Category Archives: bureaucracy

Prez talks org structure

A beach after an oil spill.
Image via Wikipedia

On the oil spill in the Gulf of Mexico (now the largest in history):

Obama says, “This is a big mess coming to shore,” and even with a perfect organizational structure, “spots are going to be missed.”

A president who discusses organizational structure?  Cool.

By the way, I haven’t had much to say about this or anything else lately.  It’s mostly because of work and a sense that others are doing a fine job with it.  That said, I owe the Minerals Management Service a spanking.  Shame that they’ll probably enjoy it.

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On the relationship between orgs and crowdsourcing

The model shows institutions and market as a p...

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Good post at Warren Ng’s blog:

Corporations exist for a reason. That reason most likely is attributed to the power of many, yet corporations break down when executives make bad decisions and the remainder of the company suffers. Promotions and bonuses are put on hold or worse jobs are lost. Seems that corporations haven’t figured out how to utilize the man power effectively.

My reply:

You’re making some important points here (and adding some much-needed balance to the breathless claims that crowdsourcing will replace the corporation). The reason for traditional organizations to exist is largely based in Coase’s theory of the firm: the transaction costs of using a market are minimized or eliminated when performed internally by a firm. Crowdsourcing shifts some of those activities out of the firm by providing lower transaction costs than the firm, something difficult or impossible prior to social media technology.

Savvy entrepreneurs in the crowdsourcing space are beginning at the point of determining which organizational processes lend themselves to being performed outside of the firm, whether they are viewing their value proposition that broadly or not (incidentally, outsourcing and offshoring were both precursors in the attempt to seek lower transaction costs). There are some processes that will probably always stay within the firm–primarily those administrative activities that cause a firm to cohere. This is currently exemplified by the tendency of most new commercially-focused crowdsourcing ventures to form a company first, then sell the results to another company. At present it is more efficient for a company to seek funding, hire staff, and build platforms within a traditional company structure. That may not always be the case.

It’s interesting to contemplate the evolution of organizational forms as technology enables new arrangements. It challenges a great many of our assumptions. That said, I should probably leave it there lest this comment become a post of its own.

Too late.

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Social network analysis exposes Panty Bomber’s habits

This post describes the methodology used to map Umar Farouk Abdulmutallab’s online communications:

Given our specific interest in the online behavior of Umar Farouk Abdulmutallab, we were most interested in analyzing the direct and indirect communication network associated with the handle “Farouk1986” (aka Umar Farouk Abdulmutallab).  Therefore, it was necessary to filter the broader universe of communication on to the relevant subset.

A portion of this information is contained in publically available NEFA dataset.  While useful, we determined that this dataset alone did not include the information necessary for us to construct the Farouk1986 secondary/indirect communications network. In order to obtain a better understanding of this communication network, we retrieved every “topic” in which Farouk1986 participated at least once.  Each “topic” is comprised of one or more “posts” from one or more users.  Each “post” may be in response to another user’s “post.”  The NEFA data contains only posts made by Farouk1986 – our data contains the entire context within which his posts existed.

The table of the ten most frequent participants in his network is interesting; I suspect I would be soiling myself if my handle were “Crystal Eyes” or “property_of_allah”.

Terror plot a “cascade of failures”

Washington Capitol, DC

Image by Diez Photography via Flickr

A New York Times editorial today reviews what happened in the terror incident two weeks ago on Northwest Airlines Flight 253:

The report implicitly acknowledges all of this, saying that the system failed “to identify, correlate, and fuse into a coherent story all of the discrete pieces of intelligence held by the U.S. government” about both the Al Qaeda group and Mr. Abdulmutallab. It also makes clear that this was not a single failure by one agency but was a cascade of failures across agencies and departments and the bureaucracies that are supposed to coordinate them.

It says that once the government learned of a possible plot in Yemen, the intelligence community failed to devote more analytic resources, and it failed to put one agency or official in charge. John Brennan, the senior official responsible for figuring out what went wrong, said on Thursday that only after the failed plot did the intelligence community recognize that the group, Al Qaeda in the Arabian Peninsula, actually posed a direct threat to the United States. [emphasis added]

This is a fairly straightforward explanation of the problem.  The problem is not individual, but rather systemic.  There are never enough analytic resources to adequately process the overwhelming volume of data collected by the IC, but that is not the primary problem.  The overarching challenge to the IC is that authority, budget, and power are spread across its agencies with no clear leadership or accountability.  Every 8-year-old kid knows what happens when one kid is in charge of building the treehouse and another kid has all the lumber and nails.  If there is to be reform–and it has yet to happen in the past eight years–consolidating budget and accountability is the most powerful lever.

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Best sentence on intel in 8 years

Perspicacity points to Doyle McManus:

“By shining light on organizational dysfunction that’s hard to dramatize, the attempted bombing has highlighted a problem that desperately needs to be solved.”


Walt Disney’s org chart

Submitted without comment:

Normal accidents and the financial crisis

Brayden King of recaps a conference he attended this weekend on organizational dynamics in the financial crisis:

The papers were very diverse, but one idea came up in several papers. The idea was that the crisis was a kind of normal accident that was made possible by the organizational structure of the financial system. As Charles Perrow theorized, accidents can be thought of as the product of organizational systems that are highly complex and tightly coupled. Decision-makers have a hard time figuring out how the system works as a whole due to its complexity, but when one part of the system breaks down, for whatever reason, the entire system is vulnerable to collapse due to the interdependence of the different parts.

Normal accidents is a favorite theoretical foundation for explaining such debacles as space shuttle disasters and nuclear accidents.  Scott Sagan’s Limits of Safety is a particularly useful application of the theory, holding normal accidents against the idea of high reliability organizations to examine why there have been no catastrophic nuclear accidents (clearest indication that normal accidents might make sense:  there have been a hell of a lot of near misses).

I wish I had attended the conference.  Drawing on Sagan a little more, I suspect that normal accidents in a financial system might very well provoke even greater efforts toward high reliability organizations, which would in turn eventually suffer normal accidents.  I would also have enjoyed hearing King’s take on the topic–his work never fails to challenge and stimulate.