UK: CURING CORPORATE CONSTIPATION - THE BBC. - John Birt should not dictate a reinvention of the BBC from the top, says Robert Heller.

Last Updated: 31 Aug 2010

John Birt should not dictate a reinvention of the BBC from the top, says Robert Heller.

John Birt, the director-general of the BBC, has attracted much criticism for his tax arrangements and much ribaldry for wanting to teach the corporation better management. Sending people off to play silly games which pass for management education is risible enough. But is the whole effort to improve the way the BBC manages its business equally misguided?

If the purpose is to prevent things like the muddled accounting that caused last year's multi-million production overspend, the answer must be no. Any organisation, whether public or private, needs first-class housekeeping. Efficient accounting is no less essential than excellent switchboards. That so many organisations have neither is inexcusable, but easily corrected. Professional consultants can supply all such needs at the drop of a fee.

'Management' is another matter entirely. It goes far beyond housekeeping into realms both objective and subjective. Objectively, you must ask if the company gets value for money internally (maximum output for minimum input) and gives it externally - thus creating happy customers. Subjectively, you must investigate whether people like working for the organisation, and if they feel that, in a real sense, it 'belongs' to them. Again objectively, is the business constantly improving performance on parameters that truly count? And subjectively, is strategy devised and implemented in ways that harness all the strengths of the organisation and make it stronger still?

Each of these questions could be broken down into many sub-categories, but the above are enough to show why public services like the BBC find it so hard to manage well - if at all. The first problem is: how do you measure output? In commercial TV, advertising revenue can be used. The equally tricky question - what is the optimum input? - can be measured with equally crude accuracy: that cost level which yields the desired gross margins. But since public services earn little or no 'revenue', other criteria must apply. But hours broadcast won't do as quality is king.

Quality, in its modern usage, can actually unlock the whole mish-mash. The quality technique of bench-marking (comparing cost ratios and suchlike with best practice elsewhere) is a much sharper test than gross margins. Quality also revolves round constant improvement - attained by using the combined talents and initiative of people at all levels, and thus improving relationships. Quality of output - what customers think - can be discovered as easily as employees' opinions of management.

That still leaves a pivotal matter: strategy and implementation. It is no use the Inland Revenue collecting Birt's and everybody else's taxes with utmost efficiency if the tax strategy being implemented is purblind, counter-productive, and inefficient (as it is). Poor strategy can never be blamed on people downstream. It is upstream managers who formed the strategy which people, inside and outside the BBC, have attacked 16e so fiercely. Are top managers at the BBC well-versed in how to conduct strategic process, verify its findings, establish the mechanics of implementation and feedback? And do they obtain strategic consent and support throughout the business? Without that, people are entitled to ask, whose strategy is it anyway?

Many top managers in the public and private sectors seem to believe that strategy (a) can't be planned or trained for; and (b) belongs exclusively to themselves. The solution to patent inadequacy is often to throw still more Christians into the arena: Birt is advertising for top guns in 'commercial and business policy', 'strategy evaluation' and 'business information' to sit under a new 'chief adviser, corporate strategy'. Anybody who still thinks strategy is a staff, and not a line job, should abandon hope right now.

The awful disease of corporate constipation need not be tolerated. The public sector is as susceptible to cure as the private. However, because the objectives are less quantifiable and more qualitative, treatment demands even more rigorous analysis and preparation. While Birt is certainly right to want to reinvent the BBC, he is certainly wrong to dictate it amateurishly from the top.

The Financial Times reports Birt's rightful dislike of 'territoriality, confusion of purpose and strategy', and organisation charts 'criss-crossed with dotted lines' (and incomprehensible sets of initials). All these flowed from the summit, and unless leaders move much closer to the people Birt's reinvention, like any other, will remain skin-deep.

That is not all. The BBC is undoubtedly a fine, upstanding, constipated bureaucracy. But the quality of its output, as opposed to its management, has been uniformly high, often brilliant. The old system, in its cumbersome way, hired people of phenomenal talent, financed them adequately, and gave them exemplary freedom to do what they thought right in the way they wanted. Birt need only sustain that freedom for the creators, and provide it for everybody else, and the BBC will not need to learn management - it will be able to teach it.

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