The cost of bureaucracy in software companies

A lot of software companies suffer from the same problem, as they grow they fall into the trap of adding unnecessary bureaucracy. Now I’m not talking about making sure a work environment is safe, or that people are looked after, or that no bullying takes place. Maintaining a healthy workplace needs certain levels of procedures and policies.

However as organizations grow it becomes so easy to to create unnecessary policies, ones that are so tight they kill any sense of autonomy.

Lets take an extreme example of this, lets say one day someone gets caught torrenting files at work. Apart from firing them what else could happen? A policy could be set, firewalls could be turned up to max, teams could be brought in to police things, you could lock the software users have to a standard set. There’s a lot of ways to stop this, but now that one person has ruined things for the future.

Lets look at this mathematically. Lets say you bring in a firewall team, a security team and a compliance team to keep people in check, and lets say some talented developer needs to run a new service on port 8080 (really, that isn’t even an odd port!)

Now a change that would have taken no time suddenly involves 3 new people, each one bringing their own level of efficiency. If each person is 80% efficient, here’s what happens:


Overall Efficiency = 80%


Overall Efficiency = 80% * 80% * 80% * 80% = 40.96%

It gets worse!

That’s right, by adding just 3 people to a decision, working at 80% we’ve managed to reduce overall efficiency by a half!

Now think about decisions in an organization, any modern organization. Think what it would take to change some text on a production website, or feeding back on requirements. As companies grow they bring in various departments and every single point requires more people to discuss.

Even the best of people, working at 90% can get stumped by this. Even at that pace a decision that needs 6 other people means you run at 47%.

With people working at 50% that could fall to 7% overall, essentially grinding progress to a halt


There are levels of bureaucracy that are necessary, but I fail to see how so many organizations fail to understand the most basic notions of how important to individuals and themselves autonomy really is.

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