Introduction: Plunging in
We didn’t do what our families, or society, expected of us. We quit our jobs with a vague but thrilling plan. We would travel the world, find the pioneers, and learn from them. Then we would share what they shared with us, in the hope that the message is heard. Here’s the message: Work can be fun. Work should be fun.
Conversations with friends, family and colleagues tended to follow the same basic script: “It all sounds wonderful, but how on earth will you make your money?”
Shortly after the notion of Corporate Rebels was born, we handed in our notice, moved into a small apartment and lived together to save costs. For the next couple of months, everything we did, we did from there. We built our website, made plans for our Bucket List trips, read countless books on management, and started living the Corporate Rebels life. We did the research and soon found out that we were not the only ones completely disengaged from work. Studies show that a lack of engagement with employees is a major issue all over the world.
That only 15 percent of all employees are engaged at work is something that should be addressed.
Now that we were convinced that having an engaged workforce is a very good idea, the next step was to find out how it is possible that most organizations still work in ways that create such a huge disengagement problem.
In the 19th century, the world faced major problems in the workplace including staggering inefficiency, a gulf between poor workers and rich bosses, and an epidemic of worker disengagement. The workplace problems created tension. At one point there was a sort of Mexican standoff. This was a hot topic for the thinkers of the time.
Taylor’s book, The Principles of Scientific Management, argues that thinking work should be separated from doing work, with managers tackling the former. Taylor’s theory is known as “the one best way”.
Taylor is followed by a number of other “bureaucrats” including Henri Fayol, a French mining executive who came up with the organization chart; Henry Gantt, an American engineer, creator of the Gantt chart; Max Weber, a German economist, wrote on bureaucracy while Henry Ford introduced his famous assembly line.
We quit our jobs in a quest to make our working lives — and yours — more fun. That’s why we started Corporate Rebels, drafted our Bucket List, and set out to meet our heroes. Remember — there was no checklist for pioneers, no criteria to be ticked off.
From Profit: To Purpose & Values
Chipper Bro, one of Patagonia’s first employees. Patagonia is an American retail company founded in 1973 by fanatical mountaineer Yvon Chouinard.
In his book Bullshit Jobs, anthropologist David Graeber quotes a British study showing that 37 percent of workers feel that their job does not make a useful contribution to society.
“There is a big difference between what science knows and what happens in real life. Even organizations aware of the issue commit another grave mistake: they assume their employees and customers are not that bright.
The Patagonia mission statement. “Build the best products, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.”
“After maternity leave 95 percent of (Patagonia) employees return to work,” one of the mothers tells us, compared to a national average of 64 percent.
Progressives start revolutions, they don’t just make money. They crusade.
Profit is important, of course. It funds the pursuit of purpose, but should be the means, not the end. Profit for a company is like oxygen for a human: necessary to stay alive, but not the reason for living.
Hollands Kroon comprises the towns Anna Paulowna, Wieringen, Wieringermeer, and Niedorp. A group of mayors and aldermen had been working towards change. Hollands Kroon determined to become the smartest municipality in the Netherlands in response to an ever-changing world.
Only when there is a good fit will a candidate go through to the next round when skills become a consideration. There are often two or three selection stages, each with different criteria. Sometimes it is a case study, sometimes role-playing, and sometimes a trial working day.
Spotify, which abides by the motto: “Hire for culture, train for skills”.
The purpose must tick boxes: it must be authentic, honest, fearless and real. The higher purpose must be shared.
The founder of Southwest Airlines, Herb Kelleher, once said: “The business of business is people.”
Are you accomplishing your goals? Employees need to see their own role as part of the bigger picture.
It doesn’t matter how loud your voice is, your actions are all-important. Authenticity and credibility are lost when you fail to follow through.
From Hierarchical Pyramid: To Network of Teams
Zhang Ruimin, Haier’s enigmatic chief executive. Zhang is a friendly 70-year-old, wise and well versed in the ways of business.
According to the study that Hamel and his colleague Michele Zanini carried out, the effects of bureaucracy cost society, in the US alone, some $ 3 trillion every year.
There is a big difference between recognizing a need for change and making it happen.
Research from the University of Nebraska shows that up to 55 million meetings take place in the US every day, and the average employee spends six hours of the week in one of them. It’s even worse for managers, who, on average, spend about 23 hours in meetings each week.
Organizations “waste $ 213 billion (equivalent to California’s fiscal spending plans for 2019) on bad meetings that, very often, only make things worse”.
“The pyramid worked really well during the 1980s and the matrix was excellent in the’ 90s,” Zhang told us, “but early in the millennium we grew so much that the system couldn’t keep up.” It was again time for transformation, but by now change — once feared and avoided — had become an anticipated part of continued progress and even welcomed. Zhang saw that multinationals were experimenting with satellite organizations. In the early 2000s, he decided to follow suit. Haier decided to match supply to demand, and to deliver products only when the market was ready. Zhang took the bold step of working without stock and producing to order. To minimize delivery time, Haier began increasing local production by buying-out foreign brands.
Zhang threw the traditional structure out the window, dividing the company into 2,000 Zi Zhu Jing Ying Ti’s (ZZJYTs). These are self-organizing units, moving away from hierarchical pyramids towards team networks.
Haier is ever evolving, and so is the internet — which fascinates Zhang: “I think that the future will hold only two types of organization: online platforms, and those that rely on them”. That is the philosophy that nudged Haier in a direction it has followed since 2012 in its fifth, and most recent, incarnation. In one major decision, 12,000 middle-management positions were made redundant, and 2,000 ZZJYT became 4,000 micro-enterprises. Haier has even started experimenting with shared ownership, with employees becoming shareholders of the micro-enterprise in which they work. It’s willing to go all the way in the creation of a network of teams and has taken the next step: a network of companies. The success of the new enterprises is around 50 percent. If that doesn’t sound impressive, consider that a mere eight percent of start-ups survive, let alone succeed.
Zhang has a metaphor to explain the 4,000 micro-enterprises. We try to organize ourselves like a rainforest, he says. Eventually, every empire will collapse. A rainforest, on the other hand, will continue.
It is painfully obvious: the system in which many people still work was created for a stable, slow and predictable world that no longer exists.
Swedish firm Svenska Handelsbanken where, in the 1970s, Jan Wallander was at the helm during a crisis. The principles of radical decentralization — even now, decades later — run strong in Handelsbanken.
The centralized decision-making meant that, although the local branches knew their customers, they did not have the authority to take any meaningful decisions.
The local branches had small teams of 10 employees, but together they formed one large network. At the time of writing, Handelsbanken has 800 offices and 12,000 employees; each branch has genuine autonomy. The new model stated that only the branches had the right to decide which products would be offered to their customers. How they would present them, and at what price, was again their decision. The responsibility for staff policies also lay with the local branches.
All branches are compared in terms of cost-to-income ratio. There are also other indicators, such as trends in volumes, customer numbers and audit ratings that branches and regions look at to gauge the development of a healthy business. The goal is constant striving for a better score. This competition is transparent: everyone has access to performance figures.
The network-of-teams structure is just as beneficial in the world of European banking as it is on the vast factory floors of China.
Spotify has guilds, groups of employees who work in different teams but share expertise and interests. They meet on a regular basis, and while most guilds are work-related, some focus on hobbies and leisure.
An inverted pyramid means that employees work pretty much as before but will understand that the organization supports them. This pyramid still has managers making most of the decisions, but they do so believing that they are assisting employees closest to the client, product, or service. Many progressives regard the inverted pyramid as obstructive and inflexible. To counter this they may create small, autonomous teams in certain areas. The logical next step is to split the pyramid into autonomous teams, but for some that’s too much, too soon. An interim solution is to create a flat organization with minimal management layers.
Those that do dare destroy the pyramid, organize themselves in a network that is waited on by a small but efficient “head office”.
The true radicals go one step further: as well as creating the network of mini-organizations by providing part ownership, an online platform is built to give access to stakeholders.
From Directive: To Supportive Leadership
Ari Weinzweig, CEO of Zingerman’s Community of Businesses since 1982. The community comprises nine companies that focus on the food industry.
Opinions were only valued when they originated from the lips of those with the biggest salaries. Those in the trenches were constantly overruled by leaders who had no clue what was going on.
Research tells us that 50 percent of employees quit because of concerns about their manager.
The Zingerman Community of Businesses is heavily influenced by Weinzweig’s interest in anarchy.
Everybody is creative and intelligent by nature, and capable of great things. We must lead by supporting others, not by commanding.
The cost of bad management (in the United States alone) is estimated at $ 310 billion per annum.
We had heard about British broadcasting network UKTV, and its rebellious CEO Darren Childs. Once appointed, he took control and quickly revitalized the old, stiff hierarchy to encourage employees to unleash their creativity. An important part of the change was the creation of a supportive culture.
“We want to dismantle hierarchy by design, and part of this was achieved by fully redecorating the office. We took all managers out of their rooms.’’ Childs tells us about the introduction of weekly “town-hall meetings”. These are a recognized way to share knowledge and information. “I open the box and read aloud whatever it says on the note. Then the leadership team and I try to answer honestly.’’
During the transformation, UKTV made another radical move. This time, it tackled evaluations and reviews. Every member of the team gives the manager a score for certain tasks. And UKTV goes a step further: the results are shared with everyone in the company.
Weinzweig and Childs are progressive leaders running companies in their own authentic way.
Archaic style of leadership isn’t just costing an enormous amount of money, it also leads to dubious work practices. We regularly experienced the HiPPO-effect (Highest-Paid Person’s Opinion).
A fair number of traditional organizations shower privilege and status symbols on the higher ranks: reserved parking spaces, corner offices. These are hangovers from the Industrial Revolution. Maintaining the ivory tower is not just outdated, it is bad for business.
Progressives swap the top-down reward system for a bottom-up model.
Hierarchy itself is not the problem. Artificial hierarchy is. When authority isn’t based on competence or quality of leadership, the result is the dreaded Peter Principle – a concept that has been understood for decades but is still with us. Laurence J Peter’s book describes it well: “In a hierarchy every employee tends to rise to his level of incompetence.”
Of the 100-plus Bucket List organizations we have visited, most have one thing in common: a lack of directive leadership. Instead, we find supportive senior staff that lead by example, who ask their employees the best way to help and support them. They show an admirable combination of authenticity, modesty, rebelliousness and stubbornness. They have a clear vision and inspire their people to action. At the same time, they are available for feedback and criticism. They listen to the ideas of those on the front line. This is Supportive Leadership.
Letting employees choose their own leader is one of the most rebellious solutions.
Swiss IT company Haufe Umantis was the most radical in this regard. All positions of power are democratically chosen-even that of the CEO.
From Plan & Predict: To Experiment & Adapt
New Style of Relationships (in Spanish, Nuevo Estilo de Relaciones, or NER). NER originated in 1991, when Koldo Saratxaga was appointed General Co-ordinator of the Irizar Co-operative. In 2006, Koldo created the K2K Emocionando team to develop and adapt NER for all organizations.
NER is about making people effective and the true centre of organizations – working with absolute transparency, trust, freedom, and responsibility.
At K2K Emocionando Consultancy — we meet Koldo Saratxaga. He is the founder of K2K, which has transformed 70 dysfunctional organizations into progressive and dynamic workplaces.
Change, as they say, is the only constant: today’s world is a very different one to that of just a few decades ago. The result? Organizations have become more complicated. Far from solving the problem of complexity, we worsened it with bureaucracy.
Many companies fall into the trap that Koldo neatly sidestepped. They attempt to predict the future and try to wrest control from chaos. The most painful and frustrating signs of this folly usually come in the annual budgeting rounds. This “managing-by-numbers” ensures little, other than that employees are prompted to take irrational decisions rather than use common sense. Setting budgets and planning can sap an enormous amount of time and energy and cost a lot in financial terms too.
While the foundations of the “agile” movement are sound, and valuable, the way many companies practice it is simply wrong.
The pioneers we’ve visited have moved beyond buzzwords and hype to employ healthy experimentation: new products, revised services, alternative ways to carry out work. Even in highly regulated sectors, they have managed to embrace flexibility and cope with an ever-changing environment.
By implementing a system focused on experimentation, adaptation and freedom, Koldo had created an empowered workforce. The new model provided Irizar with annual growth of around 24 percent — for 14 consecutive years.
Koldo became so frustrated by the never-ending list of excuses that he set out to prove them wrong. He started K2K Emocionando to encourage others. And I had good reason.
Our approach was radical and based on a list of logical principles. We first had to get rid of the old command-and-control mindset. So, from day one, all privileges are eliminated. After removing privileges, the consultants redesign every organization into a network of teams. Once the network is in place, each team elects its own representative. These leaders, however, have no power, and don’t get extra salary. Teams can opt to spread this role across two or more people and replace the leader at any time. The leaders merely co-ordinate and communicate with other teams. We make salary levels transparent, as well as team commitments and results.
K2K also suggests companies hold monthly and quarterly meetings to give a wider understanding of the financial details and of how the business is run.
Nothing stands still for long at Spotify, and 100 new employees are joining every month. Daniel Ek’s tongue-in-cheek motto speaks volumes: “We aim to make mistakes faster than anyone else.”
All successful startups must deal with this, and not all emerge victorious. Growth and chaos often go hand in hand, and some try to manage this by increasing control and bureaucracy. That’s a shame, because the breakthroughs that brought success start to falter.
We are here to get a better picture of Spotify’s way of working. The engineers have formed into squads, tribes and guilds.
The squads working co-operatively on a feature – for example, the music player or backing infrastructure – form what we call a tribe.
To stimulate connections between the groups, we brought in chapters and guilds. Chapters are small groups of specialists from the same tribe that share their expertise. They form close-knit communities and meet for work-related discussions. Guilds stem from a similar rationale, but these are company-wide, and do their business in a more relaxed manner. There are hobby related guilds, from hiking to brewing beer and photography. Every squad has access to coaches who can help develop and improve work methods.
We place more value on innovation than predictability. Prediction can never be innovative.
Some squads have a special Fail Wall to encourage learning from errors. Alongside these Fail Walls, internal blogs share successes and failures to create a culture of improvement, always driven by the employees themselves.
American academic Leon Megginson observed in his 1963 interpretation of Charles Darwin’s central thesis that it is neither the strongest nor the smartest of the species that survives, but the most adaptable.
Businesses that constantly experiment will be the winners. Progressives see this new reality not as a problem but as an exciting challenge. They know that they will never “get there”. In this process of experimentation, speed is essential: rapid change requires rapid response. “Progressives know that success belongs to the fast learner. Spotify embraces this notion.”
Nike had it right all along. When it comes to experimentation the best advice is: just do it. Action is the most powerful antidote to the corporate disease of “analysis paralysis”.
Experiment properly and fail masterfully. Whether you like it or not, the two belong together.
Various pioneers hold regular “Fuck-Up” events. People share their biggest disasters and tell the crowd what they have learned.
Set up a crowdsourcing platform and invite employees to join. Create a bottom-up movement. Large-scale change programmes fail 70 percent of the time.
Go further, give everyone the time they need to rebel. There are many ways to go about this.
From Rules & Control: To Freedom & Trust
“You must visit the man with the funny stories and silly shoes.” Our target is Frank van Massenhove, of the Belgian Ministry of Social Security.
Why is our faith in others so low that we don’t trust our colleagues to take the smallest of decisions? Is writing policy manuals really the best use of company time, when they are unlikely to be read? Do we have to impose strict rules on the masses because of the sins of the few?
Many pioneers agree that only three percent of the workforce is likely to take advantage of the system.
Research consistently shows the benefits of autonomy, freedom, and trust – yet nothing changes.
The ministry now operates in the network-of-teams structure, with the groups evaluating their representative; status symbols are things of the past. Senior management sits at the same table as the others. Ministry staff have complete freedom to design their working day: on average, only six hours – but they are far more productive.
In Europe, we paid our respects to another progressive law firm, Brugging & Van der Velden in Utrecht. BvdV was founded in 2006 and is known for its four-day working week; employees are discouraged from working longer. We met one of the founders, Sjoerd van der Velden. Over lunch, he tells us that he is inspired by the ideas of Brazilian entrepreneur and Bucket List pioneer Ricardo Semler.
The meetings are never chaired by the same person and the participants don’t seek a democratic majority but strive for consensus. Equality is paramount. Everyone is personally responsible for the number of hours they work. We don’t keep track of annual leave.
Freedom and responsibility go hand-in-hand. We work with what we call a break-even point (BEP). Each year, we calculate how many billable hours should be put in to keep the place running. Beyond that point, every hour is profit. Everyone receives a basic salary, but also benefits from hours that exceed the BEP. There is a yearly maximum, equivalent to about 1,128 billable hours (six hours a day, four days a week, 47 weeks a year) that you can make at the firm.
One thing we have learned, is that there is no holy grail, no silver bullet, no one-size-fits-all. The point is that every organization should dare to experiment to gain new insights and see if there is a better way.
The Belgian ministry, Dutch law firm BvdV and VERSA are great examples of progressives that organize themselves according to freedom and trust.
When nobody looks at the hours you work, only results, you must deliver. When control mechanisms go, you can’t hide behind the rules. You will have to use your own judgement. Progressives want you to make full use of your brain and work autonomously.
Empower employees: give them the freedom to design and decorate. It’s a simple way to provide the first level of autonomy.
If you judge employees by results, you should work in a result-orientated manner.
It’s all about being able to evaluate progress. How the employees manage this is their own affair. This results-orientated way of working is a boost for motivation and ensures that employees contribute.
Chuck the time-clock out of a top-floor window, forget fixed working hours, give your employees freedom. If you don’t trust your employees, why did you hire them in the first place? Top-down control and reviews are standard in most traditional companies. Cut it out! It serves nobody. Let workers be accountable to their colleagues not to the boss. The true radicals allow workers the freedom to determine their own pay level.
From Centralized: To Distributed Authority
Towards the end of the 1990s, American Navy submarine commander David Marquet made the decision to give as few orders as possible.
A textbook example of where central decision-making can lead. Employees stop using their common sense and simply await orders. The crew is expected to carry out commands, not question them. This doesn’t apply just to the military.
When putting together a proposal for major clients, signatures had to be collected. The first step was to visit all the managers who had to sign. The questions posed by them weren’t related to content; this was an ass-covering exercise. Responsibility, ownership, and entrepreneurship were irrelevant. Those at the top carried a responsibility for things they knew nothing about.
A good deal of time at work is spent waiting. If all this waiting resulted in great outcomes, it wouldn’t be so bad. But that is not the case.
We often live in the past, with structures and processes that were designed for a world that no longer exists.
Marquet discovered the good and the bad. He soon found out that the old way of getting things done was frustrating. His new approach was in the style of Ari Weinzweig in Ann Arbor, pouring water for the guests in his restaurant: management by wandering around. That’s a term thought-up by American management-guru Tom Peters.
Iceberg of Ignorance. This legend originated (it’s said) in 1989, when consultant Sidney Yoshida produced a study on the leadership habits of Japanese car manufacturer, Calsonic. Yoshida uncovered poor distribution of power and information.
The Iceberg is a fine analogy of the miserable state of the modern workplace. In good times, this situation may not be crucial. But in bad times, leaders need urgent and accurate information to survive.
Marquet said: “We went from one person telling 134 people what to do to 135 people – creative, proactive people – who were actively thinking.” “Don’t move information to authority, move authority to information,’’ he wrote in Turn The Ship Around. “We know what happens when we give people control,” he says. “They participate, becoming passionate and energized. They start using their brains. They come up with ideas.
In traditional organizations, we see two decision-making methods. The first and the most popular is the directive top-down style. At the other end of the spectrum is the consensus method. Both options are familiar and have their pros and cons. Progressives have said goodbye to these stereotypes and adopted alternative strategies. To prevent the walking-through-treacle syndrome, and drowning in sluggish processes based on consensus, many progressives apply another approach: the advice process. There is one qualification: before anyone makes a decision, they must seek appropriate advice. This has to be given by people who will be affected by the decision, and who have relevant experience.
“In 2001,” Stoffel begins, “Hermann Arnold decided to set up Umantis with the goal of fixing the traditional way of working.’’
The concept of crowd wisdom, however, goes back that far. It was Aristotle who found that a big crowd is smarter than a few experts.
We are all familiar with the concept of the wisdom of the crowd without realizing it.
Many progressive organizations continuously adapt to a rapidly changing work environment. They understand that centralized decision-making processes cause the organization to be slow-footed. That is why they often rely on the individuals and teams closest to the front line.
Teams may not know if they’re allowed to take a certain decision. Leaders may struggle to let go of authority. Many solve this with a simple first step. They map the current situation and provide an overview of who does what.
We see the following divisions within many progressive companies:
- Simple decisions: just do it.
- Medium to big decisions: Advice process.
Try to replace passive phrases with ones that imply initiative and ownership. Managers can also change their language. Instead of giving answers, they should be asking questions.
Once it is clear who makes the decisions it’s time to distribute authority down the chain of command.
Henry Stewart, CEO of the British training bureau Happy, introduced us to another interesting idea: pre-approval. A leader or manager approves something in advance, before the employee has made a decision or found a solution. The approval is given on one condition: adhere to the predefined boundaries.
- Someone takes the initiative to solve a problem or grasp an opportunity.
- The decision-maker seeks advice from people directly involved and/or more experienced colleagues.
- This advice can be heeded or ignored. The decision-maker has the final say.
- The decision-maker ensures that all involved are informed about the advice received and the eventual decision.
From Secrecy: To Radical Transparency
We meet Semler in a city centre hotel and learn how he transformed the company not once, but twice, to make it one of the World’s most progressive businesses.
“Just after I took over,” says Ricardo, my dad told me: “I’m going away for the next two or three weeks. Any changes you want should be implemented while I’m gone.” I took up the challenge and made a list of the top 15 managers. It was a Friday; I made appointments, and by the end of the day, half of them had been fired.
He did not immediately go the progressive route. The transformation that followed the sacking spree was all about “professionalising”. Staff were sceptical of this new, authoritarian approach, and the resulting atmosphere knocked Semler’s confidence.
He decided that enough was enough – and hired HR director, Clovis Bojikian. It’s here that the story took a turn for the better. Bojikian and Semler were to play pivotal roles in the creation of one of the world’s most unusual workplaces: Ricardo as visionary owner, Clovis as pragmatic HR director.
Having Bojikian on board facilitated crucial change. To the vision and vigour of Ricardo, he brought experience and pragmatism. They agreed that it was time to stop controlling and regulating everyone and focus on freedom, trust, and openness.
The first item to be addressed was a seemingly trivial one. At its heart is one of Brazil’s most famous dishes — a bean stew called feijoada. The complaining stopped once people had taken ownership of the problem. While the consistency of beans may not seem that important to us, it obviously was to the workers. The episode was a learning experience, a turning point in Semco’s transformation.
Another minor issue had to do with company uniforms. The best thing was that the employees decided. You could feel levels of trust and responsibility rise. People were happy.
Another hot topic was annual leave. Management used to arrange “bridge days”; if there was a public holiday on a Thursday, the company would give employees the Friday off as well, and then compensate for that with a working Saturday later on. This was unpopular. “Deixa com nóis” (Leave it with us), said the third Semco worker’s commission to be created.
Next in the firing line was the rule book. They began to eliminate set procedures, status symbols and privileges.
It became clear that the hierarchical paradigm was affecting motivation. Semler and Bojikian wanted inspiration from companies that had faced similar situations. They sent one of their employees, Joao Vendramin, in search of inspiring organizations. He concluded that the only solution was to dismantle the pyramid and create a network of teams. Factories were split into independent units, small enough that employees were on first-name terms. Joao’s plan was dubbed Amoeba, after the management model Kyocera pioneered. Each amoeba had a maximum of 50 employees and operated independently.
The time was ripe for the next step: the dissemination of information. Weekly meetings were held where no subject was taboo. Keep people in the dark and they tend to assume the worst.
There was more to be done. We decided to change the personnel review process, with employees reviewing managers instead of the other way around.
The next step was obvious. If employees could review their managers, why shouldn’t they select them? And that’s what happened.
Time for some more experimentation, then. Teams were given the freedom to decorate their workplaces, which resulted in colourful factories. And they set their own goals, which became more ambitious – yet more likely to be achieved – than those imposed by management. Flexible working hours become the norm.
At our high point, we had 5,000 people working at Semco and our joint ventures. I thought it was time to go in a different direction. Could a similar way of operating work in a different environment? That is why I now have a consultancy, hotel, and school that were all set up on the same principles. In the 21st century, Ricardo Semler slowly sold off his shares. But, mainly for sentimental reasons, he kept the factory in Itatiba which we had visited, where it had all started for his father.
The dividends of secrecy are distrust, ignorance, gossip, and poor performance.
Radical transparency is vital. We have seen at Semco, and elsewhere, that as trust increases, involvement rises, people take better decisions. All key information should be made public.
Smarkets is one of the few places where self-managing teams, radical transparency and self-set salaries are the norm. Smarkets was founded in 2008 by Jason Trost. It has offices in the UK, America, and Malta. Most of the 120 employees are based in London. Smarkets is all about event betting via a peer-to-peer exchange, where people can wager on outcomes.
Using the same continuous experiment-and-adapt method as at Semco, Smarkets has developed into a workplace that boasts many of the eight trends we value so highly. Its employees (65 percent of whom are engineers) work in self-managing teams.
Some teams select their leader in a democratic way, some rotate the role, and others are leaderless. This is a common feature of true progressives. True progressives share authority. A lot of people move from team to team. This creates transparency and prevents silo-forming.
How do you let people choose their salaries, but not award themselves CEO-sized pay cheques? The answer, once again, is trust and transparency. At Smarkets, everyone can put in a business case for a salary increase. The data include a benchmark against performance, market rates, and peer response. A salary committee of peers views this and provides feedback. After that, it is up to the individual to decide and the proposed salary is made public.
Many progressives use a process like this to resolve conflicts:
- Talk to the person with whom you are in conflict.
- Do things still not work out? Bring in a mediator that you both trust.
- Still nothing? Get yourselves a panel of mediators.
- No joy? Then it will be up to an appointed arbitrator (often the CEO) to force a solution. This is seldom needed.
“First, we trust our colleagues. Second, we have a salary commission that advises you and can apply pressure. But if you were to ignore their advice, there is another mechanism: your new salary will be made public. That is enough: people no longer ask for absurd increases.’’
Radical transparency is an important characteristic of progressives.
- Everyone should be involved in the process.
- Leaders should be communicators. Town hall meetings can benefit from a transparent Q & A session.
- Some progressives make all information public unless there is a very good reason not to.
- Make sure that teams and individual members can compare their performance with that of others.
- Without proper knowledge acquisition, transparency doesn’t mean much.
What happens if salaries are made transparent and people feel they are unfair? Well, a great opportunity arises to fix a problem and nourish trust and commitment.
From Job Descriptions: To Talent & Mastery
We’ve had the pleasure of meeting key Buurtzorg people from all levels, and regularly speak to those who were there from the start, founders Jos de Blok, Ard Leferink, and coach Gertje van Roessel.
Buurtzorg has become one of the largest homecare companies in the Netherlands, with satisfied employees and customers. This is partly due to the goal of delivering “the best care at home”. And all this has been achieved without the need for a management structure.
“You have to let people do their work and allow them to apply their talents,” he says. De Blok has been sharing his wisdom and catchphrases with anyone who will listen.
Just 14 years after Buurtzorg was founded, it has a workforce of 15,000 nurses, spread throughout the Netherlands. It now consists of more than a thousand self-managing teams of up to 12 nurses, responsible for managing their own districts.
Employees are encouraged to discover their own talents and use them. Mastery refers to their continuous development. It’s not about hiding or improving weaknesses. It’s about building on what comes naturally. Discover your strengths, then your preferred tasks – and make these your own.
Pirate captains and quartermasters were elected. All agreed on a constitution which determined how the ship would be run. Loot was shared fairly, if not equally. The captain and quartermaster would take a slightly larger share — one-and-a-half to twice as much as the others.
Captains only held absolute decision-making powers during combat; in times of peace, everyone had a voice. Captains could be, and often were, replaced.
But how was this reflected at Nearsoft? We spoke to several employees and discovered the company’s lack of hierarchy. There is not even a permanent management team. Every five years, long-term goals are defined by all Nearsoftians, as they call themselves.
Whether it’s the quality of the coffee in the vending machine or a revised profit-sharing formula, anything can be brought up for discussion.
Here are five best practices we picked up along the way. As you may expect, we’ll start with the basics and gradually work up to the more rebellious options.
- LEVEL 1 IDENTIFY TALENTS. Many use a simple survey to discover talents and share the results.
- LEVEL 2 JOB CRAFTING BY COMBINING RILES. If you don’t like your current job, there are other possibilities. You can quit, find something new, or simply suck it up and continue suffering. Then, there’s an alternative called job crafting. In the literature, it’s defined as “self-initiated change behavior that employees engage in with the aim to align their jobs with their preferences, motives, and passions”.
- Create a list of all the tasks a team needs to carry out.
- As a team, develop roles from activities that are similar or closely related.
- Now have team members select the roles that appeal to them.
- What do you do with the unappealing tasks? There’s one solution we like: get rid of them! Simply stop assigning these roles.
- LEVEL 3 UNLIMITED TRAINING. Let employees decide how to up-skill. They can be trusted to make the right decisions.
- LEVEL 4 SELF – SELECTED MENTORS. Individuals develop better when surrounded by people they trust.
- LEVEL 5 INTERNAL PROJECT MARKETPLACE. Some of the most progressive organizations have established an “internal marketplace”.
Join the Revolution: Seeing is Believing
Progressive ways of working are always possible. Pioneers have pushed the boundaries way beyond what might have been expected, given their corporate circumstances.
In the end, it’s about finding fellow rebels and pushing hard within your sphere of influence.
Most progressives use a similar methodology.
- PRICIPLE 1: DON’T FORCE CHANGE, INSPIRE IT
- PRICIPLE 2: CONTINUOUS EXPERIMENTATION
- PRICIPLE 3: CREATE A MOVEMENT
Unleash a revolution, making sure that others become just as enthusiastic as the pioneers.
Reflections
With every new phase we enter, our practices evolve. Nothing is fixed, everything can be altered. If it works, good. If it no longer works, we try something new. We are not alone. More companies are searching for new ways to break with the status quo. There are signs that the revolution is truly under way.
