Excess management is costing the U.S. $3T per year (2016) (hbr.org)

Article summary

The article discusses the concept of excess management in the US economy, estimating that it costs around $3 trillion per year in lost productivity. This is attributed to the growing number of people working in big, bureaucratic organizations, which can create a drag on productivity and innovation. The authors argue that while some level of bureaucracy is necessary, excess management can be detrimental to an organization's overall wellbeing. The estimated cost of excess bureaucracy is around 17% of the US GDP.

Main themes

• excess management
• bureaucratic drag
• productivity and innovation
• organizational wellbeing
• balance between management and autonomy
• risk aversion and inefficiency

What commenters say

• Some commenters believe that management is often a hindrance to productivity and can be an active impediment to getting work done.
• Others argue that bureaucracy is necessary to ensure an organization's functional operation and wellbeing, but can be stifling if taken too far.
• A few commenters suggest that the concept of bureaucracy was initially intended to improve administration, but has since become overly restrictive and counterproductive.
• Some argue that creative and autonomous work is often undervalued in large organizations, and that managers are more focused on their own career advancement than on generating value for the company.
• It is also suggested that the expansion of bureaucracy can lead to a culture of risk aversion and inefficiency, where managers prioritize their own interests over the company's goals.
• Others propose that a balance between management and autonomy is necessary, and that excessive bureaucracy can be mitigated by allowing employees more freedom and responsibility.
• A few commenters note that the perception of bureaucracy as inherently bad is a modern trope, and that it was initially intended as a means of improving administrative efficiency and reducing arbitrary decision-making.
• Some argue that the role of management is to guide priorities and ensure the long-term wellbeing of the company, but that this can be achieved through more flexible and autonomous structures.