A Passion for Leadership (2 page)

But it's not just politics that is the problem. Elective bodies with oversight responsibilities also are unreliable, unpredictable, and even irresponsible when it comes to the lifeblood of public institutions—funding. How can any organization do long-range planning when it never knows from one year to the next how much money will be available or, in the case of federal agencies, when the money will actually be approved and can be spent? Not once when I was secretary of defense did Congress approve our Defense appropriations before the beginning of the fiscal year in which the money was supposed to be spent. In a couple of instances, we didn't know how much funding would be available until midway through the year, and once (and several times since I retired) Congress never did approve our annual appropriation. And when you toss in mindless acts of congressional misgovernance—such as shutdowns, furloughs, and sequestration—and micromanagement masquerading as oversight, just keeping the doors open is a challenge. Even on the state level, funding levels from one legislative session to the next are usually crapshoots.

To draw a vivid contrast between leadership in business and that in government, imagine a company with a board of 535 directors, each of whom has as his or her principal objective personal self-interest and political self-preservation as opposed to a responsibility to the institution he or she oversees. Further, unlike a corporate board, Congress draws no distinction between strategic direction—providing big-picture guidance on operations and long-range priorities—and trying to manage the day-to-day affairs of the institution despite its proven incompetence to do so. Leaders in business by law are supposed to focus narrowly on what is in the best interest of the company and its shareholders. In the public sector, broader considerations—especially political—come into play in ways that make reform or change more difficult.

Another unpredictable factor in the oversight of institutions—mainly public ones but a lot of businesses as well—is the uneven quality of the individuals elected or appointed to fulfill the role. Members of Congress, state legislators, and (especially for business) regulators, for example, vary dramatically in expertise, diligence, understanding, and just plain smarts. Too often, it is the members who fall short in one or more of those categories who create the most problems, block reforms and appointments, oppose constructive change, and try to impose unworkable or costly policies, rules, or programs. In universities, too many individuals elected or appointed to oversight boards (regents, for example) know virtually nothing about higher education in general or the issues facing a given institution. The quality and qualifications of individual regents vary widely, from micromanaging, ill-informed, arrogant, self-serving cronies of a governor to independent, thoughtful, and open-minded appointees who add value and work hard (and selflessly) to make an institution better. Similarly, to a much lesser degree but in still too many businesses, one can find a wide range of quality in leaders, both in the boardroom and in the executive suite. Such wide variation in the quality of those charged with oversight is well-known to every public servant at every level of government—and to employees in more than a few companies. This, too, is an obstacle to bureaucratic reform and change.

Another big problem is that, at least at the most senior levels, many bosses in public institutions (again, at all levels of government) lack managerial or leadership experience. Even when the appointments process is working well in terms of focusing on qualifications rather than political loyalty or persuasion, too often senior government positions are filled with people—academics, lawyers, financiers, consultants, contributors, members of legislatures or their staffs—who may have reputations for expertise in a particular function or field but who haven't got a clue about how to run anything. Moreover, many appointees hope or expect to be in the position for a relatively short time, and a significant number see the public sector executive job as a stepping-stone to something more exalted. As a short-term steward, a boss who is a political appointee too often thinks short term and primarily in terms of how his personal performance will be perceived externally—including by the person who appointed him. Thus, he avoids controversial moves, fails to prioritize, and underinvests, especially in areas that only matter in the longer term. In short, most political appointees measure success by a yardstick other than effective management or successful institutional reform. Indeed, too many of these folks view change and reform as bad risk-reward trade-offs because such steps can create internal as well as external opposition and often bad press.

When a businessperson appointed to lead a government department falls on her face, it's often because nothing in her corporate experience has prepared her for the complexities of running an organization with the “help” of the president or governor, Congress or state legislature—much less a raft of lower-ranking political appointees in her organization whose loyalty as often as not is primarily to the political operatives and politicians who got them their jobs and not their day-to-day boss.

Another reality would-be reformers face in the public sector is that almost every career employee has some form of job security. While most think of tenure as lifetime job security for university faculty, in truth, except in dire budgetary circumstances, the uniformed military and civil servants have significant job protection as well. While firing people has become more difficult in the private sector, it is still relatively easy (especially if incompetence, mistakes, or misbehavior have been documented) compared with the public sector. Unlike in business, those opposed to an agenda for change or reform cannot easily be fired or even moved out of the way to another job. As a result, most civil servants who are opposed to change or reform can simply outwait the reformer. They were there when he arrived; they will still be there when he leaves.

In contrast, there is usually no job security at or near the top of public bureaucracies. In the executive branch of the federal government, about the only senior officials who have a term of office specified in law are the president, the vice president, and the director of the FBI (ten years). Every cabinet officer and all political appointees serve “during the pleasure of the President of the United States for the time being,” as their commissions read. That is not exactly reassuring or conducive to pursuing risky and difficult change. There is significant turnover among such officials, and anyone coming in with a mandate to make changes has no idea how much time he or she may have to do so. The average tenure of an assistant secretary in a cabinet department is about twenty-one months, and it takes most people six to twelve months to get their feet wet. Officials' uncertainty about how long they will be in office is yet another impediment to reform and change.

In my very limited experience with unions in the public sector, at the federal level, they were not a particular obstacle to change. Most of the sclerosis that impedes change in terms of hiring, firing, work rules, pay, and personnel is generally hardwired into law or regulations. Union activity or leverage is usually aimed at legislators, not within the bureaucratic institution itself. This was certainly the case at the Department of Defense, where part of the civilian workforce is unionized. The unions there were an obstacle to only one change I wanted to make—an attempt to alter the pay structure and, in particular, to provide incentive pay for civilians. The unions did play a part in killing that reform, but it was through powerful allies in Congress rather than through direct action internally. Their influence is, I imagine, more pronounced at the local level. Still, I believe that when it comes to reforming the
way
business is done and the
organizational structures
for doing so—in contrast to pay and benefits—with the right approach, unions can be partners, not obstacles.

If you think removing
people
in a government bureaucracy is difficult, just try eliminating an agency or office once created. Talk about nine lives! In the Pentagon, if you stamp out an organization one day, it will likely spring up in another form and under another name—sort of like crabgrass—somewhere else. Senior Defense officials have eliminated organizations to reduce costs, only to discover later that no one lost his or her job—people just got shuffled elsewhere. It's the old “find the pea under the walnut” scam, and the boss is the sucker. I was the yokel more than once.

Business also does not have to take seriously the influence of retirees or alumni as do a number of public institutions, including virtually every university and college, the military, and at least some civilian organizations (for example, charities and foundations, police and fire departments). I found it ironic that students or employees who bellyached constantly about the shortcomings of an organization while they were still there, upon graduation or retirement decided the place was, in fact, nearly perfect. And thus they opposed any change as undermining the foundations, culture, and traditions of the organization. Perhaps an exception to this is in the uniformed military, where, upon retirement, some senior officers suddenly become much smarter and strong advocates for change, coming up with ideas for reform that somehow eluded them while they were in positions of responsibility and had the authority to make those changes themselves (or at least push for them). At the same time, most military retirees continue to advocate for their own service (army, navy, marines, air force) and for programs near and dear to them and their service. Pro-reform or against, military or civil servant, spy or student, the voices of the departed demand to be heard by the leaders of many public institutions—and are.

Bureaucratic reform, ironically, must also overcome the growing demand for transparency in decision making. Imagine corporate executives having to devise strategy, internal restructuring, personnel policies, and marketing plans entirely in public. Or a chief executive officer of a company meeting with his or her board of directors on future strategy in a town hall. What is unthinkable in the business world is everyday practice in the public sector. Granted, some businesses—especially very large ones in politically sensitive arenas such as finance and banking, aerospace and defense, communications and social media, the Internet, pharmaceuticals—are subject to intense public scrutiny and their own form of congressional or other oversight. But the number subjected to unrelenting public attention and exposure is relatively small compared with the entire universe of companies.

However, for the would-be reformer in a public institution, plans for change are publicly aired by leaks, regulation, or state law—no matter how preliminary or immature—making her a rich, inviting target for advocates of the status quo. While the reformer is still developing a battle plan, opponents of change have ample time to deploy their forces and counterattack. Public scrutiny is constant, and the willingness of subordinates to create bold or controversial plans for change is undermined by the likelihood those plans and the identity of the author will be leaked, publicized, and meanly criticized. In states where legislation mandates open meetings, like Texas, almost nothing can be kept confidential. As an example, a university president there cannot meet privately with the board of regents to discuss strategic plans or direction; a gathering of more than three regents is considered a public meeting and must be announced in advance and opened to the public. While the CIA and the Defense Department operate under very different rules of confidentiality, the reality is that a culture of pervasive leaking of information in Washington, D.C., has nearly the same effect as open records and meetings laws. Without draconian measures by the CIA director, defense secretary, or other senior officials, any and all plans for institutional or budgetary reform soon find their way to Congress and the media. The reform leader of any public institution—even in the areas of intelligence and defense—must assume that everything she does or says will quickly be in the public domain, making the development and execution of reforms difficult in the extreme.

The culture of public bureaucracies and all too many private sector organizations is also a serious obstacle to change and reform. Fundamental to bureaucratic culture is risk avoidance: It is almost always safer for the public bureaucrat—and too often the business bureaucrat as well—to say no than yes. In a public environment of exposés, recrimination, faultfinding, and investigations both by officials and by the media, not acting is usually safer than acting—especially if the action involves something new or different. Common sense, and sometimes even doing the humane thing for someone, are set to one side out of fear of incurring a cautious supervisor's displeasure or being disciplined—or even fired—for not going “by the book.”

This problem has been mightily aggravated by the more intrusive role of new forms of media that provide detailed coverage of what used to be minutiae below the threshold of major media interest. Blogs now specialize in widely distributing what was once office gossip and watercooler talk about officials under pressure or programs facing challenges, often even before senior management is aware or has had a chance to act. All this affects behavior and makes everyone more cautious. Further, the proliferation of investigative bodies, inspectors general, quasi-independent evaluation entities within traditional bureaucracies, together with the steadily growing propensity among politicians over the years to look for someone to hang for every single problem or hiccup, has contributed not just to risk aversion but to inaction. This is replicated to one degree or another at every level of government. Fear of making a mistake and being placed in the public dock keeps already cautious bureaucrats—and their political appointee overseers—looking over their shoulders.

Also fundamental to bureaucratic culture both in business and in the public sector is the “not invented here” defense mechanism. Almost any idea for improvement or reform or just doing something more efficiently that originates outside the affected organization automatically generates antibodies of opposition to repel the invading idea, especially if it comes from a known critic. Even more personally, a supervisor all too often rejects his own employees' ideas for improvement simply because they were not his ideas. Further, it is in the nature of bureaucracy for the boss at each level to want more people and more resources: each often measures her personal success not by customer satisfaction but by the size of her “empire.” The idea of willfully shrinking one's empire to make the overall enterprise more successful and more efficient borders on heresy. And there is no financial incentive, personally or institutionally, to do so in a public bureaucracy.