Five Dysfunctions of the “Government Team” As Well
October 6th, 2009 . by economistmomI’m hearing a lot of fascinating perspectives here at the World Business Forum. Filmmaker George Lucas is speaking now, but I admit I’m not much of a Star Wars fan, so I wanted to make contact with my EconomistMom readers and tell you about my favorite speaker today: business consultant Patrick Lencioni who gave a talk on “Building Winning Teams.” Pat is the author of the book “The Five Dysfunctions of a Team”–focused on what makes businesses fail when the members of the “team” fail to adequately relate to each other. At times Pat sounded like a knowing marriage and family therapist, but at other times I was thinking he needs to take these lessons not just to businesses but to President Obama and members of Congress.
Pat’s five “dysfunctions” of a team are:
- Absence of trust.
- Fear of conflict.
- Lack of commitment.
- Avoidance of accountability.
- Inattention to results.
More on what these mean and how I see them as highly applicable to our federal government “team” as well (especially in the government team’s business of fiscal policymaking), later.
Very compelling talk by economist Jeffrey Sachs, and another inspiring one by businessman Bill George, today, too. Will summarize later as well.
Thank you for attending these meetings so we don’t have to!
Having been on (and led) numerous cross-functional, intradepartmental and parent-subsidiary teams, I would say that conflicting agendas/objectives (often due to related conflicting incentives), on a group and/or individual level, should be somewhere on that list of factors in team dysfunction. Seems like something that applies to government development of fiscal policy as well.
Typical cross-functional example: Manufacturing managers rewarded in part based on keeping inventories low (to keep inventory carrying cost low), and Sales managers wanting to keep inventories higher to ensure product availability. I remember (from my product management days) monthly battles in forecasting meetings between Sales, pushing an inflated forecast, and Manufacturing doing the opposite, neither apparently in full good faith.
Another very common example: Sales (rewarded based on revenues, not profit) wanting as much advertising and other promotional spending as possible, and more discounting than Marketing/Product Management if the latter has P&L responsibility and is responsible for bottom line results.
Example of parent-subsidiary: Back in 1990, in one of America’s most admired companies, I developed a growth strategy for the wholly-owned Mexican subsidiary. The International Marketing Department of the parent company (for which I was working) set the transfer price to maximize that department’s profits (not for legal or tax reasons) even though that left the subsidiary barely profitable and unable to make investments that could grow the business and maximize overall system (parent + subsidiary) profit and other financial metrics. The reason: The managers of the department were rewarded based on the department’s profit resulting from sales to the subsidiary.
And of course, even on teams within departments there are groups (e.g., different brand teams) and individuals competing for resources and pushing strategic choices conducive to their more narrow objectives even when supposedly putting their heads together to maximize overall department performance.
And outside agencies often have objectives that conflict with the team objective of optimizing performance. I recall an ad agency executive passionately presenting some obviously bogus argument against devoting less of the marketing budget to advertising (on which they made most of their money) and more to another form of promotion.
etc., etc., etc. I’m sure many of the above dynamics have their parallels in the fiscal policy development and enactment process.
Brooks,
At least in business incentive compensation can be balanced between corporate-level goals and unit / individual goals to help steer collective decision making towards the “common good” of all stakeholders of the company.
Our elected members of Congress seem to be almost exclusively driven by individual goal incentives with only lip service to the overall common good and goals of the country. I don’t get the sense that voters by and large judge candidates on what they will do for the country as a whole but rather what can they do for my state or my district.
The role of the President doesn’t seem to have much effect on this dynamic either through ineffective leadership or his/her own focus on the special interest groups he/she depends upon for approval and/or re-election.
It is clear to me that our government has lost the ability to focus primarily on the common good when facing one or more big problems (if they ever have?) rather than primarily focused on their special interest constituents. (The recent medicare premium vote in the House is a good example.)
The only conclusion I see as a result is that we won’t adequately address our big problems, they will get worse, most people in the country will suffer as a result, and perhaps then there will be a primary focus on the common good of the country as a whole. The risk is that we’ll fray apart as a society in the process. Why our government leaders are willing to take that risk is beyond me.
Personally, longer-term alteast and watching how this all plays out, I am looking for an acceptable plan B if there is one–maybe Australia, maybe New Zealand, maybe Brazil, maybe Costa Rica? I love our Country and I’m expressing my concerns to my Congressman but the path our federal leaders have been taking us down (Republicans and Democrats) indicate they aren’t able to adequately address our big problems so I have no choice but to consider the alternatives for my family.
Gilleland,
I, too, have a generally cynical view (which of course I consider realistic) of the decision criteria and behavior of members of Congress, and to perhaps a lesser extent, the president (not specific to the current Congress or to Obama). We do have a “tragedy of the commons” dynamic, but even more on constituent segment level and the individual politician level than on the district/state level. Basically, I think the greatest factor by far in decisions and behavior of members of Congress is personal political calculus — re-election and rise in power and status, which leads to pandering in general and to various segments, as well as doing favors for special interests that can provide big campaign money, and thus the tragedy of the commons.
Some changes that would help are:
- Clean government reform. Mostly public funding of campaigns (voluntary, to avoid First Amendment issues, but made so attractive via matching multiple and flexible spending limit that there is little/no advantage to anyone from opting out).The Fair Elections Now Act would move us in the right direction http://www.publicampaign.org/node/38166 Also more restrictions on the revolving door.
- Budget process changes to provide political cover for fiscal responsibility. Strong, statutory, comprehensive PAYGO, getting entitlements off auto-pilot, SAFE Commission, etc.
- Public education (such as the Concord Coalition-led Fiscal Wake-Up Tour and other commendable activities, but in more ways by more entities and individuals and on a larger scale) that raises the political cost of fiscal irresponsibility, largely by making “responsibility” a more important (or at least as important) badge for people to wear than “conservative” or “progressive” (insofar as the latter obstructs compromise solutions and leaves us only with posturing and stubborn, unrealistic insistence on politically infeasible “solutions” to our long-term fiscal imbalance).