When Bjarte Bogsnes, Chairman of the Beyond Budgeting Round Table, talks about how to create more agile management models, he often uses the metaphor of traffic lights and roundabouts when referring to the budget process.
The main purpose is to illustrate, that we want organisations to be more like using roundabouts, and less like navigating traffic lights.
When people drive up to a roundabout they are required to look at the traffic, make a judgement about when it is appropriate to go and act. By contrast, traffic lights represent rigid rules. They eliminate the decision-making from the drivers; the lights tell them when to stop and when to go. Traffic lights operate without much of the information available to the drivers, such as where the other vehicles are, where they are indicating to go, where pedestrians may be etc.
One of our members came across an article in the Daily Telegraph ranting against the unstoppable march of traffic lights across the UK. He replaced the word traffic lights with budgets and then adapted the associated text to a business context. You can see the result below.
By Rob O’Neill
Budgets [Traffic lights] are meant to make businesses [us] safer, to manage the flow of activities [vehicles], and to prevent surprises [accidents]. Red, amber and green: everyone knows what they stand for. But when budgets were removed [42 lights failed] in Statoil [the town of Beverley], employees [residents] reported that non-productive activities [congestion] vanished and the management[council] said workers [motorists] took extra care.
Businesses [Towns and cities] that have removed superfluous budgets [lights] have found the same thing, with the added bonus of reduced waste [pollution] because of less stop-start activity [driving]. An investigation into a massive new programme in Chicago discovered that, in some areas, the introduction of traffic lights made the streets more dangerous. So why has their use exploded?
You don’t need to be an anarchist to think Britain’s businesses [roads] are over-regulated: Budgets, authority schedules, KPIs, Balanced Scorecards etc. [low emission zones, 20mph limits that cause more casualties than they prevent, endless parking restrictions and bus lanes], and so many pointless rules [signs] that many workers [the Department of Transport] recently called the situation a “national humiliation”.
This regulation isn’t even necessarily designed to serve employees or customers [pedestrians or motorists]. Under new plans, budgets [traffic lights] are [to be] manipulated to give priority to self interested managers [late-running buses], never mind the consequences for customers [commuters] or employees[parents] stuck at red.
We have all of this because business [Britain] is addicted to a “command and control” management [transport] model, one which campaigner Martin Cassini describes as contriving conflict, dictating our behaviour, and depriving us of choice. It runs against human nature, requiring us to suppress certain inclinations – such as to politely support what someone else is trying to achieve [allow someone else through] – as we fight for every inch of personal benefit[road space]. It’s also dangerously distracting, making it more difficult to pay full attention to what is going on and fooling us into thinking our businesses [roads] are safer than they are.
Budgets [Traffic lights] are a big part of the problem. Coinciding with a rise in congestion, there were 25 per cent more of them in 2014 than in 2000, according to the Institute of Economic Affairs, while vehicle traffic rose just 5 per cent. If we scrap many of them, won’t there be anarchy? Not according to pilots in places like Norway’s Statoil and Sweden’s Handelsbank [ Poynton and Portishead], where managers and staff [drivers and pedestrians]have adapted and cooperate rather than compete. As in Beverley, staff [motorists] will often take more care because all determinations of risk rest solely on their shoulders.
Businesses [Councils] are being urged to remove activities [speed bumps] to cut cost [congestion and pollution, so will excessive budgeting [traffic lights] be next?
Don’t count on it. Such clutter has a hidden purpose: to put people off doing their jobs [driving]. The reputation of “shared spaces” has been damaged by thoughtless designs that have left managers [pedestrians] feeling less safe.
The real problem, however, might be us. We’re so used to having our decisions circumscribed by systems designed by others that all too many are terrified of what might happen if responsibility lies more with them.
If we don’t feel we can be trusted with fewer budgets and controls [traffic lights], why should we be trusted working [driving] at all?