This was an interesting take from the CEO of Bayer talking about how their company had become strangled by bureaucracy (thanks to Tim Harrap for the prompt). He writes that Bayer’s internal rules for employees fill 1,392 pages, and that employees are trapped in 12 levels of hierarchy which serves to put distance between leaders and their products and customers.
His solution is pretty radical. Would it really make a difference he asks, to reduce 1,000 rules down to 900 rules? Lasting change, he says, can only come from eliminating ALL the rules and then starting afresh from a new perspective. So that’s what they’re doing – redesigning every process and every job with a ‘radical focus on customers and products’. He says:
‘Most importantly, we’re putting 95% of decision-making in the hands of the people actually doing the work. This means many fewer managers and layers, and replacing hierarchical annual budgets with 90-day sprints by self-directed teams. We have 300 of these teams with thousands of people already working in this model, which we’ve coined Dynamic Shared Ownership. By the end of the year, it will reach tens of thousands. Rather than a lumbering corporation, Bayer will emerge as agile and bold as a startup–but one with operations in more than 100 countries. I’m convinced that this dramatic change will accelerate and unlock the value creation in each of our businesses.’
As I was reading this I was reflecting on how easy it is for bureaucracy and rules (almost without leaders noticing) to grow over time. It’s always additive. In a culture of accumulation, layers of rules get added over time and the value of taking things away is often overlooked. Levels of bureaucracy in the organisation need to be regularly and proactively addressed.
Tom Goodwin has long asked a good question: what would your company look like if you built it today? The answer of course is probably ‘very different’. And that’s almost what Bayer seem to be doing. Redesigning it from the ground up. Who knows whether it will work but I applaud the ambition, and perhaps this is what it takes when you have a rule book which is 1392 pages long.
The point about layers of hierarchy putting distance between leaders and their products and customers is also something that I see a lot . It’s often true that the more senior you get, the further away you get from the customer. Rather than interacting with customers directly you’re managing people that manage people that interact with customers. This should mean that the more senior you get the harder you should work to regularly connect with real customers. I worked with one company once where every senior leader was expected to spend time with customers (perhaps in customer service, or on the shop floor talking to customers) every single week. If a leader was unavailable because they were spending time with customers it was never questioned. We need more of that.
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Photo by Nick Fewings on Unsplash
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