrease in delivery time of purchased items.
The Information Policy Office also restructured their operation. The IPO identified their customers as the governor and the legislature. "The IPO performed three critical tasks to meet customer needs, 1) making information policy; 2) complying to the norms; and 3)helping overseers to use the budget to improve efficiency, effectiveness and accountability (Barzelay, 1992. P.68)."
The Administration's management of marketplace enterprises used common business practices to succeed. Business practices such as market research, competitive analysis, executive plan reviews, cost analysis, service delivery redesignment, product promotion and financial reporting were all used to analyze.
Chapter five: Challenging Financial Paradigms The Finance Department clung to the bureaucratic paradigm. They were convinced that their job was providing staff support during the budget process, that they controlled the execution of the budget and they were the state's financial agent. Governor Perpich appointed a new finance commissioner in his final year of office. The new commissioner looked for ways to make line agencies more accountable for serving customers, managing their resources and complying with norms. In 1990, the commissioner decided to bring the new vision of state government to the finance department. The first issue was the capital budget. The tendency of state agencies was to ask for more bonding authority for capital projects than could be approved. One reason for this was that agencies were not charged for debt service on bonds for their capital projects. The new strategy was to have the agencies prioritize their capital projects and that the agencies were required to fund the cost of debt service out of their budgets. The legislature did not agree with this policy and final negotiations required the agencies to pay one-third of the debt service from their budget; the remaining two-thirds would still be paid by finance.
The commissioners second priority was the biennial budget. Past history required each agency to justify increases in spending and staffing and defend them to finance and the legislature. The supporters of the new vision, including the commissioner, wanted overseers and managers to focus on results rather than inputs. The commissioner asked that agencies not increase their budgets over the base. He also asked that agencies manage better to make up for the increases they normally asked for. Governor Perpich agreed and included the commissioners recommendations in the budget instructions. The agencies did not favor the governor's position. As a result, Perpich was defeated for reelection. The new governor-elect, to the surprise of the agencies, adopted the budget instructions as his own.
PART THREE: GENRALIZATIONS
Part three of Barlelay's book is the how to guide. It includes Principles for managing customer-focused staff agencies. Barzelay lists six principles for managing staff agencies, they follow: "1. Spread responsibility for economizing and compliance. 2. Conceptualize work as providing services. 3. Identify customers with care. 4. Be accountable to customers. 5. Reorganize to Separate service from control. 6. Let the customer fund the providers." (Barzelay, 1992. PP. 102-114)
The first principle, responsibility for economizing should not be given to staff agencies alone, but should be the responsibility of all government work units including the line agencies. Compliance in the bureaucratic paradigm was the responsibility of the staff agencies alone. Staff agencies, according to Barzelay do not possess the same input on line agencies that the line agencies would have . It is hard for staff agencies to make judgments without the same information that the line agency would possess. Thus, compliance should also be the responsibility of all government work units.
The second principle, conceptualizing work as providing services, is explained by two reasons. First, the outcomes of conceptualized work become meaningful, workers can understand work as producing outcomes, then they can examine how the outcomes may be improved. Second, mutually agreed up adjustments become valued. Employees can realize that they and the users in the co-production of the service and they can work to increase working relationships with the public.
The third principle, identify customers with care, is based in the Minnesota experience. Taxpayers in this case were not identified as customers at this level. Customers of the staff agencies were identified as line agencies. In the government operation, the agencies as customers must be realized before the taxpayers as customers can be realized.
The fourth principle: be accountable to customers, explores the relationships between the provider and the customer. The objective is to reach a working relationship in order to meet the customer's needs. Employees of the agencies need to possess, who the customer is and how the customer should be served.
The fifth principle, reorganize to separate from control, addresses an organizational structure problem, human action in a control system and human action in a value system differ. This causes confusion among employees and will affect the purpose of their work. No work group should be designed to serve both line agencies and overseers as customers.
The final principle, let the customers fund the providers, addresses the power of the customer to hold service organization accountable for meeting the customers needs. If there is an exchange of money, the customer will force the organization to produce the required outcome.
Chapter eight: The post-bureaucratic paradigm in historical perspective. Barzelay in the final chapter details the shift in paradigms. His discussion compares the bureaucratic and the post-bureaucratic: public interest shifts to results citizen values; efficiency shifts to quality and value; administration shifts to production; control shifts to adhering to norms; function, authority and structure shift to mission services, customers and outcomes; justifying costs shifts to delivering value; enforcing responsibilities shifts to building accountability and working relationships; following rules and procedures shifts to understanding and applying norms, identifying and solving problems and continuous improvement processes; operating administrative systems shifts to separate service controls, building support for norms, expanding customer choice, encouraging collective action, providing incentives, measuring and analyzing results and gathering feedback.
In conclusion, Barzelay's post-bureaucratic paradigm, with emphasis on customer-driven service orientation is another step into the future of organizations. The move away from the bureaucratic paradigm will progress slowly, there will be organizations, in the public sector, that may never achieve customer service status. Small town America may provide barricades to changes in operations and have been entrenched in the bureaucracy for many generations of public government.