Procedure Over Performance

Procedure Over Performance

My wife works with families with children with disabilities for a state agency. She and I often have discussions about some of the administrative challenges and frustrations with her job, and some of the creative ways that she and other members of her agency are able to bend the rules to meet the human needs of the job, even though their decisions occasionally step beyond management decisions for standard operating procedures. For my wife and her colleagues below the management level of the agency, helping families and doing what is best for children is the motivation for all of their decisions, however, for the management team within the agency, avoiding errors and blame often seems to be the more important goal.

 

This disconnect between agency functions, mission, and procedures is not unique to my wife’s state agency. It is a challenge that Max Weber wrote about in the late 1800’s and early 1900’s. Somewhere along the line, public agencies and private companies seem to forget their mission. Procedure becomes more important than performance, and services or products suffer.

 

Gerd Gigerenzer offers an explanation for why this happens in his book Risk Savvy. Negative error cultures likely contribute to people becoming more focused on procedure over performance, because following perfect procedure is safe, even if it isn’t always necessary and doesn’t always lead to the best outcomes. A failure to accept risk and errors, and a failure to discuss and learn from errors, leads people to avoid situations where they could be blamed for failure. Gigerenzer writes, “People need to be encouraged to talk about errors and take the responsibility in order to learn and achieve better overall performance.”

 

As companies and government agencies age, their workforce ages. People become comfortable in their role, they don’t want to have to look for a new job, they take out mortgages, have kids, and send them to college. People become more conservative and risk averse as they have more to lose, and that means they are less likely to take risks in their career, because they don’t want to lose their income to support their lifestyles, retirements, or the college plans for their kids. Following procedures, like getting meaningless forms submitted on time and documenting conversations timely, become more important than actually ensuring valuable services or products are provided to constituents and customers. Procedure prospers over performance, and the agency or company as a whole suffers. Positive error cultures, where it is ok to take reasonable risks and acceptable to discuss errors without fear of blame are important for overcoming the stagnation that can arise when procedure becomes more important than the mission of the agency or company.
Healthcare Stagnation

Healthcare Stagnation

We are facing a disastrous healthcare stagnation in the United States. Our hospitals are getting older, Medical providers are aging with too few young providers to replace them, and the quality of care that many of us experience is not getting much better. Despite this, the cost of healthcare has been soaring. Healthcare expenditures, including the costs of our deductibles, co-pays, and what our insurance pays out, has been going up at a rate reliably above inflation.

 

In The Opioid Crisis Wake-Up Call, Dave Chase writes the following about our healthcare stagnation, “Unlike virtually every other item in our economy, where the value proposition improves every year, the norm in health care for decades has been to pay more and get less. Also, unlike nearly every other industry, healthcare hasn’t had a productivity gain in 20 years.”

 

Productivity is how much we produce per unit of time spent on production. A factory that makes 5,000 widgets per hour is more productive than a factory that makes 1,000 widgets per hour. Automation and new technologies have helped factories and offices become more productive, but our healthcare stagnation is evidence that we are not seeing the same gains in healthcare. Technology has improved, but not in areas that seem to produce more healthy patients given the same amount of time and effort from our medical providers. We have some new technologies, but somehow those technologies have not translated into a healthcare system that supports the same number of people with fewer resources.

 

Chase continues, “In other words, for the last two decades, there has been a redistribution tax from the working and middle class and highly efficient industries to the least productive industry in America.” 

 

As your job has become more efficient and more productive, your healthcare costs have risen. Chase equates this healthcare stagnation price increase to a tax. Factories that can work with fewer employees, software engineers, and other employees form highly productive sectors are paying more in healthcare for services that haven’t kept the same pace as the industries of the patients they treat. This is the cost of healthcare stagnation that chase wants to push back against by demanding better systems and structures from healthcare providers, insurance companies, and benefits brokers. Chase believes we can find a way to improve our healthcare system and help people live healthier lives for less cost, if employers are willing to make real investments in their employees healthcare, and are willing to hold their brokers and insurance providers accountable for the value their products provide.

Everything Matches

Tyler Cowen is worried about our matching technology. We have algorithms which tell us what TV shows to watch, which books to read, what wine to drink, and what shoes to wear. We can be matched with romantic partners and music, and very often our matching gives us exactly what we wanted and were hoping for. But, in the eyes of Cowen, all this matching has a dark side. It can make us complacent and can lead to greater segregation between people with different backgrounds, experiences, and interests.

 

In his book The Complacent Class Cowen writes, “Better matching for all its pleasures and virtues, is also in some regards uncomfortably close to the concept of more segregation … Very often we match to what we already like, or what is already like us. Matching brings many new and varied delights into our lives, but in a lot of spheres, the like-to-like effects of matching outweigh the ability of matching to shake us up. That is partly why matching can make us so happy.”

 

We like matching. We like knowing that other people like us already like the restaurant we are going to, or the show that is on tv, or the song that is about to play. We like when things are similar to what we already know. It reduces our cognitive burden and eliminates the stress of picking something and spending money on something we ultimately do not like. We are all risk averse to losing money, and hate the feeling of sunk costs. Matching makes us happy by making decisions more simple and helping us avoid the feeling of loss. It reduces our worries and in many instances, such as auto-playing shows online, we don’t even have to make a decision at all.

 

At the same time, matching technology reduces the chances for us to find something new. Up-and-coming artists with a new take on an old style can have trouble breaking through if the algorithms don’t match them with our tastes. We might miss out on great new content because our matching technology put us in a certain silo. When we reduce opportunities for new experiences, we stagnate, leading to the complacency that Cowen feared as we lose a belief that we could be something better than what we are and currently have.

 

A further downside to the matching technology we use is the potential for extreme segregation. If we really like one sport, then we can be pushed ever further into the specifics of that sport. Our algorithms can provide more and more specific content, advertisements, and connections to that single sport, eliminating things unrelated to the sport from our orbit. As we get further along, we might find that all the people we interact with are also obsessed with our particular team from one particular sport, and we will lose some ability to be with people who are not also living in the same bubble.

 

The sports example is a relatively harmless side of segregation, but it can be worse. Racial, political, and religious segregation are also possible with our matching technology. As we burrow down in our own communities, in real life or online, we may alienate those who do not look, think, and hold the same preferences that we do, leading to situations where we cannot have meaningful interactions with diverse people. This type of segregation is not healthy in a democracy because it makes shared visions and understandings of society and culture impossible across different isolated bubbles.

 

Our matching might make us happy and reduce our cognitive load, but it certainly comes with dangerous downsides. We can embrace the matching technology we have, but we should also be aware of what can happen if we let it make too many decisions in our lives. We should also find ways, times, and spaces where we can get beyond the matching to try something new and experience something beyond our typical bubble.