Checks and balances

When a firm is small or just starting up, checks and balances (or peer review) happens naturally through direct and regular communication across the firm. But as a firm grows, the quantum of such direct and regular communication naturally decreases. Checks and balances, peer review, compliance monitoring and such similar activities consequently become more difficult. This necessitates putting in place "systems and processes" to institutionalize the necessary checks and balances. While such processes (often in the form of "watchdogs" from the CEO's or Chairman's office) are viewed as interfering bureaucracy, they are often absolutely necessary in today's corporate world, where trust is rather low.

Now this creates an interesting problem. Imagine an average firm, where the majority of workers put in 8-10 hours of honest effort per day. It is impossible to employ a peer reviewer for each worker. So typically, most large firms will have a dedicated set of people (often the young, highly intelligent, ambitious B-school types, attached to the top boss' office) who are supposed to keep tab on performance and compliance. Since this is usually a small set of people who have to exercise oversight over a much larger set of workers, the amount of time they are able to dedicate to each project and each worker is rather limited. No matter how intelligent and capable they are, it will eventually become impossible for them to provide uniformly high quality and in-depth insights and feedback on all projects and workers across the firm. There will be slip-ups, and one rarely ever forgets or forgives such slip-ups by "watchdogs."

Thus continues the perpetual acrimony and bad blood between those who work and those who are supposed to ensure that work happens.

There is no doubt that in a large organization, there needs to be dedicated people to ensure compliance and peer review. But how can a leader put in place such systems and processes, which are inherently meant to be intrusive, without stepping on the toes and egos of those who deliver the work? Is it possible for a leader to find this balance or must he learn to live with it as a "necessary evil?"