How Excessive Rules and Processes Undermine Workplace Collaboration and Efficiency

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Paul Krugman once said that productivity isn’t everything, but in the long run, it’s almost everything. Productivity is the main driver of prosperity in society. Yet in many advanced economies, productivity growth has slowed dramatically over the decades—from 5% in the 1960s to less than 1% today. This slowdown has occurred despite rapid technological innovation, from the internet to new communication tools. When productivity grows at 3% annually, living standards double every generation. At 1%, it takes three generations. This shift means that many people will end up living no better—or even worse—than their parents, losing out on the broader benefits that earlier generations enjoyed. We must understand why productivity is stagnating, despite the tools and technologies at our disposal.

A powerful analogy for workplace efficiency comes from relay races. In elite competitions, winning depends not just on how fast each runner is, but on how effectively the baton is passed. In the corporate context, that baton represents the flow of work and responsibility between people. Cooperation is the miracle that multiplies human energy and intelligence, allowing us to achieve more with less. But when work is broken into rigid segments defined by excessive clarity, accountability, and measurement, it can actually harm cooperation. If everyone focuses solely on their own measurable performance, they may sacrifice opportunities to help others succeed, weakening the overall outcome—just like a relay team losing precious seconds in a poorly executed baton handoff.

The business world has grown more complex, with organizations adding ever more processes, structures, and systems in the name of clarity and accountability. This complexity can create silos, as people pour their attention into what can be measured, at the expense of collaboration and collective success. Excessive reporting and procedural requirements consume vast amounts of time—studies suggest employees in some companies spend 40–80% of their time on internal coordination rather than on value-creating work. The result is lower productivity and disengagement, as individuals focus on protecting their own metrics instead of contributing to shared goals.

To break free from this trap, organizations must design systems where cooperation is in each individual’s self-interest. Leaders must streamline interfaces, reduce unnecessary coordination layers, and ensure that performance measures encourage helping others as much as excelling personally. The goal is not just speed or individual output, but smooth and effective handoffs—the organizational equivalent of a perfect baton pass. Only when structures reward collaboration will productivity rise in a way that benefits the whole company, the economy, and society at large.