Michael Pezzullo: empire of rules or commonwealth of ideas?

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Beneath the clinical, flat surface of bureaucratic language — with its terms such as ‘outputs’, ‘outcomes’ and ‘deliverables’ — lies the real world of human activity. A well-functioning modern state needs to operate in the real world, where the sick are treated, children are educated, roads and bridges are built, water and energy are provided, crimes are investigated, borders are protected, along with more besides. The modern state undertakes the core activities that are required for the performance of these functions, or arranges for and regulates their provision.

As public servants, we are engaged in activities that have real human impact, performing tasks which address human hopes, dreams, anxieties, fears — and which encompass the entire hierarchy of human needs, from survival and subsistence, to the life of the mind.

In his great book Political Order and Political Decay, Francis Fukuyama contends that political order is not solely concerned with the exercise of power by political parties, or the balance of powers — for instance, as between the executive, the legislature, and the judiciary. Nation-states can indeed possess all of the requisite formal features of the rule of law, and the separation of powers, and still be incapable of delivering basic public services.

As officers of the Australian Public Service, we should be very proud of how we measure up in these terms. We contribute to the functioning of a well-ordered and administered society and economy, which coheres and prospers as a result.

Regrettably, our work is not always seen in such a light. The narrative of bureaucracy has a particular and indelible emplotment, or literary structure — namely, that of satire. We are seen, unfairly you might say, as underwhelming ‘pen-pushers’, or masters of inaction. Now we’re all familiar with the satire of Yes, Minister and Yes, Prime Minister, and in more recent years The Hollowmen and Utopia, and we tend to laugh when watching these satirical comedies because we recognise the familiar — that is indeed how satire works. Moreover, as someone once said, ministers and secretaries tend to laugh at different points in these shows, which further suggests that they are representing back to us something which we recognise as somehow ringing true, at least at some level.

Now the plotlines of these satires tend to play on recurring themes: ‘bureaucracy’ (and I use that in inverted commas) is about process over content; the triumph of the tactical over the strategic; power games between ministers and officials or between agencies; the preservation or enhancement of position and privilege; the acquisition of resources and status; an aversion to risk — who could ever forget Sir Humphrey saying, ‘That would be very courageous, Minister’ — and, ultimately, a disconnection between the games of power as against a focus on content and purpose. These satires tend to play on the meaningless language of ‘officialese’, where bureaucratic rules and their manipulation conceal inaction, self-interest, and ineptitude.

This is no laughing matter, however. If we were to look at our recent history, we would have to accept that when read together, any number of recent reports of commissions of inquiry and external reviews, as well as the series of APS capability reviews, would suggest that there are some real issues at play here. These reports variously demonstrate, on occasion and to varying degrees, a lack of policy acumen; unhealthy risk aversion; the tight control of information and overlycentralised decision-making; information and power silos; the limited ownership by senior executives of strategic directions and decisions; a lack of innovation; a narrow focus on internal corporate issues as a substitute for a focus on organisational strategy — or, far more importantly, questions of national public policy. If you do not accept this thesis, or the evidence for it, I would challenge you to read with an open mind the report recently prepared and released by Dr Peter Shergold, the former Secretary of the Department of the Prime Minister and Cabinet, on the failures involved in the design and delivery of the Home Insulation Program, which is entitled Learning from Failure.

Dr Shergold found significant deficiencies in terms of the quality of advice and record-keeping; dysfunctional relationships between ministers and their staff on the one hand, and officials on the other; poor comprehension of risk and risk management, as well as programme design and programme management; and a general incapacity in relation to effective implementation and delivery.

Four young Australians died as a result of these failures. I’m very proud that the Secretaries Board, which is chaired by Dr Martin Parkinson, the current Secretary of the Department of the Prime Minister and Cabinet, has directly taken on the task of leading and overseeing the necessary remediation work. We need to do this: we owe it to the Australian community that we serve; the Government and the Parliament of the day; and ultimately in fact to ourselves, because we know that in our hearts we are better than this and we should strive to do better than this.

Rules regulation & ideas cultivation

Now, are there deeper structural issues at play here? I contend that there are. I would argue that there are two great tendencies within the bureaucratic apparatus of the modern state: the tendency to rationalise and regulate human conduct through rules, and the tendency, on the other hand, to seek new ideas about how the state might best play its role in the improvement of the nation that it governs. For convenience sake, I will call the former tendency the ‘empire of rules’ and the latter tendency the ‘commonwealth of ideas’. These tendencies can often be in tension and sometimes they can grind against each other like misaligned or damaged gears. We need both tendencies to be present in any bureaucratic system and we need to build a gearbox of state such that it does not grind.

Now a slightly theoretical insight, if I may, just momentarily to explain. I take these insights and I derive them from the work of the great sociologist and political scientist, Max Weber, who of course wrote at the turn of the century — the last century — about modern bureaucratic systems. And he argued, he was a great socialist who wrote at the end of the 19th century — a sociologist, I should say, who wrote at the end of the 19th century and the early 20th century. He argued, after a lifetime of study of state formation over the ages, that the modern bureaucratic system that had emerged at the time was highly efficient and was the best in history because it worked impartially and impersonally — it worked objectively. And he argued that the features of the modern bureaucratic administration — and this is 100 years ago, but I contend that these insights still pertain today — the features of the modern bureaucratic administration that make it so dominant in terms of effectiveness in world history are precision, continuity, repeatable performance and calculability of results, unity of direction and the alignment of goals and strategy, plans and activities, along with the creation of an auditable record of resultant actions.

However, he also argued — and this is 100 years ago — that the system could actually become too efficient and he famously talked about the ‘iron cage’ emerging over time of a rule-based model of rational control permeating all human affairs. For today’s address, I will call this system in its purest form the ‘empire of rules’. Ultimately, Weber argued, that value-orientated conduct, which is informed by moral calculation, political perspective and strategic vision, is required to oversee and mitigate the impersonal features of bureaucratic administration and its tendency to rule-based control of human affairs.

Now such a system which is geared and limited to administering an empire of rules, as I’ve labelled it, is never likely to meet the criteria for a fully functional state which exhibits capacity, capability, reach and impact. An empire of rules, with its clinical, flat focus on process, will always be the ‘iron cage’ of which Weber warned.

Now, like the two authors I have thus far quoted — Max Weber and Francis Fukuyama, and certainly I could probably associate Dr Shergold with these remarks as well so I’ll add him to the group — I can certainly appreciate the importance of technical expertise and professional mastery, absolutely. When I’m sitting on a plane, I have to trust the technical competence of the flight crew, the maintainers, the air traffic controllers and indeed others. In that moment, when I’m on that plane, I am assured by the existence of the ‘empire of rules’ around aviation and indeed it’s an empire which ensures repeatable, consistent performance; quality assurance; and requisite credentialing.

However, no system is ever closed, nor solely improved by internal reflection and adjustment. The ‘empire of rules’ cannot shield itself behind the laws of process and technical language against the uncertainty, unpredictability and contingency of the world which is to be found beyond the limits of the empire. No meta-rule can be written within this empire to codify and negate shocks and disruption in the external environment, which is supposedly beyond the empire’s limits — except it never really is.

‘What does a better society look like and how do we build it?’

We need, indeed, to subvert the very idea of a closed system, which in bureaucratic terms asks this question — this is the closed question: ‘are we meeting our formal targets in terms of programme management and service delivery?’ A very valid question. In an open system, this should be the question: ‘why should these targets represent what we measure and what we do?’ What indeed should we be doing differently and what else should we measure in order to build a better Australia? No meta-rule can be written to codify the place in this empire of imagination, vision, instinct, foresight and ultimately policy value — which all go to the question of ‘what does a better society look like and how do we build it?’

Where the ‘empire of rules’ is incurious, focussed on process and seeks always to rationalise and order the world within its fixed system of rules, in the sense meant by Weber, the ‘commonwealth of ideas’, I would contend, is curious, engaged with the world and inherently always seeking to pivot, adjust and transform the rules and processes of state. Shocks in the environment are to be expected and represent opportunity. In managing an ‘empire of rules’, one is more likely to become detached from purpose; however, in the ‘commonwealth of ideas’, purpose and content are everything.

My colleague, our colleague Dr Martin Parkinson, Secretary of the Department of the Prime Minister and Cabinet, has illuminated our path in this regard in an excellent paper which I commend to you all which was published last year by Princeton University, by their Centre for Economic Policy Studies in September of 2015.

In his paper, Dr Parkinson draws attention to a number of megatrends, which I won’t deal with in any detail this morning other to make the point I’m about to. But the four megatrends are the explosion of technology, issues around resource sustainability, demography and shifting geo-economic weight and the resultant new geo-political forces which are resulting in pressures on global governance.

For the purposes of this address, as worthy as each of these areas are of individual and specific attention, the key relevant point in Dr Parkinson’s paper is that closed systems and structures, which are centrally organised with rigid modes of operation and limited openness to exterior forces, will not be able to adapt in this environment and in the face of these forces.

So, what is to be done? Today I would like to propose four concrete strategies to deal with the problem of the closed and incurious system which is inevitable feature of what I have labelled as the ‘empire of rules’.

Research and planning

First, we need to invest in policy research and planning. Policy research and planning should not be an abstract endeavour which is unconnected to action. It should in fact animate everything that an agency does — strategy, programme management, regulatory affairs, service delivery and field operations. Policy research and planning should be contestable, argumentative and anything but clinical and flat. It should challenge ‘group think’ and policy biases. Evidence for policy should be sought and tested, such that policy ideas are conceived imaginatively and then beaten against the anvil of reality through experimentation, survey, measurement and other forms of research. We need to be careful to avoid, however, creating the impression that this process is analogous or indeed identical to the discovery method of the natural sciences. Policy research and planning involves a constant play of vision, values, imagination and indeed normative assumptions.

I recently finished reading the first volume of Niall Ferguson’s magnificent biography of Henry Kissinger, entitled Kissinger: 1923–1968 — The Idealist. This was the period of Kissinger’s life up to but before he took up his appointment as President Nixon’s national security advisor. The relevance of that insight is as follows. Kissinger was highly critical of US foreign policy and national security decision-making prior to his entry into the White House. He saw it as possessing neither rationality nor consistency. He argued in various academic papers and in other insights, of the day-to-day operation of the machine of US foreign policy absorbed senior executive attention and energy. Decisions were avoided until they appeared as administrative conflicts within the inter-agency machine, which required attention and the establishment of consensus. Senior executives did not have the time or the inclination to become involved in planning, which necessarily involves conjectures about the future and the consideration of hypothetical cases.

Against this orthodoxy, Kissinger contended that conjecture in foreign policy is indeed central and the practice of foreign policy and national security requires an ability to project beyond what is known, with often very little to guide policy-makers except their convictions, policy skills and historical perspective. Kissinger argued that the ‘spirit of policy’ and that of bureaucracy are indeed diametrically opposed insofar as the essence of policy is its contingency, whereas that of bureaucracy is its quest of certainty and closure. Absent a coherent policy framework, bureaucratic activity could sometimes be mistaken for meaningful action, which has to have impact in the real world and on the unfolding historical process with which policy is concerned. And, indeed, Kissinger argued strongly for the power of ideas and a guiding conception to inform the visible plays of diplomacy. And he often remarked, in so arguing, that orderly procedure is not the chief purpose of government, but its indispensable aid.

I’m very pleased that my Department has responded very positively and enthusiastically to the challenge that the Commissioner and I have presented it of engaging afresh in policy research and planning. We’re undertaking a very ambitious programme in terms of generating new thinking about borders, trade, travel, migration and maritime security — drawing together internal research and policy development, as well as external work which has been done in partnership with bodies such as the Australian Strategic Policy Institute, the Lowy Institute for International Policy, the Australian National University, the CSIRO, amongst others.

Historical perspective

Second, moving beyond policy, research and planning. Ensure that you understand your past. Invest in cultivating institutional memory and historical perspective. Now, of course, what is happening today, or that which is yet to occur, has not happened before — but it is built and will be built upon the foundations of what has occurred before. The future stands on the building blocks of history, and the latter contains clues, analogies, patterns and sometime an eerie foreboding of what is to come. A longer term perspective helps us to gain our bearings from the past in relation to emerging trends or issues. Knowing the history of a policy field adds depth and perspective to our comprehension of the choices that we face.

Now I do not mean by this institutional sentimentality or an overly reverential sense of memory and history. We have to avoid what I term as the ‘coffee table book’ or ‘memorabilia’ view of institutional memory and history. I find, frankly, when I’m challenged as I sometimes am about the so-called loss of institutional memory in the former Department of Immigration, I discover — once I unpack the charge and look at it closely — that I’m sometimes, not always, dealing with lore — ‘L-O-R-E’ — nostalgia and sentiment rather than a detached and strategically useful institutional memory which might usefully illuminate which and what of the former glories might be adapted and modernised for the challenges of today and tomorrow.

Now let me be very clear on this point. Long tenure in an agency certainly engenders a deep and fine-grained understanding of how an organisation operates and makes decisions, what are its informal power and authority structures, and who are the key influences. This is knowledge that is borne of rich experience and is of significant intangible value. And indeed, often the highest performing members of teams tend to have this rich institutional knowledge base. However, long tenure can also sometimes — and I stress sometimes — bring with it disengagement, a sense of entitlement and even cynicism. We have to strike a balance: how best to move on the unmotivated and the underperformers, consistent with fair process and human dignity? How do we extract the considerable value and knowledge that long-serving officers possess, even in cases where they might not be as motivated to perform as energetically as they might once have been? And indeed — and this is the sweet spot — how do we provide long-serving officers with a chance to ‘relaunch’ themselves with new skills and professional personal capabilities?

I should say this in regard that I largely agree with Laura Tingle, who wrote in her recent Quarterly Essay, Political Amnesia: How We Forgot to Govern, that the loss of corporate memory — and I’m limiting these remarks to the public service rather than to our parliamentarians or to the media, so these remarks are limited to the public service — the loss of corporate memory, amongst other things, could become a threat to good policy making. I do not agree that this has occurred in my Department, especially where the new thinking about borders, migration, trade, travel and labour mobility, amongst other things, is coming as much from officers with backgrounds in strategy, diplomacy, intelligence, law enforcement and much more besides, as it is from officers with longstanding and highly-valued Immigration or Customs pedigrees. In our case, the magic is starting to occur where we have blended the knowledge and experience of those long-serving officers with the new insights and skills that more recent arrivals have brought with them.

Reimagined generalist

Third. Be bold with your workforce plans so that they match the goals of your organisation and equip it to meet the challenges that I’m outlining today. I’ve already touched on this a moment ago in the discussion about long-serving officers and how they should be valued and invested in. Indeed, I would argue we need to rethink the idea of the generalist public servant. As external forces radically impact the way in which government services are delivered, as contestability puts in doubt whether traditional delivery models make any sense at all, and as government re-invents itself constantly in this era of global disruption and transformation, in the ways outlined by Dr Parkinson in his Princeton paper, it is not easy indeed to see how the generalist public servant will be able to maintain the requisite level of skills and subject matter expertise to keep up.

Now I’m not speaking here of career vocational streams such as policing, nursing and military employment categories. These vocational areas tend to have very well developed professionalisation models, with structured learning and development systems and active career management processes. For instance, the posting cycle in the armed services.

I’m speaking of the generalist, who will have often worked in the one department or agency for their whole career, with largely ‘on-the-job’ credentials. We need to respect and invest in such staff, capitalising on their rich experience and local knowledge, while challenging them respectfully to consider new opportunities to learn, develop and grow. Mobility is a very good thing, especially mobility across departments and agencies. We should not see this as ‘disloyalty’ somehow to the institution — and indeed I would argue there is no such loyalty. We should only have a loyalty to serving the Commonwealth of Australia.

I should like to spend a few moments speaking about the Executive Level officers of the APS. These officers, and there are many I’m sure and with no doubt are in the room today, are the critical layer of leadership and management which connects the strategic leadership of the department and the teams which undertake the local work. The day-to-day business of public administration occurs here. We are undertaking, in my Department, an EL leadership capability assessment to ensure that our EL officers are equipped with the leadership capabilities and the skills required to perform this role. And we’re also at the same time examining EL spans of control and work value, as well as sub-branch team structures and functional accountabilities.

As our work changes in the Australian Public Service, with the introduction of greater levels of technology, data fusion, predictive analytical systems connected to enterprise level information and the like, we will need to see the emergence of the new Executive Level officer who can translate strategic contexts into local context and work priorities, who understands new technologies and associated business processes, and, above all, who will lead teams where increasingly ‘digitally native’ younger staff will often be more technically proficient than their bosses. This will require an ability on the part of our new Executive Level officers to comprehend and solve complex problems, an intellectual attitude which is informed by curiosity and inquisitiveness, and which is willing to reach out to new information sources and analytical models, and an emotional attitude which is more akin to that of a coach or a film director who can bring together diverse talents, forge a team, and who knows and understands people — including when to get them focussed and when to leave them be, when to nurture and when to counsel, and where, if necessary, to warn. We need to equip our Executive Level officers with the skills to do this, and then we need to support them as they go about their onerous leadership and management duties.

Communicate clearly

Fourth and last. Because our work is so reliant on effective communication, we should insist on the latter. We should insist on effective communication. In all of our work we should reject jargon, imprecision, hackneyed phrasing, woolly terms, padding, and unclear thinking and language. All of our work requires clear, crisp, meaningful and expressive communication. Written and oral communication should be clear as to the following: how does what is being proposed flow logically from first principles? What are the relevant facts and relevant evidence? What analysis has been done? Which courses of action have been considered? Which is favoured of those courses and why? Clear language should reveal all of this, and it should be insisted upon.

Management-speak saps and debases meaning. It is inert. It does not animate the things of which it purportedly speaks. In management-speak, the concrete melts in the abstract. The most devastating critique of this phenomenon remains George Orwell’s essay Politics and the English Language, first published in 1946. If you have never read it, please take the time. It is quite short — perhaps two cups of coffee at most. Read it and ask yourself honestly if your writing and your use of language meets the test.

Public service writing should be clear and direct, active and accountable. Sentences should be action-orientated, lush with verbs. We should use doing words because we are doers, or we should be. The active voice should be the grammatical standard: ‘I decided’, rather than ‘it was decided’. Insist on your staff writing competently, succinctly and accurately. Frankly, any competent officer in the APS should be able to draft a cogent and logical paper of around, let’s say, 2000 words without seeking the text and template of what was prepared before. Regrettably, too often staff papers are a pedestrian and ill-thought out mash of cut-and-paste sections of pre-existing text, which may or may not be relevant to the issue. Words and meaning often part company in such taped-together, textual wrecks. Sadly, too many senior officers end up spending far too much time, often late at night, re-writing such sloppy fare. There are exceptions, but they are too few.

Winston Churchill, at the height of the Battle of Britain in August 1940, issued guidelines such as these to senior officers and staff. He observed that the discipline of clear writing saved time. When meaning was clear on the papers, energy and attention could be focussed on the merit of the different options before decision-makers. Clear writing, he said, required the discipline of setting out concisely the real points of any given issue, and so it was an indispensable aid to clear thinking. If it was good enough to insist on clear thinking and clear writing during the Battle of Britain, then it should be good enough for us.

I will give a very brief exposition of what we were doing in the Department which bears out these themes. Our reform programme recognises that we have truly entered an era of global mobility and movement as the world becomes ever more connected through the forces known as ‘globalisation’ — whereby travel, business, trade, investment, study, work and leisure, and so much more besides, are being organised on a global scale.

The Department in its new guise, which has been in its current form since 1 July last year — so we’re coming up to our first anniversary as an integrated Department — is contributing to Australia’s prosperity and social coherence in three distinct but interconnected ways. We are contributing to today’s form of nation-building with a modern day pursuit of what I label the ‘spirit of 1945’ — the spirit of when the Department was first set up in the aftermath of the Second World War — but with a very different aim. Instead of seeking out the migrants to create the families of tomorrow, today we focus on seeking out those who wish to come to our country for different time periods and for different purposes, with a focus on migrants with skills who can add to innovation and productivity, as well as of course tourists and students. The visa and citizenship systems that we will build through our reform programme will be as monumental and epoch-shaping as the post-war migration programme was that is so well-known and deeply ingrained in our society and culture.

Second, we’re building a border management and protection system which can cope with the rapidly growing volumes of visitors and migrants and goods — trend lines which will only continue to increase as the world shrinks and as Australia’s global linkages broaden and deepen. Our ability to achieve this will be critically dependent on our best asset — our people — being supported by ever improving capabilities, such as real-time data fusion, information sharing with intelligence and law enforcement partners, biometrics, and intelligence-based targeting of high-risk border movements. We will need to be prepared to operate more like other large-scale, high-volume enterprises dealing with masses of data, processing transactions rapidly in its scale and using advanced techniques and technologies to discover and deal with risk.

Third, we are a vital contributor to Australia’s role as a global citizen through our refugee and humanitarian programmes, and through our contribution to new thinking about how best to effect international protection strategies for those fleeing persecution. There is more to be said about all of these matters, but at a different time and in a different place.

Advice in the contestable government

I will conclude my remarks on the issue of the giving of advice. As a Secretary, I need to be focussed on this issue every day. Today’s advice is always going to be contestable — as between departments; with advisors in ministerial offices; and with research think tanks, academia, consultants, advocacy groups, industry groups and other sundry experts. This is not a bad thing. Drawing on diverse opinions and views is a good thing, which is conducive to the open thinking and the ‘commonwealth of ideas’ of which I have spoken today.

When we look back on the so-called golden era of the post-war ‘age of the mandarin’, we see, at least in the legend, secretaries who used to run their departments rather fiercely, probably of the type lampooned in Yes, Minister. They tended to be the sole advisors to government. The private sector largely did not generate independent knowledge through consultancies and the like. Used to having a clear monopoly on advice, one wonders how some of these gentlemen — and yes, they were all men — would’ve gone in today’s age of the 24/7 media cycle and the era of highly contested advice. In today’s environment, the role of the secretary is not to hem or constrain a supposedly ‘courageous minister’, as in the satirised stereotype of the wily mandarin who does everything to protect the department by creating false choices for ministers, or elegant paper trails which are engineered to deflect or sandbag. Today, we have to be completely conscious of the fact that our advice is going to be impacted, and properly so, by contested views. This is to be embraced and seen as the opportunity that it truly is.

And so we end this journey in the heart of the ‘commonwealth of ideas’. Open thinking will be increasingly necessary as we face the challenges ahead. Policy biases will need to be subverted and new thinking embraced. We cannot afford to be parochial and self-referential in our work. We have to embrace best practice globally, and not just in our portfolio lanes. We have to build and nurture policy capability. We have to cultivate and draw on institutional knowledge while avoiding the sentimentality of institutional lore — ‘L-O-R-E’. We have to be bold in terms of making the necessary changes to our workforce model and practices while being always respectful of fair process and dignified treatment for all. We should insist on clear and expressive communication, where clear writing reflects clear thinking.

Above all, while rules, procedures and processes will always have their place, and will always be central to the effective and efficient functioning of our society and our economy, the ‘empire of rules’ that we have built in the past can never be a substitute for the focus that we’ll need to bring in the new ‘commonwealth of ideas’ — a focus on the real world, the one that lies beyond the limits of rules and procedures, and indeed, beyond the ‘iron cage’ of a clinical and flat bureaucratised world.

This is an edited version of a speech delivered by Michael Pezzullo to IPAA ACT in Canberra on June 10.