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The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.
By Jerry Newfarmer
February 26, 2016
Last year was a great year for films. Two of the best – by my own estimation and that of the Academy of Motion Picture Arts and Sciences – are “Spotlight” and “The Big Short.” “Spotlight” tells the story of the Boston Globe investigation into the priest sex-abuse scandal in the Catholic Archdiocese of Boston, while “The Big Short” follows several hedge-fund managers who foresaw the 2008 financial meltdown and invested accordingly.
The two films reveal much about the nature of both people and institutions that is especially relevant to the work we do in local government. In both cases, people in insular institutions are able to convince themselves their behavior is acceptable and they resist any opportunity for oversight and transparency. They effectively make the case for having outside eyes – whether hiring externally or asking a third party for input and review – to ensure the organizations we run are on the right track.
In the case of “Spotlight,” while news outlets had covered individual stories about abusive priests, no one had ever connected the dots to unveil the full extent of the problem and the role leaders played in covering it up. Responsibility for the crisis lies primarily with Catholic officials who convince themselves that a cover-up is acceptable and justify their actions by pointing to all the good work the Catholic Church carries out. But the newspaper also neglects its watchdog responsibility because many of the editors and reporters share an insider’s perspective. They view the primary victims’ advocate as unreliable because newsroom lore has always considered him so and they think that by writing about individual cases, they have given the issue sufficient attention. Then a new editor arrives. Everyone is suspicious of him because he’s not from Boston and not even Catholic. He’s the one who notices that the problem appears to be bigger than anyone realizes.
In “The Big Short,” Wall Street banks figure out ingenious ways to make money on mortgages extended to people who can’t really afford them and are in over their heads. We know how the story ends. But it helps to go back in the film to a time when it seemed like the housing boom would go on forever and no one would ever lose money invested in real estate. Because there’s so much money being made, it’s hard for anyone to look at the situation with a skeptical eye and point out the obvious risks. Michael Burry, a quirky hedge-fund manager, crunches the data and sees the inevitable end to the good times, but no one will believe him. It isn’t until the cracks in the system give way to its near-collapse that Burry and a small group of contrarians are vindicated.
There are many ways to interpret both of these movies, but one way is to see how important it is to seek fresh eyes and outside counsel on a regular basis. The Volkswagen scandal is another example in which groups of people managed to convince themselves that what they are doing is acceptable when, if they had to explain it to a newcomer, it would be obvious that it is not. Most organizations are at risk for insularity. Local governments are especially vulnerable because people tend to stay in the organizations a long time.
When we perform an organization review, we are applying best practices to the work done to identify opportunities for improvement – just like a physical exam. We often find processes and policies in place for no good reason other than, “We’ve always done it this way.” We sometimes find two people or two departments whose efforts have overlapped or are redundant but no one has noticed because there has been no recent review. Practices that were put in place as a “work around” because of someone’s personality are another common problem.
There are other ways to gain a fresh look at your organization. Talking regularly with peers and mentors outside the organization can provide a new perspective. While rewarding loyalty to the institution is important, hiring from the outside (outside your organization and even the industry) at least some of the time can prompt everyone to look at what they do in a new way. Even cross-departmental teams can invite feedback and new ideas. It’s also a good idea to review policies from time to time to ensure there’s enough oversight and accountability built into the system.
If you haven’t seen either movie, both are worth two hours of your time. They’re entertaining and informative – and they may just help you look at your organization in a new way.
Author: Jerry Newfarmer served as city manager in Fresno and San Jose, Calif., as well as Cincinnati, Ohio. Newfarmer is founder and president of Management Partners, which helps local governments improve their operations.