This article presents an exploration of the nature of organizational incompetence both as a social construct and as an "objective" reality. Incompetence is a vitally important but minimally explored variable in organization theory.
The topic of incompetence has been addressed systematically in only a few contexts, and these have limited general applicability to organizations. Anyone desiring to learn about the nature, extensiveness, types, causes, and consequences of this commonly experienced, seemingly ever-present phenomenon will be surprised to discover that the library shelves are virtually absent of serious work in this area. There are three notable exceptions. Military incompetence has received considerable attention from historians and students of strategy. Medical ethicists, attorneys, and advocacy groups have devoted considerable attention to medical-legal incompetence, when individuals' constitutionally guaranteed rights may be stripped from them legally because they are not able to make decisions in their own best interests (Rhea, Ott, and Shafritz, 1988). A third body of literature deals with professional incompetence, the absence of ability, judgment, or morals so total, incurable, and potentially damaging that a professional's right to practice can be terminated. For all practical purposes, however, there is no other identifiable school of inquiry into incompetence.
Further, incompetence just is not what it used to be. Traditionally one person could be fully responsible for a major failure whether in city hall, business, or battle. Although it is still possible to properly credit one individual for a major instance of mission failure, the far more likely explanation is that an organization's structure, culture, or policies are at fault. Still it is far more emotionally satisfying to lay blame on a single individual. Captains were expected to go down with their ships, or at least be the last off. But this attitude does not take into account the nature of modern organizations.
Leaders are no longer lead workers, they are builders and maintainers of organizations. Increasingly they are judged not on their personal qualities of physical courage or intellectual daring, but on whether the organization they head can function effectively - especially without them. You could surely blame a manager if the organization he or she heads fails to perform properly, but your level of analysis rightfully should be the organization.
To be sure, there are always scapegoats to be sought, found, and "punished" publicly. There is something very satisfying about blaming a failure on a symbolic figure. A state experiences a revenue short-fall or a company files for bankruptcy under Chapter 11, and the chief executive immediately becomes a villain to all the laid off workers. A political parry loses an election, and the standard bearer, the head of the ticket, is quickly denounced by the party faithful as a person unworthy of high office in the first place. Before their defeats in commerce, politics, or war these same people were hailed as the best their nation, company, or party could put forth. This phenomenon is so common in so many contexts that it cannot be explained by the chance occurrence of a stupid person inexplicably rising to the top. If the answer is not individual stupidity, how can one explain so much organizational incompetence - so many stupid outcomes (Carey, (1991)?
At least part of the answer lies in separating the stupidity of individuals Welles, 1986; 1988) from organizational incompetence. Genuinely stupid people hardly ever get the chance to be incompetent on behalf of a whole organization. Boards of directors, CEOs, and voters in all cultures seek to weed out the truly stupid for obvious reasons. Because only the best and the brightest are usually allowed to rise to the top, their failures cannot be explained away by stupidity. Very smart people do very dumb things all the time - but this is not organizational incompetence. …