What Does the Queen Do?

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Just a few years ago, few would have predicted such an outcome. That republicanism has no political traction after a period when many Windsors acted less as exemplars than as reality-TV stars is due largely to the Queen. She may be remote, but her dedication to duty gets widespread respect. It could hardly be otherwise. Since 1952, she has received more than 3 million letters, hosted around 1.1 million guests at her garden parties, and made 256 official overseas visits to 129 countries. Asked to explain his mother's relationship with the country, Prince Andrew says: "It's slightly complicated for people to grasp the idea of a head of state in human form, but I would put her appeal down to consistency. In their eyes, she's never let them down."

Still, the battering the Windsors took in the 1990s, especially the emotional gusts during the week after Diana's death when the Queen seemed to be a stonyhearted defender of a hollow status quo, has left the family permanently on guard. According to the Ipsos MORI poll, 81% think Britain will have a monarchy in 10 years, but only 32% think it will in 50. Says one of her senior aides: "One can never be complacent."

Walk around Buckingham Palace — a combination of family home, hotel for foreign dignitaries, stage set for national ceremony, rambling office complex and art museum that reflects the Queen's jumble of roles — and complacency feels far away. If you think of the palace as Monarchy Inc. and compare its operations to a decade ago, the production line has been thoroughly overhauled — a process begun before Diana's death but accelerated in its wake. "People who view us as a Victorian institution aren't looking beyond the front of the building," says David Walker, an air vice marshal who is now master of the household, responsible for all public and private entertainment. In 2000 the palace didn't have e-mail. Now it has a full-fledged secure network and a snazzy website with an intranet under development. Staff can get BlackBerries.

The average age of courtiers has gone down; their professional qualifications have gone up. Instead of being filled by discreet inquiries at a gentleman's club, the latest assistant private secretary's post was publicly advertised, and attracted over 400 applications. It went to an experienced financier. Focus groups probe whether staff are happy in their jobs; salaries have increased; there are "team away days" and rotations of staff to and from government departments and private industry, from which increasing numbers of senior managers are now drawn. "I think people expect we're very traditional and hierarchical," says Elisabeth Hunka, the human resources chief, who arrived at the palace from the clothing industry — "red carpets, long corridors. But there are a lot of highly able people here and a lot of humor, and it creates a buzz. It's a surprisingly democratic organization, because people pitch in. And the Queen sets a very good example. She's very hardworking and never seen to have airs and graces."

A crucial element of the overhaul has been financial. The palace now directly spends a lot of the money that different government departments used to spend on its behalf, which has allowed it to take control over its own operations, establish budgets and cut costs that might otherwise have continued on autopilot. (One example: the certificates people receive when they obtain honors are now generated by computer rather than calligrapher, saving $27 approximately 5,000 times a year.) There's more public disclosure too, in particular an annual financial report launched at a press conference and published on the Web. Last year the monarchy spent $64 million of public money (2.3% less than the previous year, adjusted for inflation) to fund its activities on behalf of the state, such as royal visits, the upkeep of palaces and official entertainment — the cost, as the palace is now media-savvy enough to stress, of a loaf of bread per citizen. Alan Reid, the former chief operating officer of the accounting and consulting firm KPMG who now serves as keeper of the privy purse, says the goal is "not a cheap monarchy, but a value-for-money monarchy." The Queen's natural frugality (except for her racehorses) is well known: footmen at the palace are told to avoid the center of the hallways to preserve the carpets, and she reminds people to turn off lights. Apart from Prince Charles, whose Duchy of Cornwall estate funds his private and official duties, and Prince Philip, she supports the other royals using her own money. Walker says, "If you look at the number of people and amount of expenditure supporting the head-of-state function, it's much, much cheaper than virtually any comparable country."

To be sure, there is still criticism of the special breaks royals receive. As part of the deal that saw her start paying income tax in 1993, the Queen arranged inheritance-tax exemptions for what she received from her mother, and what she will bequeath to Charles. But disclosure has usefully illuminated the distinction between her personal wealth and the Crown's. She used to be commonly described as Britain's richest person, with a fortune estimated at $7.6 billion by the Sunday Times Rich List in 1993, but last year's list pegs it at $507 million, making her 180th.

What a politician might call "image management" has been spruced up, too. Since 2000, the palace has commissioned annual polls and focus groups to assess how people feel about the monarchy. A research department weighs what kind of trips and events will have the most impact. Press aides labor to plan backdrops so the cameras will take away an image that reinforces the message their boss is trying to highlight that day. A press office whose chief used to be known on Fleet Street as "the abominable no man" now promptly returns phone calls. The Queen's Christmas broadcast no longer has her staring straight into the camera, but uses video clips to illustrate her points. Her Majesty even carries a cell phone inside that handbag. All in all, Prince Andrew says, "I think this organization is very good at change management. We live it, we work it all the time. Change is an almost continuous process" — so much so, "that it's almost imperceptible."

That "imperceptible change" is exactly the sweet spot the Queen is trying to hit, says a senior adviser. Moving glacially, of course, can accentuate the sense that she is out of date. But by background as well as policy, that's the way she wants it. Her "Uncle David," King Edward VIII, loved making waves before he abdicated in 1936, and spooked his successors about playing the reformer too overtly. "No gimmicks!" the Queen has told aides. "I am not an actress!" She wants the monarchy to be a focus for continuity and enduring patriotic values, which make instinctive sense to her. She was never a rebel: she venerated her father, a shy man with a stutter who was thrust into kingship by the abdication but mastered his task through hard work. During her wartime adolescence, the idea of obedience and doing one's duty for the greater good was the norm. She really meant it when she said at age 21 that "my whole life, whether it be long or short, shall be devoted to your service," and has not changed her core old-fashioned values. But for the monarchy as an institution, she is averse to risk, not to change itself; she knows staying still has its risks, too.