Tag Archives: government

A Quality Manager for Obama

nancyPresident-Elect Obama has hired a quality manager, and her name is Nancy Killefer. She is the newly appointed “Chief Performance Officer” whose mandate is to manage budget reforms while eliminating waste in government processes, ultimately making it more effective. An MIT & McKinsey alum, Time calls her the “first official waste watchdog.”

From the Washington Post:

“We can no longer afford to sustain the old ways when we know there are new and more efficient ways of getting the job done,” Obama said during a news conference this morning at his transition office. “Even in good times, Washington can’t afford to continue these bad practices. In bad times, it’s absolutely imperative that Washington stop them and restore confidence that our government is on the side of taxpayers and everyday Americans.”

This is a fantastic indication of our new administration’s commitment to quality, and its recognition that the current economic crises can only be solved by fiscal pragmatism and solid foundations.

Regardless of what happens next, I am pleased to see that our new administration’s attitude is so positive:

As he named Killefer, Obama promised to scour the federal budget to eliminate what doesn’t work and improve what does to “put government on the side of taxpayers.” He said: “We can no longer afford to sustain the old ways when we know there are new and more efficient ways to getting the job done.”

Nancy, you should join ASQ (if you’re not already a part of the organization). There are 100,000+ of us, more or less, that not only support you but want to help you develop a high-performance government. We come from all industries, are adept at process improvement at creative solutions for increasing efficiency, and can be effective advocates for your mission. Let us know how to help!

Government Plays a Role in Productivity-Oriented Competitiveness

I read an article this morning about a 13-year old Somalian girl who was stoned to death for being raped. The article also characterized, in simple terms, the social and institutional landscape of her country:

Somalia is among the world’s most violent and impoverished countries. The nation of some 8 million people has not had a functioning government since warlords overthrew a dictator in 1991 then turned on each other.

A quarter of Somali children die before age 5; nearly every public institution has collapsed. Fighting is a daily occurrence, with violent deaths reported nearly every day.

Although the issue of the level of governmental control is prominent in the 2008 election, something I reflected on a couple weeks ago, it is critical to remember that macroeconomic stability is a precondition for economic growth. If the goal is growth, not just survival, we must strategically architect our country’s policies and institutions to make it happen and to make it sustainable.

The World Economic Forum takes a “productivity-oriented view” of competitiveness. Raising productivity means making better use of the policies, institutions, and resources that are available to an organization. (Notice that this suggests productivity is actually a continuous improvement process, not simply achieving a certain level of output, or achieving targeted growth.)

This organization produces an annual Global Competitiveness Report that reports a metric, the Global Competitiveness Index (GCI), calculated for almost every country in the world. The GCI factors in elements from “nine pillars” of competitiveness: institutions, infrastructure, macroeconomy, health and primary education, higher education and training, market efficiency, technological readiness, business sophistication and innovation. The WEF emphasizes that:

None of these factors alone can ensure competitiveness… [for example] the value of increased spending in education will be undermined if rigidities in the labor market and other institutional weaknesses make it difficult for new graduates to gain access to suitable employment opportunities. Attempts to improve the macroeconomic environment—e.g., bringing public finances under control—are more likely to be successful and receive public support in countries where there is reasonable transparency in the management of public resources, as opposed to widespread corruption and abuse. Innovation or the adoption of new technologies or upgrading management practices will most likely not receive broad-based support in the business community, if protection of the domestic market ensures that the returns to seeking rents are higher than those for new investments. Therefore, the most competitive economies in the world will typically be those where concerted efforts have been made to frame policies in a comprehensive way, that is, those which recognize the importance of a broad array of factors, their interconnection, and the need to address the underlying weaknesses they reveal in a proactive way.

In my opinion, what a nation really needs to increase productivity, enhance competitiveness, and promote sustainable economic growth are two elements that are not mutually exclusive: 1) a National Innovation Agenda, and 2) a multidisciplinary team of systems engineers who understand quality improvement, with broad perspectives and a penchant for data-driven decision making, advising the highest levels of government. This team’s responsibility would be to understand the structures, health and interconnections of the nine pillars of competitiveness – and how to continually improve them as a system, recognizing that we can’t do everything and we must aggressively prioritize to achieve progress.

From the Perspective of Quality Management: Is Socialism So Bad?

I saw an article today entitled “Barack Obama’s Stealth Socialism”, syndicated by many blogs including this one. It seems that many are concerned that our nation’s foundations of capitalism might crumble and be replaced by socialism, including John McCain, who called his opponent a socialist at a Saturday, October 18 rally.

Proponents of socialism say that disparity in incomes leads to the exploitation of workers, oppression of minorities, and imperialism. Instead of maximizing profit for a minority, there is a blueprint for the economy so that profits are routed to meet the needs of the people – health care, childcare, housing subsidies, transportation, and so on. There are many socialist elements in place in the U.S. right now, including welfare and public schools.

This led me to ask: why is socialism bad? The campaign promises that resemble socialist aims – and they exist on both sides of the ticket – might seem pretty good to some people. So what’s the catch? Before you read any further, note that I’m not attempting to advocate one position over another – just to ask a difficult question that others might be asking, and see if concepts from technology management and quality management can provide some insight. With this in mind, we consider that “government”, from the perspective of technology management, is all about two things:

  • setting and enforcing standards (which includes laws, regulations and policies), and
  • providing a structure for decision making.

Both of these aspects play a fundamental role in setting up and operating quality systems, which are a form of government (on a smaller scale)! Government is different than a production system like capitalism, socialism or communism though. There are, however, often links between the two: for example, government can set the standards that influence both the means of production and how a country interacts with other countries through its economy. The difference between government and the production system is, loosely, analogous to the difference between strategy and tactics.

  • Government: Democracy is government by the people where decision-making occurs on the basis of a vote. The voting majority wins. A republic is a government in which the people delegate representatives to represent them – and make the decisions for them. The U.S. is a republic, not a democracy (ie. your vote doesn’t really count if the electoral votes that come from your state ultimately go to “the other guy”.) Democracies and republics are both systems for decision making. Fascism is also a system for decision making – but all of the decisions are unilateral, and made by a dictator (or under some sort of dictatorial control). The process of reaching a decision depends in a large part on the standards you are using to judge the context of a problem – and the opportunities available for a solution!
  • Production: Capitalism is characterized by an economy where investment and ownership in the production and distribution of goods is primarily private – through individuals and corporations. In a capitalist economy, you can start your own business and have the potential to grow without bounds. In a socialist economy, you can’t grow too much, or your excess profit is siphoned off to support social causes. Some feel this isn’t fair, and that it hinders achievement, leads to low quality products and services, and higher levels of unemployment. (The socialist agenda could be considered a reaction to inequalities in income distribution, such as those observed by Pareto’s study of the wealth distribution in Italy, from which the famous 80/20 principle was first observed – for a summary, see Levy 2001.

So why are people scared of socialism? In addition to taking the “powerball” potential out of capitalism, it also seems to be perceived as a “gateway drug” to communism (and then on to dictatorial decision-making) for the ruling parties. Previous nations that have attempted to blend socialism with dictatorships (e.g. Cuba, Russia) are held up as examples of certain doom. Other examples, such as the European socialism that’s in place today, are criticized because tax rates are oppressive at 50-60%, even though those countries blend socialism with democratic decision making. No one has “gotten socialism right,” balancing public services with reasonable costs, and doing so without eventually losing sight of fundamental human rights.

Does this mean that socialism can’t be an effective production system? No; it just means that there are no historical examples of resounding success to draw from, and the risks are palpable – which can be frightening to people. (Maybe the design of socialism in our country is just suboptimal.)

Levy, M. (2001). Market efficiency, the Pareto wealth distribution, and the Levy distribution of stock returns. Unpublished manuscript, Jerusalem School of Business Administration, Hebrew University of Jerusalem. Available here.

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