This gallery contains 16 photos.
Category Archives: Business
The main prescription of New Public Management (hereafter NPM)—that public administration should be operated similarly to a business—is the brunt of much criticism, while at the same time gaining many faithful adherents. Liberals such as Inwood (2004: 321, 389, 408, 410-1, 414) view NPM as little more than facile economism, and pine for a return to Keynesian policies. Nevertheless, such curt dismissal ought to be the cause of some suspicion: it may well be, after all, that Liberalism proceeds from such radically different premises than NPM that the former must necessarily oversimplify the latter in order to say anything about it at all. This, as will be shown below, is indeed the case. Through an examination of the policy area of human resource management, it will be argued that NPM policy possesses a sophisticated theory of subjectivity (as manifested in its capacity to deal with matters of knowledge management) which may prove flexible enough to supersede controversial issues such as affirmative action.
The most common view of the role NPM in human resource management is to identify redundant staff members and work practices which can be cut without damaging performance capacity. Yet, a strong reply to this is that the structure of bureaucracy may be more intricate than appears at first sight, relying on uncodified (and perhaps uncodifiable) practices—known as tacit knowledge—in order to implement whatever policy is important at a given time. According to a quantitative study of knowledge management in the workplace (Wah 1999b, quoted in Smith, 312), “99% of the work people do is knowledge-based” and furthermore, “90% of the knowledge in any organization is embedded and synthesized in people’s heads” (Wah 1999b, Bonner 2000a, Lee 2000; quoted in Smith, 311). This presents significant problems when it comes to measuring workplace performance, since firing any particular worker risks altering the tacit workplace dynamic. As well, the key role of tacit knowledge in the workplace presents a trade-off between unhindered intra-organizational ‘flow’ of knowledge and the ‘democratic’ introduction of special interest groups into the decision-making process (Wiig, 228). Such problems, insofar as they are uncodifiable, present seemingly insurmountable problems, pointing toward persistent expansion of bureaucracy for fear of endangering the system, contrary to the prescriptions of NPM.
When viewed in terms of C. Northcote Parkinson’s theory of public administration, however, the prescriptions of NPM may be seen to be quite sensible. He takes as a premise his eponymous ‘Law’ that “Work expands so as to fill the time available for its completion” (Parkinson: 2). This is due to two “almost axiomatic” motive forces: “(1) ‘An official wants to multiply subordinates, not rivals’ and (2) ‘Officials make work for each other’” (ibid, 4). As he makes clear in subsequent chapters, this law may be generalized such that instead of ‘time’ only, it applies to resources of any sort. This is often viewed as facetious, but can be interpreted in an entirely serious light: in fact, in addition to Parkinson’s own data (ibid, 7-12) taken from military records, Klimek, Hanel, & Turner’s quantitative study (2009) of the formulae derived by Parkinson from his eponymous Law concludes that they “hold empirically to remarkable levels of significance” (3939). Parkinson’s conceptual innovation is to take the quality of work as a constant, while leaving as variables the amount of resources available for the work’s completion and the degree of the work’s ostensible complexity. This assumption is legitimate in the case of public administration, since much of the work (e.g. paperwork) can only be done so well; in the terminology of economics, the marginal productivity of effort spent on a project drops to (or, at least, toward) zero at a certain fixed point. Following Laruelle (2000), it can be said that NPM views the matter of budgets as a “unilateral duality”—defined as any scenario where from the perspective of x, both x and y exist, but from the perspective of y, only y exists. To illustrate, Laruelle’s main inspiration here is Marx, whose base-superstructure model posits that in the last instance, all elements of society are determined by the relations of production (cf. Inwood, 29-30). So according to NPM’s Parkinsonian logic, all the incidental details comprising the completion of a project are effectively epiphenomenal, since they are determined-in-the-last-instance by the budget.
Moreover, Parkinson’s Law possesses an interesting sophistication in that it posits an asymmetrical distribution of possible amounts of resources to assign for a given project: while there is an obvious limit in terms of parsimony, there is no limit when it comes to abundance—thus accounting for stereotypical bureaucratic wastefulness. What the concept of unilateral duality contributes to our understanding of budgets is this: since allocating more resources to a project than are strictly needed causes the knowledge networks related to the project grow more and more complex, this redundancy can be deliberately managed in order to create intellectual capital for use in future projects related to the present one (cf. Wiig, 232; Taleb, 72-3). This idea may be expressed rather clearly in the distinction made by Clausewitz (1906, bk II, ch. 1)—which should obviously be taken figuratively—where “tactics is the theory of the use of military forces in combat” and “[s]trategy is the theory of the use of combats for the object of the war.” Rather than budgets progressively increasing, according to the Parkinsonian view budgets should be steadily decreasing as the ‘learning-by-doing’ allowed by each project increases administrators’ productivity. By use of Parkinsonian logic, then, NPM is capable of overcoming cynical views of bureaucracy as wasteful—instead, by means of ‘strategy’, NPM is able to reflexively redirect the inflationary tendencies of bureaucracy toward productive ends. IBM consultants, for instance, were able to encode their personal heuristics for proposal writing into a database, which subsequently “cut proposal-writing time from an average of 200 hours to 30 hours” (McCune, 1999; quoted in Smith, 312-3). So, in much the same way that Taleb (2012) recommends that institutions be set up in such a way that they gain from volatility, from Parkinson’s Law may be gathered a prescription of purposively making use of redundancy.
It is now possible to return with a critical eye to the arguments about knowledge management raised above. Although Parkinson’s Law precludes any arguments about ‘ruining’ the tacit knowledge dynamic of the workplace, there is still the problem of the trade-off between ‘democratic’ participation and uninterrupted flow of information. To address this problem, the subtopic of affirmative action will be discussed initially, and its conclusions applied to remaining subtopics. As Inwood (295) notes, the education requirements for administrators are becoming increasingly stringent, to the point where schools intended specifically for training management workers have been opened. As Schmidt (2000) argues, the main purpose of professional education of this type is twofold: to instill standardized knowledge and practices for practical use in the workplace, and to impart specific modes of thinking and dealing with problems. Qualification criteria are expressed in standardized tests, and grades are thus viewed as positively correlated with merit. Since affirmative action policies relax the grade requirements for minority applicants, there is resistance to affirmative action on the grounds of a trade-off between inclusion of minorities and overall benefit to society. Looking at the matter in terms of tacit knowledge, however, Schmidt argues that this dichotomy is a false one. The problem is simply that qualification criteria have limits: “a professional is more than someone with technical knowledge” (Schmidt, 108). In many cases, Schmidt observes that there are many instances in which professionals draw upon tacit knowledge related to their socioeconomic background in order to relate to clients, make causal inferences to diagnose problems, and to make ethically informed choices; he uses the example (ibid, 108-9) of a doctor who realizes that a patient’s illness is psychosomatic, that is, brought about by his or her work conditions, and is motivated to take steps to try to bring about change—as opposed to ‘mechanistic’ and palliative treatment of an isolated body part. Schmidt’s conclusion is that despite Wilsonian objections as to the objectivity of public administrators, the decisions made by professionals of all types are inherently political.
So the prescriptive conclusion that we should draw from the above points in conjunction is as follows. Considering that “[n]early two-thirds of work-related information that is gradually transformed into tacit knowledge comes from face-to-face contacts, like casual conversations, stories, mentoring, internships and apprenticeships” (Smith 314-5), efforts should be made to facilitate interdepartmental communication in an attempt to transmit tacit knowledge among departments. One workable idea is provided by Smith (317), who describes the online ‘social tactical system’ developed by Xerox:
Technicians write up ‘war stories’ to teach each other how to diagnose and fix machines. Service reps access over 5,000 tips a month for a 5 percent saving on both parts and labor. Field service reps create and maintain the tacit knowledge base by contributing and renewing all the tips and information and maintaining the system. Each time reps contribute a tip, their name goes on the system.
Given that flexible boundaries for budgets, according to Parkinson’s Law, only serve to motivate unnecessary complexity, these are to be avoided. In short, in order to run the government more like a business, finances must be tightly controlled from the top down. Affirmative action is to be encouraged (though not necessarily to excess) among departments, though this need not extend to executive positions, whose qualifications typically depend on traditional standards of competence more than do other administrative positions (cf. Inwood, 281). Such policies as described above are quite similar to those which currently obtain under NPM (cf. Inwood, 70-1), or are at least within the horizon of its potentiality. Future examinations of the Parkinsonian model of NPM in less parsimonious, and perhaps more quantitative, terms may prove fruitful, though this is beyond the scope of the present essay.
- Clausewitz, C.; Graham, J.J. (trans.). (1909). On War. London : N. Trübner.
- Inwood, G. (2004). Understanding Canadian Public Administration, 2nd Ed. Toronto: Prentice Hall.
- Klimek, P.; Hanel, R.; Thurner, S. (2009). To how many politicians should government be left? Physica A: Statistical Mechanics and its Applications 388(18), 3939-3947
- Laruelle, F.; Adkins, T. (trans.). (2000). Introduction au non-marxism, ch. 3. PUF: Paris, pp. 39-55. Retrieved from speculativeheresy.wordpress.com/2008/07/20/chapter-3-of-laruelles-introduction-to-non-marxism-determination-in-the-last-instance-dli
- Parkinson, C.N. (1957). Parkinson’s Law, and other studies in administration. Boston: Houghton Mifflin.
- Smith, E. (2001), The role of tacit and explicit knowledge in the workplace. Journal of Knowledge Management 5(4), 311-21.
- Schmidt, J. (2000). Disciplined Minds. Lapham, MD: Rowman & Littlefield.
- Taleb, N. (2012). Antifragile: Things that Gain from Disorder. New York: Random House.
- Wiig, K. (2002). Knowledge management in public administration. Journal of Knowledge Management 6(3), 224-39.
Not long ago I was watching videos in the ‘Shift Happens’ series, and unfortunately came across a troll video with entirely made up statistics (even though it was very professional looking). Given my proclivity for rationalizing anything unfortunate that happens to me, I soon had the epiphany that in a way, made up statistics tell more than actual statistics. By identifying the limits of plausibility, made up statistics reveal the extent of what is possible (good or bad) about the subject in question, be it a society, business, or demographic.
For instance, I could inform a firm’s board of directors that 67% of its employees confuse the words ‘loose’ and ‘lose’ in company emails, and if they reject that statistic outright then we know how high is the expected education calibre of the employees; if, on the other hand, they entertain its possibility, then we know that there is a problem. Made up statistics allow us to quantify the margins of error inherent in managers’ conceptions of their company—an eminently subjective frontier, but one that is, in a way, far more important than the actual performance data of a company. In the tradition of economic graphs, this allows us to compare the actual productivity of a company with the counterfactual horizons of its potentiality, and ask—in a much more objective way than before—what a business can do to make itself better.
Some provisos: first, this method can be applied to any portion of the social sphere, but not to the natural sciences. Second, its practical application opens up the (somewhat amusing) possibility of ‘modal terrorism’ on the part of managers: “The probability that you’ll slack off is higher than the probability that X will slack off! Shape up or ship out!” With some misgivings, one could sympathize with the purpose of such a policy, but it could easily degenerate into what might be called the ‘Caesar’s Wife problem’. The book How To Build a Better Vocabulary (p. 220) explains the origin of the phrase “like Caesar’s wife” as follows:
The phrase is especially applied to public officials whose conduct must be free not only from actual misdeed but from any suspicion of wrongdoing. Plutarch tells us how the expression arose. A young nobleman Publius Clodius was accused of a religious crime in which Pompeia, the wife of Caesar, was implicated. Caesar divorced Pompeia, “but being summoned as a witness against Clodius, said he had nothing to charge him with. This looking like a paradox, the accuser asked him why he parted with his wife. Caesar replied, ‘I wish my wife to be not so much as suspected.’”
The very idea that such a policy may be implemented on a large scale should strike the reader as being quite silly, but fittingly, the fact that we can imagine it at all tells us something important about capitalism that may have otherwise gone unnoticed.
[This is yet another presentation that I made a couple of years ago for my sociology class; I had found a textbook on gerontology at a used bookstore and wanted an excuse to read it. It has become unfashionable to mention the aging baby boomers, but the fact remains that the elderly are becoming an increasingly important element in North America, and we will likely see our political, economic, and cultural systems adjusting to this demographic shift. (See here for an idea of the impending changes.) Hence, I present to you a general description of the biological, psychological, and economic aspects of gerontology. For the accompanying slideshow presentation on the topic, the interested reader is directed here.]
Though the video itself is quite silly, it helps to give an idea of the system of values in which Wall Street bankers operate. I post this here as a plea for protesters not to attribute the origins of financial crises to concrete, humanistic causes (namely, the greed of bankers) alone, but to emphasize that the main problems are abstract & systemic ones. The video underscores (sacrilegious as it may sound to devoted Leftists) the fact that most Wall Street bankers are not exempt from the askesis displayed by those providing their testimonials here.
These bankers are caught in a wicked paradox where they can have all the wealth they could want, on the condition that they cannot enjoy it. It is not uncommon for investment bankers on Wall Street to work 70+ hours a week (mostly on Excel or Powerpoint), nor is it uncommon for them to turn to ‘uppers’ (including cocaine) to boost their stamina in order to get through their work week, which may include multiple all-nighters. Their bodies deteriorate from lack of exercise just as their minds stagnate from having no other stimulation besides basic mathematics, as well as from their lack of sleep; it is no wonder, then, that in their 3 hours of free time per week, investment bankers turn to alcohol, prostitutes, and superfluous purchases of luxury goods to make themselves feel as if they have some standing in the world. They have their basic needs taken care of, yes, but only on condition that they give up everything else, just as with the rest of the 99%.
A classic problem in economics is how to maximize utility despite limited resources, such as time and money. The Lagrangian method uses a technique from calculus to mathematically measure how consumers can achieve maximum satisfaction and businesses can maximize profit (or minimize costs) within given limits. (Source)
The person in the video isn’t me, by the way. I’m just so overjoyed to find an accessible introduction to the Lagrange method that I am sharing it with the world.
I just found an excellent video on CBC News. Apparently, “the world prepares to welcome its seventh billion inhabitant sometime this year.” Its eighth billionth is projected to appear in 2025, but world population is expected to settle at 9-10 billion by 2100. As well, India is projected to become the most populous country by 2050. All the more incentive for people to read my Prezi presentation on India. My full 40-page report is available upon request.
Oh, and by the same institution (Agence France-Presse): Malthus, anyone? No, to invoke Malthus is to be overly pessimistic; I think that hydroponic growth sounds quite promising, especially if we can manage to do such farming in multiple floors of skyscrapers, which would provide a more efficient use of space than our clumsy acre system, and the lack of wasted resources would allow the world’s poor to be fed with little to no extra water & nutrients used (which is especially pertinent given the looming water crisis). The main problem is accumulating the requisite energy cheaply enough to make these projects profitable…
In 1988, The Newfoundland government (Canada) donated $13 million of taxpayers’ money to build a “space-age greenhouse” which would hydoponically grow cucumbers which would sprout to full size within six days. Unfortunately, because of the market being flooded with cucumbers, the company, Enviroponics, had to sell their cucumbers at $0.55 wholesale, while each cucumber costed them $1.10 each. According to a survey near that time, the average Newfoundlander ate only half a cucumber a year, and Enviroponics could not export their cucumbers at a profit, so surplus cucumbers flooded Newfoundland’s market, and its dumps (reminiscent of the semi-recent European milk crisis, except less morally ambiguous and more inept; point your mouse at the links for explanation). In 1989 Enviroponics went bankrupt, selling its facility to another company for $1. A total of about 800,000 cucumbers were produced, and the cost to taxpayers per cucumber was $27.50, compared to 50 cents for cucumbers produced out of province and sold in Newfoundland grocery stores. This “boondoggle” (i.e. fiasco) has since become a symbol of foolish government spending. (Source)
Just a little history lesson. Nevertheless, it’s been 20 years, no? Surely hydroponic science has progressed a bit further since then. At any rate, however, the world is in no state to revolutionize farming methods anytime soon. Still, hopefully the above has suggested that the modernist dream of ‘mapping’ every variable of the world is still going strong, despite the postmodernists‘ clamor. But then, social science is still in its infancy compared to the mass progress of the natural sciences (as Imre Lakatos asserts, with whom I more or less agree), yet it’s precisely this latter field that will most likely give representatives of the modernist project a run for their money (hopefully in the literal as well as the figurative sense).