An Exception to Every Rule? The Implications of that Fact of Life

Once upon a time, I was put in charge of a fairly large organization that was having some serious difficulties.  One of those was a large employee turnover rate.  One of the items we decided that we needed to address was how we were dealing with individual generic promotions and salary increases.  The organizational leadership reached agreement fairly quickly on what would be a fair and equitable outcome and what criteria we should establish to achieve that.  So we wrote some general guidelines that we would follow.  These were fairly simple, straight forward and short (about a page).  Before long, people began to find some exceptions to these.  There weren’t a lot of exceptions.  I thought that an understanding of what we had agreed would be a fair outcome and a little common sense should allow these to be effectively dealt with by the individuals involved.  But I discovered that people like certainty and clarity and so there was a demand for some rules to deal with the exceptions.  So we added these.  And then discovered that these new rules also had exceptions, so we would need more rules – which also had exceptions.  Before long, we had enough rules that I was having trouble remembering them all.  Not only that, but people were becoming focused on following the rules and seemed to be losing sight of the original objective of producing  fair and equitable outcomes.  At some point I came to believe that we should scrap everything and start over with a clean sheet of paper, but no one seemed to want to do that either.

The lesson that I took from this experience was that the more rules, and the more specific the rules, the more exceptions we have and the more rules we need.  A few years later I read Philip Howard’s book, The Death of Common Sense.  In the book he says that with the best of intentions, government has developed thick rule books and processes that replace thinking and individual responsibility.  Not only, he says, has this been inefficient, but the results in many cases don’t make sense and don’t accomplish important goals.  My experience says Howard is right.  Howard gives lots of examples from many different areas, but one of my favorite personal example is the Federal Income Tax.  Over the last 30 years, the U.S. Congress has “simplified” the tax code several times.  Each time that has happened, it’s taken me longer to do my tax returns (I used to do my own).  When this started, the personal income tax guide I used was probably less that 100 pages – the last one I bought (in 2011) was 982 pages long.  And we’re told the outcomes are still not “fair and equitable”.  A recent example from a different area is in the latest report on the BP gulf oil accident.  We’re told (from newspaper reports) that BP put too much emphasis on “employee safety” (because they had lots of rules written about keeping employees safe).  But, of course, they didn’t keep employees safe?  What’s wrong with this picture?

Why is it that the best of our intentions go astray?  The easy answer is that we have eliminated common sense.   People don’t think.  If they follow the rules – do what the regulation processes tell them to do – they can’t get blamed if the outcomes are not what we want.  In our political culture today, the rich in the private sector get blamed for self-interest.  But, in truth, we all want to protect our own self-interest – it just happens in different ways.  We suspend common sense and individual thinking and responsibility at the risk of everything we’d like to accomplish.  There are basically three fundamental problems with the “rules” approach:

  1. It’s difficult to anticipate everything that may arise when we write the initial rules.  Even if we could, the world changes.  Some things that were written yesterday won’t apply tomorrow.  In addition the Law of Unintended Consequences is still in full force and effect.  People don’t always respond to things only in the way we expect them to.  So there will always be exceptions, and the need for revisions and clarifications.
  2. The more rules we have the more difficult it is to keep up and remember what we are supposed to do.  So the focus becomes following the rules, and we often lose sight of what the real purpose is supposed to be.
  3. People will always respond in a way that protects their self-interest.  And the more rules they have and the less responsibility they feel, the more apt they are to not rise above that.  The inherent message is that if there are specific detailed rules, I’ll be punished for not following them regardless of the outcome. But there are no rewards for following the rules.  If there is no rule, then there is always the possibility that I could be rewarded and/or recognized for doing something right and good voluntarily.

There is a lot of built-in inefficiency to having too many rules as well.  Not only do we not accomplish much of what we intended, but we spend more money doing it.  Since Philip Howard wrote the original book in 1993, I doubt that much has changed.  We’re now having legislation in the thousands of pages (before we ever have the implementing regulations written).  The good news is that we are improving employment opportunities for lots of people.  And so the bad news is if we simplified things, we would cause job losses.  The most obvious of these are government workers, lawyers and accountants.  But there are others as well – engineers, architects, human resource people, et. al.  But one of my biggest revelations came a  few years ago when I started to do management consulting in the not-for-profit sector.  There are a surprising  number of charitable organizations that exist to help people in need request help from the government for aid that they are entitled by regulations to get.  Apparently requesting help from the government is too complicated for the average person to be able to deal with.  So I’m contributing funds to charitable organizations so they can help people receive my tax dollars from people who I’m paying to give it out.  What’s wrong with this picture?


About tjc13

BE - Chem Engineering, Vanderbilt Univ, MBA, University of Tulsa - Worked for an energy and chemical company for many years and then started a management consulting business working for both for-profit and not-for-profit organizations.
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