The Iron Law of Bureaucracy for Business & Government

In any large organization, and that includes businesses and government, the people who run that organization constitutes their Bureaucracy. Inside every Bureaucracy you will find two kinds of people:

• Some people who are actually devoted to the mission of the organization and that is to serve customers who need their services. Typical examples are dedicated classroom teachers in an educational bureaucracy, or great doctors in a socialized medicine bureaucracy.
• Unfortunately, there will also be those who are dedicated to the organization itself. Whose main goal is either to do next to nothing, and still get a paycheck, or to climb the organization’s ladders to get more power and money.

The Iron Law of Bureaucracy states that in every case the second group, let us call them the self-serving Bureaucrats, they will gain and keep control of the whole organization. They will write the rules, control promotions, and do very little to serve the customers or the public.

This is a powerful anti-agile pattern in action. And it’s also the reason behind government’s consistent low quality services in many countries. A similar phenomenon happens when a company gets large and has close to monopoly control of any market, those giant corporations usually behave to benefit themselves and not the customers.

A couple examples: have you tried to get a Google employee to reply to one of your customer support emails? It is near impossible to talk to a human being at Google. Contrast that with companies with lots of competition, like Hotels. Usually, you can find a multitude of ways to talk to a human being at any hotel.

Agile and Lean methods, frameworks and practices help private companies and governments fight this negative trend. This is perhaps one the greatest contributions Agile, Kanban, Lean Thinking and the Theory of Constraints have done for people and society, to put the customer we intend to serve front and center.

Jerry Pournelle, was the first to notice this pattern in 2010, I have updated it to cover the behavior of large organizations today, and how Agile & Lean can help.