Author: America Inc. Needs Better 'Corprate' Management to Avoid Catastrophe
As voters begin to focus on selecting the next CEO of America Inc., a business professor says it’s time to start addressing some serious management problems that could threaten the future of the enterprise.
In a new book, “The Mismanagement of America Inc.,” Lawrence G. Hrebiniak (pictured), an associate professor of management at the University of Pennsylvania’s Wharton School, says the government has mismanaged the nation’s resources and is organized in a way that almost guarantees waste, conflicts of interest and incompetence.
It’s time, Hrebiniak says, for citizens – the “shareholders” of America Inc. – to protect their investment by demanding that the "managers" in Washington enact reform.
“We can’t pull our money away,” as the shareholders of private-sector corporations can do, Hrebiniak said, “but we certainly can scream and shout and demand that Congress do things.”
On the top of the list, Hrebiniak said, should be getting the government’s fiscal house in order. That, he says will require fiscal discipline from Washington and a willingness to reorganize, restructure and rethink everything it does – things that corporations in the private sector do all the time.
A good example of how the government gets it wrong, Hrebiniak says, is how it manages its $100 million-per-day expenditures for intelligence gathering and analysis.
“When I looked at the intelligence community, I came to the conclusion that it’s a really big mess,” Hrebiniak said.
From a management point of view, Hrebiniak said, it makes little sense to divide intelligence duties among 64 agencies, most of which have little contact with the others and all of which compete with each other for increasingly scarce resources.
Much better, he said, might be to restructure those agencies into a small number of groups devoted to specific kinds of intelligence gathering activity, such as foreign intelligence and electronic surveillance. Each of the groups could then report to group chiefs, who themselves would report to a single person.
If you think that sounds like the time-honored business practice of flattening and streamlining an inefficient, a bloated, organization, you’re right.
Hrebiniak acknowledges that these issues have been discussed for a long time, with limited effect. But the time has come, he says, to set aside cynicism and resignation and act. The reason: The nearly $10 trillion national debt, along with looming, huge obligations for Medicare and Social Security could lead to national bankruptcy if not dealt with soon.
Hrebiniak acknowledged that the private sector of not perfect. Nobody, for example, would want to see the government emulate Enron Corp., for example. But he says Washington could improve a lot if it adopted some of the best practices used in the corporate world.
Some of Hrebiniak’s specific suggestions for American Inc. are:
Control debt: Doing this could involve adding a balanced budget amendment to the U.S. Constitution, passing a workable line-item veto, eliminating “earmark” amendments that tack unrelated spending to appropriations bills, or some combination of the three.
Do some strategic planning: Good corporations occasionally take a top-to-bottom hard look at what they are doing and how their game plans could be affected by long-term trends. The government should do the same thing.
Pass strong ethics reform: If public servants are to be trusted to act in the public interest, conflicts of interest should be minimized. Closing the “revolving door” between government and Washington lobbying firms is a good place to start, Hrebiniak says.
Simplify the tax code: Corporations are always looking at how to collect money in better, more efficient, ways, Hrebiniak said. Government would be wise to do that, too.
To learn more about Hrebiniak's book and his suggestions for the government, watch a video interview posted online by the Wharton school. It's posted on YouTube here: www.youtube.com/watch?v=kwQWGNWzlGM.
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As voters begin to focus on selecting the next CEO of America Inc., a business professor says it’s time to start addressing some serious management problems that could threaten the future of the enterprise.
