Published July 2002

Businesses can learn from FBI reorganization

The Federal Bureau of Investigation is undergoing a major reorganization. Weaknesses in the bureau revealed by the attacks of Sept. 11 have led to sharp, public criticism, and this reorganization is aimed at strengthening the FBI’s capabilities as an anti-terrorist organization.

While there will be some increased hiring — they are looking for about 600 new agents — the reorganization really reflects a significant refocusing and redirection of FBI efforts rather than a simple, “throw money at the problem” budget boost. And while reshuffling a government agency’s priorities rarely provides any management lessons for us in the private sector, this particular one is worth examining closely.

The FBI’s decision to shift its focus from law enforcement to anti-terrorism strikes some people as a “well, duh” type of acknowledgment, but there is actually a lot more to it than that. Most of any anti-terrorism effort is intelligence work, and there is an inherent difference in perspective between law enforcement and intelligence efforts — a difference that, if unrecognized, is significant enough to impair an organization’s effectiveness.

The difference in perspective relates to time. The principal focus of law enforcement is on things that have already happened, crimes that have occurred. By contrast, the principal focus of intelligence work is the future, things that haven’t happened yet.

Obviously, no organization in the real world operates in this kind of pure perspective model. But even though the FBI has done some good intelligence work, and intelligence agencies don’t ignore history, the chasm in perspective is still there. The most common goal of core FBI work is to obtain a conviction. The most common goal of, say, the Central Intelligence Agency is to determine some foreign entity’s intentions and capabilities for mischief.

For the FBI, and law enforcement in general, the past exists as a great field where evidence can be gleaned and harvested as evidence to be presented in court. It is a world where precision and certainty are both cherished and rewarded. In intelligence analysis, the past’s only importance lies in its ability to help predict the future. And it is a world where precision and certainty rarely make an appearance.

In refocusing on anti-terrorism intelligence work, then, the FBI has more than a resource allocation problem. And it has more than a “culture” problem (although there is that, too). From a management standpoint, the bureau will now have to bring together, balance and focus the efforts of organizational elements with radically different perspectives.

Welcome to the real world, FBI. That is exactly what business CEOs do every day.

In business, the Finance and Accounting people are at their best when they are dealing with the past, recording transactions with a precision that supports good decisions about operations. To the Marketing and Sales people, though, the past is unimportant except as a base from which to project and plan future sales.

These aren’t merely competing departments. They have a fundamental difference in perspective, and it is up to the CEO to keep things in balance. It is not a good thing to let the Finance people decide the business strategy, any more than it is a good thing to let the Sales Department run the company.

Differences in time-perspective can cause internal and external friction in an organization if not recognized and dealt with. Friction of this type, for example, may be a factor in explaining why the notorious FBI-CIA antipathy, which had its origins in former FBI Director J. Edgar Hoover’s petulance, persisted so long after his death.

Businesses are tasked with making profits, and it isn’t as easy as it looks.

It involves balancing precise, detailed work on past transactions, famously imprecise estimates of future behavior by consumers, and, of course, your own organization’s capabilities.

To create and sustain an effective organization, the leader, whether it’s a government executive, the CEO of a substantial corporation or a shirtsleeve entrepreneur, has to ensure that the people working in these different areas know how important their perspective is, and how valuable it is to the balanced company.

And this is not something that can be said once a year during performance reviews. It has to be reflected in the leader’s attitude, and in his or her statements and daily conversations — reminding Finance that Sales brings in the money to keep the company alive, and reminding Marketing that only Finance’s precision work can tell them which products are really profitable.

We don’t know yet how the FBI’s reorganization will work out. We do know that we can learn from the bureau as it tries to regain its balance in a changed, and changing, world.

James McCusker, a Bothell economist, educator and small-business consultant, writes “Your Business” in The Herald each Sunday. He can be reached by sending e-mail to otisrep@aol.com.

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