Going Postal–Management Style

Commenter LWA asks.

Can’t manage their way out of a paper bag? Support, please.

Fair to ask. Although I think Dave had a point in that he had in fact provided support for his position, I’d like to add a bit more. Not that it will persuade the firmly persuaded, but there might be folks out there on the fence unsure of what to think. And wherever they ultimately land, a good conclusion requires evidence. (Others are, of course, free and welcome to provide counter-evidence.)

1. Comparison to Learning Organizations
Let’s start with a snippet I found at Business Insider.

Author and social entrepreneur Geoff Smart shared an interesting little anecdote in his new book “Leadocracy: Hiring More Great Leaders (Like You) into Government.”

When Smart was a graduate student, he had to observe two different leaders for a class project. He went to a Walmart and Post Office and compared the two.

The first was a manager at a Post Office, and what Smart saw was a management catastrophe.

He writes:

“I noticed that the boss slouched in his chair with his shoulders slumped forward, and talked with a frown on his face. He pointed his finger at the other people in his meeting. The discussion he led was all about rules and compliance — the concerns of bureaucracy — for almost the entire meeting, combined with some unpleasant nagging of the workers. He talked down to them and insulted them.

“The boss and the workers complained about customers and how much of a nuisance they were. There was no discussion of problems to be solved, results to be delivered, or accomplishments recently achieved. No mention of analyzing, allocating, or aligning people to achieve great results.”

OK, let’s note up front that this is obviously anecdotal. He observed a grand total of one USPS manager, so far as we are told. And I’ve had bosses in the private sector who stabbed fingers, and talked down to and insulted employees. And I’ve seen good, thoughtful, engaged leaders sit with slumped shoulders and a frown on their face–it can be a sign that they’re thinking deeply about how to solve a problem.

The more meaningful issue is what they talked about at the meeting. If your meeting is all about rule-compliance and complaints about your customers, and not about identifying and solving problems or identifying results, that’s a problem.

That type of meeting is a temptation in all sectors. I see it frequently in academia. In fact I was witness to it just this past Monday, until one of my colleagues emphasized that we needed to stop complaining about a problem and try to identify some solutions. As is par for the course in my case, that person was a business professor.

It happens in business, too. I’ve been there. But businesses can’t afford to indulge in that, because the longer they gripe instead of making a clear identification of the problem, devising a proposed solution, and setting some benchmarks so they can identify success or failure at correcting the problem, the longer they continue to burn money.

Bureaucracies can afford to do that, because they don’t have to worry about the bottom line. That doesn’t mean they don’t have budget constraints, but the civil service staff cannot lose their jobs over the bottom line, and the appointed officials rarely do. In the bureaucratic world, failure to achieve the desired results with the available funds more often translates into requests for increased funding than substantive reconsideration of how they operating.

So what did Smart see at Wal Mart?

Walmart, in the private sector, was the total opposite, even though its low-level jobs are as infamous as any other retail chain in the world. There, he saw what was basically a pep rally. They talked about goals and results from the previous week. They talked about analytics and rewarded an individual who had set a record. “They looked like they were having fun,” writes Smart.

Damned if I’d want to work for Wal Mart. But I’ve seen this myself in the private sector. The pursuit of profit is often treated as a dehumanizing activity, something that turns everyone into soulless uncaring people. But let’s contrast that with the pursuit of rule-compliance. Folks here at this blog have talked about businesses that have taken that route: “Joe, you took 16 minutes for your break today. You only get 15 minutes, so I’m going to have to write you up.” It is more common in agencies, because they are generally better able to bear the costs of doing so.

Another way of putting this is that businesses tend to be what organizational theory folks call learning organizations. Organizational “learning” is defined by Richard Downie (director of the Center for Hemispheric Defense Studies at the National Defense University in Washington, DC.) as:

a process by which an organization uses new knowledge or understanding gained from experience or study to adjust institutional norms, doctrine, and procedures in ways designed to minimize previous gaps in performance and maximize future succes. (p. 22 in Learning from Conflict).

Businesses that that don’t learn fail, leaving those that learn. Among bureaucracies, only one type is very frequently a learning organization–the military, which was the subject of Downie’s research. Militaries pay a big cost when they don’t learn. But even they–generally the best of public agencies at becoming learning organizations–don’t always manage it, according to Lt. Colonel John Nagel, in Learning to Eat Soup with a Knife: Counterinsurgency Lessons from Malaya and Vietnam.

Military organizations often demonstrate remarkable resistance to doctrinal change as a result of their organizational cultures. Organizational learning, when it does occur, tends to happen only in the wake of a particularly unpleasant or unproductive event. (p.8)

This is a fundamental difference between the private and public sectors–the incentive to learn from experience and to make effective changes. Now what does this have to do, specifically, with the USPS? Simply, there is no reason to expect it to be a learning organization. It is counter-intuitive and atheoretical.

This doesn’t mean the USPS has no good managers. It means there is little systematic incentive structure that rewards good managers for their insights into how to improve performance, or disposes of bad managers who have no such insights.

Keep in mind, for good reasons we want it that way. The civil service system was created to limit political mucking about with the bureaucratic agencies–we limit that to the upper level staff who are still politically appointed (Michael Brown, Donald Rusmsfeld, etc.). A spoils-system post-office might very well find it more convenient to deliver the mail more quickly to Democratic-leaning neighborhoods than Republican-leaning ones, or vice versa depending on who’s in power and appointing the local postmasters. I think the civil service system is better than the spoils system, as I think many others here do, but the value of that upside that does not mean the cost of the civil service system isn’t both real and significant.

Nor am I suggesting there are no bad managers in business, or that all of them are successfully disposed of. But there is a systematic incentive structure designed to limit the bad ones and promote the good ones, and if that frequently fails, we certainly should expect better when there is much less of an incentive structure.

In short, everything we actually know about bureaucracy in general leads to a prediction that the USPS is likely to have bad management, and the anecdotes Smart describes are precisely what we would expect to find. Finding a different outcome would not be impossible, by any means, but well-grounded theory tells us to expect that would be the unusual case.**

2. EEOC Complaints
This is some old data, but in the 2002 fiscal year, the USPS reportedly had “the largest number of EEO complaints filed of all Federal agencies,” a total of “9,931 complaints filed, or about 45% of all complaints filed” against federal agencies. (Unfortunately, the link to the original EEOC report is dead.)

The USPS has improved, at least in raw numbers. The 2009 report shows 5,659 complaints, and in 2012 the number fell to 4532 (and almost 1900 of those were closed with the conclusion that there was no discrimination). But those 4532 complaints were out of a federal total of 15,837 complaints filed against the federal government. That is, as of two years ago, the USPS still accounted for 28% of all discrimination complaints filed against the federal government. Granted 28% is an improvement on an alleged 45%, but it’s still not very good.

Counting only executive branch non-military personnel, the federal government employs 2,697,000 people. The USPS employs 692,000, or 24%. But EEOC requirements apply to the military as well, and when you add in the 1.5 million military personnel, the USPS is only 15% of federal executive branch employees.

We can ask Tod for an expert’s insight on the quality of management at an organization that gets that many EEOC complaints.

3. OIG Criticism
The USPS Office of the Inspector General (OIG) just last month released a report criticizing the USPS on its office closure and relocation plans.

The process for relocating facilities was not always transparent. Further, the vice president, Facilities, has conflicting responsibilities for approving funding and adjudicating relocation appeals. We reviewed 33 of the 114 relocation projects we identified for fiscal years 2011 through 2013, and found 25 new site selections were not announced until after the public comment and appeal periods ended, and two had undetermined announcement dates. We found that only one of the 25 appeals filed for the 114 projects was upheld, leading management to halt the relocation. Further, the Postal Service could not readily identify the number of relocations and officials did not always efficiently manage the public notification and
documentation process.

These conditions occurred because some procedures were
unclear and the vice president, Facilities, was authorized to approve funding and adjudicate appeals. Further, there were no requirements to track all relocations and officials did not always know the specific guidelines and processes.

I found criticisms from Heritage, Cato, and the other sources you’d expect. I didn’t even bother to click those links. This is the USPS’s own Inspector General’s office, not some right-wing or libertarian thinktank. This is an official and non-partisan critique of bad management.

Conclusion
This is already a long post, so I’ll knock off there. But there is some theory as to why we would predict poor management to be likely, and two clear examples demonstrating management problems.

Is it total, dispositive, unchallengeable proof? Of course not. But watch closely to see if my critics come up with documented evidence, or respond only with abstractions and red herrings.

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*Not to suggest that any particular commenter has criticized all those agencies, but I think it likely that each commenter has criticized one or more of them.

**Remember I talked in the other page about agencies with a clear sense of mission. That sense of mission, which is an intrinsic part of organizational culture, can compensate to some extent for the lack of effective incentives. Maybe the USPS has such a mission-focused culture, but I haven’t seen any indication of it. An agency whose main business is declining in volume and expected to be declining, and is casting about for other tasks to help revitalize it does not strike me as an agency that has “agreement about and widespread (if not enthusiastic) endorsement of the way the critical task was defined” (Wilson, Bureaucracy_.