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The author of this piece frames this in terms of game theory. I honestly don't follow the line of argument. To me, it's simpler. The people running the organiz

The author of this piece frames this in terms of game theory. I honestly don't follow the line of argument. To me, it's simpler. The people running the organization put the wrong incentives in place. No need to complicate with individuals playing one-shot games and then finding a way to a coordination equilibrium as a solution. In large universities at least, the problem is that most of the people running the outfit start as faculty or low-level administrators, and they move into high-level administration positions without any understanding of how to do their jobs well, or for that matter, what it even means to do their jobs well. Most do not care. As long as the higher paycheck keeps getting deposited in their account every pay cycle, they feel they are doing their jobs.

arbitrage 5y ago
I disagree -- my experience is that most of them care quite a bit.
avereveard 5y ago
> The people running the organization put the wrong incentives in place. this assume that the organizations are mishandled. you don't need to posit such a requirement, it's even simpler, as the organization grow, the cost of mistakes increase, while the margins decrease. this is what requires controls structure to be put in place, slowing and weighting down operations. it's not a bad thing either, just the result of doing business at scale. many startup that find themselves at a significant market size quickly and quietly drop the "move fast and break things" culture, for the very same reason
- TheOtherHobbes 5y ago
  Perhaps it's more the cost of personal responsibility for mistakes increases. Bureaucratic inefficiency is a huge drag on profitability. But it becomes invisible in a way that obvious mistakes and failures don't. If a new project fails, it's an obvious failure. But there's no business metric that tells a company how much it's wasting on pointless processes and paperwork. So even though the cost of wastage can be bigger than a high profile failure, it never appears in the accounts. There is a flip side, which is the rando CEO who goes on an uninformed acquisition spree and blows $x bn on companies that don't integrate and end up being a huge net loss. Or starts numerous reorgs and rebrands which add more friction to no benefit.

arbitrage 5y ago

I disagree -- my experience is that most of them care quite a bit.

avereveard 5y ago

> The people running the organization put the wrong incentives in place. this assume that the organizations are mishandled. you don't need to posit such a requirement, it's even simpler, as the organization grow, the cost of mistakes increase, while the margins decrease. this is what requires controls structure to be put in place, slowing and weighting down operations. it's not a bad thing either, just the result of doing business at scale. many startup that find themselves at a significant market size quickly and quietly drop the "move fast and break things" culture, for the very same reason

TheOtherHobbes 5y ago
Perhaps it's more the cost of personal responsibility for mistakes increases. Bureaucratic inefficiency is a huge drag on profitability. But it becomes invisible in a way that obvious mistakes and failures don't. If a new project fails, it's an obvious failure. But there's no business metric that tells a company how much it's wasting on pointless processes and paperwork. So even though the cost of wastage can be bigger than a high profile failure, it never appears in the accounts. There is a flip side, which is the rando CEO who goes on an uninformed acquisition spree and blows $x bn on companies that don't integrate and end up being a huge net loss. Or starts numerous reorgs and rebrands which add more friction to no benefit.