The No Tool Zone

My counterparts in the UK have run into the same American problem.  Short-sighted thinkers that blindly go for extremes.  Be they Democrats that believe that all work should be done by the government or Republicans that believe everything should be outsourced . . .  no one is asking the right questions.

John Seddon outlines the problems with government outsourcing of services that a Conservative (Sir Peter Gershon) advocates in an article titled, Economy is in flow, not scale.  Gershon’s suggestion is that all the public sector back offices should be outsourced within 18 months. 

As Mr. Seddon smartly points out, the focus starts with two failing premises reduce costs (this focus always increases them) and a central plan is more communist than capitalist.  The very thing hell-bent Republicans are trying not to be . . . they are becoming.  More centralization to save money (reduce costs)  is blazing a path to ruin.

So what are the right questions?  Well in Gershon’s case maybe we don’t even need a back office.  Just to outsource or privatize the back office to reduce costs does not guarantee that the design of front office-back office is even needed.  Much of the waste is in the design of the work, so why perpetuate a bad design by outsourcing a function?

Then where do we begin?  Quite simply with understanding constituent demand and purpose.  Designing public and private sector systems based on demand means that the work gets redesigned to allow the flow to run smoothly.  In turn, well designed work  and smooth flow reduces costs.

Unfortunately, this is not what I see from Republicans that are doing more Soviet-style central planning.  They focus on scale and not flow.  More is not better, did the fall of the Soviet Union not convince them of this?

The scary part is that the cost reduction thinking I have seen in states like Indiana has done nothing but increase costs.  Poor theory leads to higher costs.  Indiana’s answer has been to sell State assets to make more revenue (which is really taxes) to over come expensive provisioning of services.

A colossal waste of money in moves to consolidate (or share) government services.  They fail to see the real costs of provisioning services.  Unfortunately, until thinking changes we have little chance of reducing government deficits.

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Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public).  His organization helps executives find a better way to make the work work.  Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at info@newsystemsthinking.com.  For government please link to www.thesystemsthinkingreview.com.  Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.