Story by Mariana Desidéria (Exame) – Interview with Professor Vicente Falconi, founding partner of FALCONI
EXAME.com – What ought to be the first measures Dilma has to take in terms of management during her second term in office?
Vicente Falconi – If I were by her side providing her with advice, I would advise her to start devising a strategic planning for the country. There are some countries in the world, such as South Korea, who make plans for the next 60 years.
But someone can argue that this is impossible, as things change. If we deem impossible to make plans for the next 60 years, let us then make plans for the next 20 years instead. However, we must think of the future and we have to run numbers.
For instance: if we wish to grow 3% a year, what does this require in terms of energy? How much do I have to invest? What does this require from ports in terms of infrastructure? How will exports be dealt with? A framework must be in place, something that serves a guide for public management so that it can make decisions.
EXAME.com – How can this planning be devised?
Falconi – This could only be possible if there were an organization that took care of this strategic plan for the country. So what I suggest is this: structurally set up a public organization that would be in charge of this strategic plan on a national level. Basically, it would be an organization in charge of running numbers. And this organization would require a budget of its own in order to hire the best specialists in Brazil.
A strategic plan formulation means looking ahead into the future, so that we can organize and prepare ourselves in a better way. The alternative would be to run the country at chance and influenced by all sorts of events – crisis over here, crisis over there, a major power outage somewhere else. No one can put up with this, it’s very stressful.
EXAME.com – What other measures would be important?
Falconi – There are several. For example, the Government of the State of Rio de Janeiro hired us to make changes in the education segment. One of things we realized is that the Rio de Janeiro State Department of Education had over 100,000 employees, but it had no Department of Human Resources. Any company in Brazil with at least 500 workers has an HR department.
Then we found out the government employees mix up the HR department and the Payroll department. These are two completely different things. We asked the Government to set up an HR department, which would be in charge of education and training, assessment of performance, recruiting and selection. It would be in charge of managing people; The Government agreed to this and set up an HR department. In three years, the State of Rio de Janeiro moved from second-to-last to fourth place in the country’s education ranking.
EXAME.com – Could this be applied to the federal government?
Falconi – I would suggest to the President the creation of a national HR department and the generation of a career plan for all employees, instead of just for some. There is a career plan implemented at the Federal Police, and one at the Brazilian IRS as well. But if you look at other areas of the federal government, there is no career plans implemented. We need to strengthen public office positions and careers. The Brazilian State machinery is made up by our public servants, and we must acknowledge and honor them.
EXAME.com – Is there a good example in the federal government nowadays?
Falconi – There are several areas of the Federal and State governments with very good examples. The Federal Police has experienced outstanding improvements after former President Lula appointed Márcio Thomaz Bastos to work there. He structured the organization in such a way that nowadays we can see the results.
I was there, as the Federal Police was one of our clients, and it is truly remarkable. I am proud to see a well-organized entity with people and young professionals who believe in it. It’s really beautiful to see.
Then why can’t this be with the entire government structure? The government machinery can work perfectly, as long as it is properly acknowledged and honored. We must set up a proper structure for careers throughout the federal government and equal salaries according to difficulty levels, as there are too many discrepancies in terms of pay. We have to carry out a massive organization effort, which is why an HD department is required.
EXAME.com – In addition to an HR department, what other measures would assist in acknowledging and honoring these servants?
Falconi – In Brazil, we have a vice that dates back to several previous administrations, a national vice that is not limited to a given party, which is the fact that we have 22,000 commissioned posts. In the United States, there are 200.
This is a danger to the State machinery. One way to acknowledge and honor the servants that make up this State machinery is to recruit, train, educate and honor our servants the best way possible, and make the advance in their careers, instead of appointing people who are not from the segment, politicians. This does not make any sense.
My suggestion, given the political limitations we have, is the reduction of this huge amount of commissioned posts. This could be preferably achieved by means of a law that would limit this number to 500, for example. I believe this to be another harmful element for our country.
EXAME.com – These suggestions you make are not especially directed at the situation of President Dilma Rousseff’s administration. These are problems that have been around for decades.
Falconi – Indeed, but someone ought to start fixing this.
EXAME.com – Taking into account the country’s current and political situation, do you believe the federal government needs an “management shock treatment”?
Falconi – There is a lot of nonsense behind this expression, a lot of political disputes, and I don’t like it at all. What everyone needs, both companied and governments – whether Federal, State of Municipal governments, is good management. Management. People need to understand what this means for starters, as most people do not know what it means.
EXAME.com – In practical terms, what is management?
Falconi – Management is simple. It’s setting a dream, and thinking “to where do I want to lead my country?”. From this point onwards, you can devise a strategic plan, set goals, create action plans, work hard, implement plans, obtain results, take the operational machinery and delineate processes, standardize, train people. All this is management, but little to none of this is actually done. There is no need for a shock! Management is what is needed.
Politicians must quarrel among themselves in order to decide to where the country will go. On the other hand, technical professionals do not like this. They like to work, regardless of who they work for. Management has no ideology. Any dominating ideology must set goals, have an action plan, standardize procedures, and strengthen the public machinery.
EXAME.com – Were you invited to work alongside with the government in matters related to management?
Falconi – During President Dilma’s first term in office, I was invited to work with Jorge Gerdau, as well as other consultancy companies were. But the feeling I had was the priority expressed by the President did not disseminate throughout the entire machine. It did not disseminate with the same intensity that she believes, and then this reaches the press and things become even more distorted, you know?
When I talk about strengthening the public machinery, I mean to make sure that these views and orientations can be disseminated more efficiently. The President told me that she wanted to work with basic health care units, and then we devised a proposal for actions at basic health care units and hospitals. We made a proposal and sent it over to the Ministry of Health. However, they did not approve it.
EXAME.com – Do you believe that this is a characteristic that is specific to this government?
Falconi – Regardless of the party or the person who is running the country, the things that are priorities for the President is not always disseminated in a uniform way throughout the public machinery. The same thing happened during the Lula administration. We realized that there was an increasing difficulty the further down you go on the public machinery pyramid. I don’t know if this happens because the public machinery is weak. I really don’t know why. However, I was very saddened by this episode with the Ministry of Health. This particularly affected me.
EXAME.com – And during Dilma’s second term in office, have there been any conversations between the two of you?
Falconi – No. However, I really wish there had been.
EXAME.com – You criticized commissioned posts. What is the problem behind them?
Falconi – Let us make a comparison with companies. When a young professional joins a company, they are interested in growing. They want to learn more and evolve. In the government, people wish to become ministers or secretary-general of a given Ministry.
When you place 22,000 people right on top – political appointments, cousins, uncle/aunts of politicians – you dishonor the public machinery, and you dishonor all the efforts made by public servants. The machinery is left without a strong culture, without a destination and commitment from others. There are no personal cooperation efforts because there is a lack of trust, as no one knows from where this commissioned person came. It’s a very sad thing.
I am always against hiring people who are not originally part of the machinery. I prefer promote people who are already in. Because when you hire people who are originally part of the machinery, you give out a message to the public machinery, saying: “You are all incompetent, and that is why I had to bring someone who was not part of the machinery”. It is a slap in the face. And then we complain about the bad situation of our education, health care and safety.
EXAME.com – Now thinking about public servants and employees who have been approved in a public examination. How to stimulate these people to become more efficient?
Falconi – You don’t need to stimulate no one to be efficient. We already arrive somewhere and people are unmotivated, and we see that continue. Human beings are all alike. You don’t have public-servant-type human beings and private-company-type human beings. People have the same needs, in that they all wish to be respected, they wish to have their work acknowledged and be satisfied when they reach a goal.
And then we have the public machinery, where people are disrespected, you fill positions with politicians or their relatives… And then you wish public servants to stay inspired? You don’t provide them with training, you don’t take care of their development and you still want them to be productive? Frankly, this is completely insensitive. I don’t agree when someone says public servants are unproductive or inefficient. I don’t agree with that at all. They are raw materials that are as good as the materials in multinational companies.
EXAME.com – Another element that is always brought up is the need to cut costs. Are there a lot of resources wasted in public management?
Falconi – Look, costs are one thing, and waste is another thing. There are costs that even need increasing, let’s not fool ourselves. When we propose reducing costs, this means eliminating waste.
Waste comes in all shapes and sizes, more than you can imagine. For instance: you will import a drug to be distributed to the basic health unit network. However, the purchasing process is takes very long. Afterwards, customs will take too long to clear the drug. Then it goes to a warehouse, and distribution takes too long as well. Then distribution goes wrong: instead of sending 500 units to a hospital, 5,000 are sent. And at certain places, the drug arrives and its due date has already expired. Waste is imbued in many areas and instances.
EXAME.com – So cutting costs does not mean jeopardizing social programs and public policies?
Falconi – No; this can only mean improvements to public policies. Because you can even increase costs that are used for good purposes. With companies, the same applies. For example, you have marketing costs. You must not eliminate such costs. Because your sales will decrease if you do. These are costs that are well applied.
During the work we carried out for the Government of the State of Rio de Janeiro in education, the first thing we did was reducing waste. In one year, only at the Department of Education, we avoided the waste of BRL 17 million. Where did that money go? To teachers. We created several small-sized programs in order to improve teachers’ lives. BRL 170 million is a lot of money, and all this money was thrown out the window. We redirected this money, and the routine of the Department of Education did not suffer because of it.
EXAME.com – You spoke about the matter of employees’ self-esteem. What can be done to recover the self-esteem of employees from a company involved in several scandals, such as Petrobras?
Falconi – I’d rather not answer this question. It’s a hot topic, something that is part of the political world, a sensitive subject.
I will say this, though: I have an enormous respect for Petrobras, I know several people there, I have provided services there in the last 30 years and I am very proud of that. It’s a company that set up a complex process and overcame challenges. They found 252 difficulties and set up 252 projects, and overcame all these difficulties. They reached 1,500 meters with drilling, and then drilled even further. They reached the pre-salt fields, which are 7,000 m deep.
It is an outstanding company. I bet that there are people who are seriously angry when they find out about a case of corruption. Because people are proud of the company they work at. I have a lot of friends there and I worry about them, and they must be very upset with everything that’s been going on. This is not good for the company and not for the country as well.
Text published on 1/9/2015 by Exame.com.