I find what is happening in the State of Wisconsin right now unsettling. And I don’t mean just the protests and counter-protests. And not simply because the move by the Governor to break the public-sector unions is more a demonstration of political power than a budgetary issue. But because as a management and budgetary matter, it is antediluvian. It represents the worst of industrial era thinking. In a time when most CEO’s at least give lip service to the notion that “our employees are our most valuable assets,” the Governor seems not to have gotten the memo.
Steven Pearlstein makes a good point in his column today (Making sense of Wisconsin’s union showdown:
Back when I was working at Inc. magazine in the mid-1980s, we loved nothing better when approaching a public-sector issue than to ask how the private sector would handle it. Faced with the situation in Wisconsin, we would have called up Tom Peters or Peter Drucker and posed the example of a new chief executive brought in by the shareholders (i.e., the voters) to rescue a company suffering from operating losses (budget deficit) and declining sales (jobs). Invariably, they would have recommended sitting down with employees, explaining the short-and long-term economic challenges and working with them to improve productivity and product quality in a way that benefits both shareholders and employees.
Now compare that with how Wisconsin’s new chief executive handled the situation: Impose an across-the-board pay cut and tell employees neither they nor their representative will ever again have a say in how things will be run or get a pay raise in excess of inflation. A great way to start things off with the staff, don’t you think? Remember that the next time you hear some Republican bellyaching at the Rotary lunch about why government should be run more like a business.
Well, the Governor does seem to be running the state as a business — a 19th Century business. And we have seen how well that works in a service-oriented business in the 21st Century. Remember the story of Circuit City? As a cost cutting measure, Circuit City fired its’ most expensive (read most experienced) workers. Customers left and Circuit City went bankrupt.
So my question is this, will Wisconsin be the Circuit City of the public sector?