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  • Politicians As Business Managers

    Posted by Shannon Love on May 21st, 2009 (All posts by )

    Reason puts the business management skills of politicians into perspective:

    Keep in mind that the “annihilating cuts” proposed thus far include trimming 5,000 employees out of a 235,000-strong state workforce (after a historic run-up in the state’s employee-per-resident ratio). So: Only after hiking spending by 40 percent in five years, raising taxes across the board, matching even Gray Davis’ deficits, and then getting spanked in a multi-tax suite of propositions, is California’s debased political class even beginning to contemplate a 2 percent reduction in its bloated, tax-sucking workforce. Maybe voter petulance isn’t such a bad thing after all.

    Even successful and sound businesses all across the country this year are going to lose more than 2% of their workforce by attrition following hiring freezes. Californian’s dysfunctional political system can’t even trim that many jobs in the face of near total financial collapse. 

    They’re boned and the rest of us are going to pay for it. 

     

    4 Responses to “Politicians As Business Managers”

    1. Andrew_M_Garland Says:

      Have a heart. In business, the employees are cogs in the machine, hired for crass reasons of profit and production.

      In government, each employee is someone’s friend, cousin, brother, son, or political ally. You just don’t fire people like that. It is a community, a brotherhood. (sarcasm alert)

    2. david foster Says:

      Even with businesses, organizations that don’t *directly* face a market test tend to be less successful than those that do.

      For example, Drucker compared two foundries, both of which were components of large manufacturing companies. In company A, the foundry was a purely internal operation–it made castings only for use in the company’s own manufacturing operations. In company B, the foundry made castings for internal use, but was also allowed to sell its services on the open market.

      Over the years, Drucker observed, the company “A” foundry did a workmanlike job, but nothing spectacular. The same guy ran the place for well over a decade. The company “B” foundry, on the other hand, was continually at the forefront of innovation–and several of the foundry managers had been promoted to other parts of the business.

      See my post two school systems–and two foundries.

    3. Shannon Love Says:

      David Foster,

      Even with businesses, organizations that don’t *directly* face a market test tend to be less successful than those that do

      Yes, I saw a lot of that in the computer industry where internal use development was fairly lame and stagnate compared to customer driven development.

    4. david foster Says:

      For those who haven’t already seen it…this post is about the life of a Soviet-era factory and the experiences of its director.

      May provide some worthwhile preparation for American businesspeople re life under the Obama/Pelosi/Reid economic philosophy.

      Although it’s not totally clear that these three would really approve of the level of autonomy that Grigory Neposedov was able to carve out for himself and his factory…