The company’s Chief Accounting Officer (CAO) was livid. The young engineer had the gall to question the need for a weekly accounting report to the home office when he didn’t know anything about accounting processes! So the CAO spat some choice words and told the young engineer to leave and never return.
The engineer sheepishly returned to his department and reported the incident to me, his supervising engineer. I asked him to explain the basis of his questioning the report. When he did so, I laughed, then got up and waved for him to follow me to the CAO’s office.
When we arrived, I said to the CAO, “I understand you refused to listen to my engineer’s analysis of the report and ordered him out of your office.” Still upset, he replied that he had done just that and began to lecture us on how crucial this particular report was to the company-wide accounting process.
Suppressing a knowing grin, I said, “Indulge me for a moment while we listen to how the engineer conducted his analysis.” I nodded to the engineer and he began his explanation.
He had been conducting a time study of a clerical operation that involved entering departmental data in a weekly report. (The time was the late 1950s, long before computerized operations, so the entry was done by hand.) There was considerable data to record, so the department clerk had spent close to half an hour on the task.
The engineer was curious, as engineers are trained to be, so he asked where the report went next. The clerk said she sent it on to a clerk in another department. So he went there and asked where that clerk sent the report when she had filled in her information. The trail continued on through about fifteen departments, finally ending at a desk in the accounting department.
When he asked that accounting department employee about the report, she explained that about a year earlier her counterpart in the home office had notified her that the report was no longer needed, so for the past twelve months each time the report was forwarded to her, she had simply tossed it in the wastebasket.
The engineer had done a quick mental calculation—over seven hours a week times fifty-two weeks—and concluded that the accounting department was wasting over three hundred and sixty hours a year on a report that no longer had any purpose. That was the helpful message he had unsuccessfully tried to give the CAO.
When the engineer concluded his explanation, I looked at the CAO and, making no effort to hide my gotcha smile, awaited his reaction. As you might imagine, with a good deal of harrumphing, he managed to say something like “Um, well, I can’t understand . . . it was so important when it was initiated . . . I’ll notify all department heads,” etc.
The memory of this experience, among other similar ones, has proved very useful over the years. Now, every time I hear a president or member of congress whining that a government operation cannot bear a budget cut because it has been “cut to the bone” and contains not a smidgeon of waste or duplication, I say to myself, “I wonder how many of its activities are like that ‘crucial’ accounting report.”
There is an axiom in industrial engineering that any operation that does not have a continuously monitored Standard Cost Plan is almost certain to be spending ten percent more than necessary on its operations, and very likely more than that. Waste and duplication of effort can occur even in carefully monitored private businesses, in which sustainability depends on cost saving. But in government, where there is little or no penalty for inefficiency, the potential for waste is limitless. “No need to worry,” bureaucrats reason. “The bill goes to the taxpayers.”
Ironically, those who labor to reduce government inefficiency are often vilified as heartless. I’m thinking specifically of the TEA party—whose acronym, remember, stands for Taxed Enough Already—but there are many individuals and groups with similar goals. Let’s hope citizens wake up to their efforts before the irony becomes tragic.
Copyright © 2015 by Vincent Ryan Ruggiero. All rights reserved.
