Yes, government organizations, in general are inefficient; a large number even grossly so. I will still argue in this article that they dont have to be. I will also get to the root cause of inefficiency in all types of organizations
There is nothing inherent in a government organization - as opposed to a private organization - that makes it inefficient. You can say job security but a lot of private organizations such as large corporations, trusts, welfare organizations have a good deal of job security once you stick in them for a couple of years. That couple of years barrier is in government jobs too, your job is not secured from day one in any organization. Small businesses have pretty much job security for life because you would rarely see them firing employees. Thats for public in large. For family members family businesses have pretty much a secured position since start. Yet you dont see same level of inefficiency in the stated private businesses as is common in government organizations. Why?
Is it corruption? Goverment organizations all over the world are indeed extra ordinarily corrupt. Individuals in power take away tons of money for personal benefits at the cost of other members of organization that are too powerless to stop them if not also damaging the country as well. But same happens in private institutions, just that there its called profit taking. Still private organizations in general tend to be far more efficient than government organizations.
It cannot be job security as already discussed, it cannot be corruption. What then?
You may say that its subtler than that. That it isn't firing but the threat of firing that keep people in line in private businesses. Well, that can be answered in one word: career. A private employee who knows his trade is not much affected by getting fired because other similar businesses will happily hire him. They have to, they after all need people to make money. A private employee make a career anyway, not a particular job tenure.
You will say that yes thats well and good for skilled and hardworking people but you are looking for inefficiency so dont look there. Look at unskilled-for-job or lazy people thats where you will find inefficiency. You will say that while such a person will certainly have tough time staying in a private job he can still survive in a government organization because of inherent and guaranteed job security that comes only with government organizations.
Like propaganda it do convince a lot of people, till they experience facts. Any person who has worked in a large private organization such as a corporation or a large factory will note that even in private organizations a lot of people that dont know how to do their jobs or are unwilling to do it well, do get by. They dont get fired. They dont get promoted either but still they stick.
Did you notice the cause of inefficiency?
Any large organization, irrespective of it being government or private will suffer from inefficiency. It cannot be avoided as long as the organization is large.
Why only large organizations? Because they have what medium and small ones dont have. There are 2 such things: Shadowing Effect, Extra Features. First one is negative, second is positive.
Shadowing Effect is when incompetents and lazies hide behind competents and hard workers. This can only happen in large organizations.
Who they are hiding from is the key to both understand and solve the inefficiency problem, as much as it can be solved and is desirable to solve.
They are hiding from those who have the power to punish them. Owner of a private business obviously can fire any of his employee, and can also punish in other ways, from as little as taking away a comfortable chair to as harsh as withholding salary to any thing in between such as forcing to stay extra hours; but its not just the owner who has such a power, it can be any other manager who is given that power by the owner. In a government organization its usually the head of entire institute that can fire, head of department that can force to sit extra hours and immediate incharge / head of section that can take away a comfortable chair.
It dont matter how many punishers are there in an organization, and above a certain level of punishment it dont matter how harsh the punishment is. What matters is how obvious the employees are to those who can punish them.
If those that can do something cannot see whats happening, then they cannot know what needs to be done and are guaranteed to be not effective.
The key to reduce inefficiency is to put every employee in clear line of sight of a punisher i.e. not hidden under layers of management.
Closer the bad workers are to those who can punish them less bad they become.
If a section (sub-department) is specially lazy give its incharge one more level of power to punish, that is, make workers stay extra hours and other punishments like that. If a section is extra ordinarily lazy then give its incharge power to withhold salary.
Harsher the punishment, quicker the result.
Another less effective way is to make upper managers more open to suggestions of punishments from lower managers. This is less effective because there is element of indirectedness in it. First those that can see but cannot do have to convince those that cannot see but can do that something needs to be done then argue about what needs to be done.
These are levers, however, and can be adjusted as per the trend of any given moment. Give more power to immediate and middle level incharges when organization is lazy and vice versa.
Final point that I want to discuss is that not all inefficiencies are bad, some inefficiences are good and therefore desirable. As an organization size grows it can provide more features and its generally expected to provide extra features that nobody ask from a small organization. A corporation in general is expected to be well versed in law and more law abiding than a small business. A platoon (around 30 soldiers) can never be expected to have its own field hospital but a regiment (around 1500 soldiers) have to have one. Its this burden of extra features that slows down the matters, burden that cannot be avoided as long as the features are being provided because simply put you cannot get something out of nothing the costs have to go somewhere. The features themselves shouldnt be dropped because doing so will reduce not only the well being and thus moral but it may also loose the cutting edge that actually win you war and business.
As a bonus point I will now talk about sizes of organizations in concrete terms. I will not run away by using vague terms: large and small. I will quantify instead.
First of all by size I just mean number of people in it, no other metric.
A person can directly command 3 to 5 people. A group would be of size 4 to 6. All in group do the same work. At the next level we have a team, which will combine different skills to actually produce a sellable thing. These different skills are usually just 2, and sometimes 3, never any other number. This is another insight I am giving you. A person can directly command 3 to 5 people, and it takes 2 or 3 groups to make a team. Team size would be between 8 and 18, but its not. Its between 8 and 12. 8 is minimum because 2x4=8. 12 is maximum because when you need 3 groups you dont need each of them to be of size 5, size 3 or 4 will do, so 12 is the maximum. Another way to look at it is that 4 is average size of group and a team then needs 2.5 groups on average so 4x2.5=10 which is average of 8 and 12.
A team can be called a section, also a sub-department. While its enough to produce a sellable thing its not very stable because its able to produce just one product. I will go for 2 to 3 products. That will make a small company. Size between 20 and 30 i.e. 8x2.5 to 12x2.5. So 25 is average.
Next level up is first level of middle sized company. Size between 50 and 75.
Next level up is second and last level of middle sized company. Size between 125 and 187.5.
Last, and I will argue the largest size an organization which is not military should have, is between 312.5 and 468.75.
No matter what you do dont make organizations (which are non-military) larger than 500. If you do you will face Shadowing Effect.
Organizations of sizes less than 300 are not desirable because they cannot afford to have necessary features. Organizations of sizes upto 400 are better but beyond that you should apply breaks.
To conclude, its the size of organizations thats the root cause of inefficiency in organizations, not job security, not corruption, not profit taking. In a small enough organization people who have power to punish can see the non-qualifieds and the slackers and can punish them. Ideal organization size is between 300 and 500.
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