Jimmy Savile and why senior managers are ignorant

At the start of this week I suggested that the BBC may have a recruitment strategy that manages to select the only people in the country too dense to have heard the rumours about Jimmy Savile and underage girls.

Sure enough, Mark Thompson announced shortly afterwards from his lucrative American exile that:

"I never heard of any rumours nor received any complaints or allegations [about Jimmy Savile] while I was director general at the BBC."

But "dense" people don't get to the top of big organisations like the BBC and it is often more useful to look at what is wrong with systems rather than blame individuals.

Because Mark Thompson is not alone. You can see the same pattern in this Daily Mail report:

Stoke Mandeville – a spinal injuries specialist centre in aid of which Savile frequently ran marathons – insisted it had ‘no record’ of complaints about him. 

But a retired NHS worker poured scorn on this claim, telling the Daily Mail: ‘To my knowledge, the juniors and new staff were advised to be careful in their contact with him. 

'That was not said officially, maybe because he brought in such a lot of publicity and funds. There was no control over his comings and goings, he would just turn up. He had free run of the place.

Once again, low-paid staff knew what was going on while highly paid executives were in ignorance.

And really, this should not surprise us. I wrote a post back in February 2009 under the title "Macho management is irrational and inefficient" and I can do no better than quote much of it here:

Chris Dillow, author of Stumbling and Mumbling, asks:

if centrally planned economies are a bad idea, how come centrally planed companies are a good one?

It's a good question.

Much of my political philosophy comes from Karl Popper - or at least from Bryan Magee's explication of his work. And, in his Fontana Modern Masters monograph, Magee writes of Popper:

Because he regards living as first and foremost a process of problem-solving he wants societies that are conducive to problem-solving. And because problem-solving calls for the bold propounding of trial solutions which are then subject to criticism, he wants forms of society which permit of the untrammelled assertion of differing proposals, followed by criticism, followed by the genuine possibility of change in the light of criticism. 

Regardless of any moral considerations (and it is of the highest importance to grasp this) he believes that a society organised on such lines will be more efficient at solving its problems, and therefore more successful at achieving the aims of its members, than if it were organised on other lines. The common notion that the most efficient form of society, in theory at least, would be some form of dictatorship, is on this view utterly mistaken.

Chris argues that the Royal Bank of Scotland was organised like one of these inefficient dictatorships "complete with the suppression of dissent and cult of personality. And look what happened".

An article in The Times from last month shows just how RBS operated:

Prime suspect among the bankers behind the meltdown is Sir Fred Goodwin, former chief executive of Royal Bank of Scotland. Goodwin, nicknamed “Fred the Shred” for his brutal cost-cutting, was an autocratic and fearsomely controlling boss. He even set dress rules for fellow executives that included wearing ties with RBS logos. 

At Goodwin’s “morning prayers”, where he delivered decisions and rarely accepted dissent, he pursued an ambitious expansion strategy.

Or you could try Adam Applegarth at Northern Rock. In his The Crunch (a book I reviewed for Liberal Democrat News) Alex Brummer wrote of Adam Applegarth:

He had a reputation as a martinet who was difficult to challenge. 

An insider said: 'He had an iron grip on the company. Any alternative plan or idea was rejected by those close to him on the basis that "Adam wouldn't like it".' There was no feedback. He surrounded himself with 'yes men' and Northern Rock ended up with people in senior positions who were not fit for purpose. 

The company raced on, brushing aside worries about rising interest rates (which might leave its customers unable to pay their monthly mortgage) and a faltering housing market (which could drop them into negative equity). Applegarth rode roughshod over the bank's board of directors, who lacked the confidence or ability to call a halt to this imprudent expansion.

It follows that the macho view of business propagated in popular television programmes like The Apprentice and Dragons' Den is harmful. Liberals should support the establishment of more cooperative forms of organisation - as indeed we used to do.

And maybe this is true of all centralised organisations, not just "macho management". Simon Carr, the Independent's sketchwriter, once said:

It's not that politicians lie, it's that they don't know if they are telling the truth. They perceive the world through statistics that have been processed by collaborators who are more or less "subconsciously influenced" to manufacture the required facts. Everything from the inflation index to waiting lists is derived from data ontologically perverted by the political process.

And that is equally true of top executives in the BBC and the NHS.