Company culture: an open and shut model

May 20, 2016 by lsmit@wemanity.com in Blog

There are nine and sixty ways of constructing tribal lays,
And every single one of them is right!

How many ways can you categorise the ways that different startups organise themselves, the different flavours and colours of organisational culture adopted by companies through their life (and death). Far more than nine and sixty, I assure you. And, yes, each of them is right. Models of the world are usually helpful in making sense of the continuous chaos of reality.

I’d like to propose a very simple and useful model for startup (and, more widely, company) cultures, that I feel is relevant at this point in history: open and closed.

hierarchical-pyramid

Closed cultures

There are a number of ways to run a closed culture, but the presence of any of the following features is usually a clear sign of an at least partially closed culture:

– Secrecy by default: Business information is closed by default, on a need-to-know basis. Typically, only the senior management team has access to all the information (e.g. salaries and bonuses, detailed financials of the organisation, etc). These multi-layered secrets often form part and parcel of the power structure: the higher you are, the more information you have access to.

– Top-down, hierarchical management: This can be implemented with varying degrees of flexibility, but the common element is the idea that you have a boss and you should do what they tell you. All closed cultures enable some elements of push-back from those savvy enough to know how to make their points from below, but the general mode of functioning is from the top to the bottom.

– The Pyramid/Career Ladder: Closed organisations are without fail mapped out as pyramid-shaped: there is one CEO at the top, with a senior executive team below, and progressively wider layers as you go down. This Pyramid also provides the Career Ladder – the ever-receding MacGuffin that motivates people to work hard so they can one day get on top of the Pyramid and finally achieve true Success.

– Focus on profit: The more advanced closed organisations tend to focus on profit above all. This is measured as a number and is the primary driver of decision-making. If an action results in more profit, it’s worth doing. If the company makes more profit, it is more successful. Profit is the essential driver of all decisions. “How will it affect the bottom line?” is the main (or perhaps even only) question being asked.

– Motivational measurements and individual incentives: Closed organisations, as they mature, learn to apply measurements as a method of ensuring performance. They will measure everything that can be measure and make up targets and projections (with varying degrees of involvement from those being measured), then hold people accountable to those estimates. Those who meet their targets are rewarded, and those who fail are punished.

– Fixed roles and masks: In closed cultures, you are hired for a specific role. You can progress towards more managerial responsibilities through promotion, but typically, doing things outside of your role is discouraged (if only because it will step on the toes of the person who currently owns that role). In closed organisations you are your role. It’s no surprise, then, that most people put on a mask to go to work: while they are at the office, they are no longer a full person with a variety of wants and activities and aspirations, but a “Web Developer” or a “Marketing Manager”. Professional behaviour is all that’s accepted, and it’s all that’s given.

– Distrust and control: A fundamental assumption of closed cultures is that people are lazy and cannot be trusted, so they need to be controlled, otherwise they will not do any work. This gives even more justification to adding more measurements and narrowly defining roles and performance criteria. When they don’t treat them like mindless cogs in a machine, closed cultures tend to treat employees like irresponsible children.

There are countless examples of closed cultures: most of the companies and organisations in the world are run on the closed model. In fact, in many countries it is illegal to run a public company in an open way . You’ve most likely worked for a closed company at some point in your life. In fact, chances are you’re working in one right now.

Whilst closed cultures (which form the majority of business cultures today) are clearly capable of delivering great results, they have a number of deadly flaws, which I’ll cover in more detail in a later article. For now, let’s look at open cultures.

Open cultures

If there are many ways to run a closed culture, there are even more ways to run an open one. Each open company tends to have its own way of expressing its culture. However, these are some typical commonalities by which to recognise an open culture:

– Transparency by default: In open cultures, business information is publicly available to all employees. This includes salaries, but also bad news, strategic plans, problems, decisions, ideas, etc. People are trusted to be able to handle that information.

– Flat hierarchy and/or self-management: If everyone knows everything and you’ve hired smart people in the right kinds of jobs, it is very difficult to maintain an arbitrary hierarchy, since everyone can contribute to any decision. When you trust people, it is also unnecessary to set up managers whose job it is to check after them.

– Personal development through work: When there is no career ladder, how do people achieve career progression? The obvious solution is that they take on more responsibilities without having to go “up” an arbitrary ladder. As a natural consequence of that, it is possible for people to fully express themselves in their work, by getting involved in their full range of interests, so they can achieve more personal development than they would in a narrow role with a career ladder.

– Multiple stakeholders, values, and purpose: In open organisations, the idea of valuing profit above all others becomes obviously absurd. It’s not only shareholders, but also employees, suppliers, customers, society, and the environment, which matter. The company does not exist in a vacuum. Values become a way to express what the company cares about, rather just a motivational slogan. Along with the higher purpose of the company, they become the way that decisions get made in open cultures.

– Team or company incentives: There is a progression from the closed culture approach of individual incentives, via team incentives, towards the eventual ideal, which is a system where base pay is determined by a combination of what the person is contributing, what the person needs, and what the company can afford, along with company-wide bonuses. Individual incentives are shunned.

– Self-determined pay: One of the surefire signs of an open culture is when people determine their own pay. In most companies, this is unthinkable. In open cultures, it becomes a natural consequence of all the other stuff. After all, if you trust people to make all sorts of important decisions about the company, why not trust them to make this decision too?

– Separation of role and person: The idea that a person and their role are intrinsically bound becomes visibly stupid as the culture opens up. Eventually, it is clear that people are not their roles, but are capable of engaging in several roles simultaneously, contributing more fully to the organisation’s needs. This further enables people to accomplish themselves and to be fully themselves at work instead of wearing masks. One of the ways this is accomplished is through Open Allocation.

– Trust: Perhaps most important is the fact that open cultures treat employees like adults, trusting them to do the right thing even in complex or ambiguous situations. There are of course processes to help people make better decisions, but the key point is that all these processes start from a perspective of trust and responsibility.

The benefits of running companies this way ought to be obvious, but in case they need to be spelled out:

– People in open cultures are more engaged, happier, more creative, they contribute more, etc. This makes them much more fun to work in, both as a founder and as an employee, but also much more productive – people work much more effectively when they care.

– Having a better environment makes it easier to hire great people.

– Open cultures are way more adaptable to change. Change management is an oxymoron in an open culture: change happens constantly and continually, not through expensive, long-winded, and often failure-prone change processes.

– Because they motivate people so much better, open cultures are, ironically, also better at achieving sustainable, long-term financial results.

There are some examples of open cultures out there, too, to varying degrees.GrantTree, Buffer, Valve and Github, in the startup space, are known examples of open cultures. Others include Semco, Burtzorg, Happy Startup, MorningStar, and many others in all sorts of different contexts and sizes. All companies could adopt an open culture, but most don’t. Why is that?

Reinventing Organisations, by Frederic Laloux, studies a dozen or so open cultures and comes to the conclusion that two things are absolutely prerequisite for an open culture to exist for any length of time: both the CEO/Leader and the owners must be fully supportive of this (currently) unconventional way of operating. Otherwise, eventually the company hits a hard time, and either the CEO or the owners pressure it into returning to a more traditional (i.e. closed) mode of functioning. So the obvious reason why more companies are not currently open is because most CEOs are not prepared to let go of their control mindset, and when they are, the owners (whether private owners or VCs with board seats and a traditional, closed mindset, or simply public markets) frequently won’t let them.

If you’re a founder of a startup, this poses an interesting challenge: are you up to the challenge of creating an open culture in your business? Even when that involves giving up the trappings of power? Even when that involves passing on an investment round from an investor whom you know will force the company to change its ways when it hits a rough patch?

If so, welcome to the club. Follow this blog, and I’ll do my best to share what I’ve learned in transforming GrantTree to be an open company. This is still a new field so we can all learn from each other.

By: Daniel Tenner from GrantTree

Company culture: an open and shut model

Remote Work: Stories of People and Teams Doing Great Things

Apr 29, 2016

Get ready to pack up your laptop and hit the road!

Today, I specialise in facilitating remote work. And it was an experience ten years ago that turned a light bulb on for me — in a way I would have never expected.

I was living in California at the time and belonged to a social community interested in the future, technology, and staying healthy. Every Sunday, we’d meet up for a hike together. One member of the group was particularly interesting to me because he was working on a startup idea I’d never encountered before: he wanted to eradicate death.

To the outside world, it appeared that he was building an online project management tool. That was a very “normal” startup idea, even for ten years ago. But what most people didn’t know was that he was building the tool so that longevity scientists from all over the world could collaborate and solve the “problem” of aging.

He had found that the best people needed for this unusual collaboration were not living in the same place. So his vision was to build a tool that they could use to work together remotely.

It was a true “aha experience” for me. Once we remove the issue of being geographically dispersed, we can gather the best, most enthusiastic people together virtually to work on the most challenging problems imaginable.

I was hooked by the concept and started interviewing people and companies working remotely to see what they were doing. Down the rabbit hole I went!

In the past, we had to go to a specific geographic place in order to access the information we needed for our work. Now, that information is likely accessible from anywhere. And this gives us the opportunity to play with new ways of working and new business models.

I’m increasingly seeing a move from a model of work-life balance, which assumes that work and life shouldn’t overlap or blend, to work-life fusion, where the lines between work and life blur.

Work and Life: No Longer at Odds

Jeffry Hesse is an agile coach working with a distributed development team of approximately 40 people at a company called Sonatype. He loves his work. He also loves mountain climbing, photography, and spending time with his grandmother.

Because he can work from anywhere, Jeffry combines his passions by working while traveling. He started by trying an experiment with his remote team. He spent one month traveling in Argentina — and didn’t tell his colleagues he would be on the road.

He wanted to test how productive he could be while traveling, and if anyone on the team would notice.

Admittedly, it was hard. Finding a decent internet connection in Argentina was one of the most challenging aspects. He tried coworking spaces and staying with friends — and his technical know-how came in very handy while experimenting with various VOIP phones. But while it was hard work, and sometimes shaky, he managed to get his work done without the distributed team noticing that he was on the road.

While being a digital nomad may seem like a radically unconventional way of working compared to the traditional 9 to 5 job, it gives us a glimpse into what’s becoming possible…and increasingly common.

What Does It Mean Today to Be “Present”?

The tools that allow us to work in new ways are developing at breakneck speed. One of the most exciting examples of this is telepresence. Telepresence is a combination of technologies that give you presence somewhere other than your actual location. Your smartphone and standard video conferencing tools — even Facetime — can all be considered forms of telepresence.

My favorite form of telepresence? Robots.

The Revolve Robotics Kubi, for example, allows someone to call in (via video conferencing) to any tablet device. The difference is that you can move the tablet from side-to-side and up and down and control where you are looking from your own laptop.

For instance, if you are a remote participant at a meeting where everyone else is sitting together in a room, you can turn yourself to see who is talking. Other telepresence robots allow you to beam in to what is basically a tablet on wheels, and drive yourself around using the arrow keys of your keyboard. Schools use these for kids who can’t attend classes in person. Museums use these to give remote tours. Even doctors use them when specialists are scarce.

These interactive sensory experiences bring us closer to replicating what it’s like to be together in the same room. And the technology gets better and less expensive every year, opening new options all the time. Holograms are just around the corner!

How Businesses Are Changing

Because of these new technologies, more and more people are like Jeffry, seeking to balance their work with the freedom to pursue their passions. What it means to actually “be at work” is changing rapidly — businesses are evolving as well. Here are three examples:

A Virtual Network With Global Impact

Happy Melly is a social entrepreneurship network of individuals and small businesses dedicated to happiness at work. Supporters include coaches, creatives, authors, speakers, managers, and entrepreneurs. Members of Happy Melly help amplify and globalise great business ideas through virtual and in-person workshops, blogs, guides, books, tools, and videos.

I joined the network to get business advice from people who shared my same purpose and values. With the help of “colleagues” from all over the world, I learned how to structure and scale my company, Collaboration Superpowers, so that myWork Together Anywhere workshop could be offered online and in person around the globe. I’m also now the remote team manager for Happy Melly.

Serendipity Turned Them Into a Team

The team at StarterSquad first started working together (remotely) when a client hired them for a software development project. They didn’t know each other before the project started, but over time, the team clicked.

At one point, the client unexpectedly ran out of money — but the team members weren’t ready to part ways. They decided to find other clients so they could stay working together. They now operate as a self-organised team of entrepreneurs, specialising in building minimum viable products for software startups. In addition, they offer seed funding for startups whose ideas they believe in.

Forget About Facetime

Another company, Teamed.io, prides themselves on having no central office, no meetings, and no phone, Skype, or video calls. The company is made up of a large group of freelance software developers that have never met or spoken to each other. They work entirely through chat on task management systems.

Specific people are brought together for projects depending on the skillset that’s needed. Projects are broken down into very small tasks. Programmers are paid as they complete tasks, and they are not paid if the tasks are not completed. When the project is over, the team is dissolved and everyone moves on to other projects.

Extreme? Perhaps. But it does show ways of working that were never before possible.

Leveraging the Remote Advantage

There are numerous benefits to being able to work from anywhere. Some resonate most for solopreneurs and digital nomads as a source of empowerment to work and travel. Others please HR departments and hiring managers who need to build virtual teams or want to offer flexible benefits to their employees. A few are aiming to raise visibility around worker happiness and the environmental benefits of not commuting.

The ability to tap into information and collaborate with colleagues from anywhere has opened up new possibilities for work-life freedom. People can work on the things they are most passionate about, and businesses can hire people who love what they do versus people who are just doing their jobs.

If you haven’t thought about what’s possible with remote collaboration options in a while, you might be surprised by what’s happening — and what’s possible for you as well! I encourage you to do some more exploring. We’ve come a long way, and it’s only getting better from here.

By: Lisette Sutherland from Collaboration Superpowers

Our office is closing! We can do better than just despairing

Jun 02, 2016

In March 2015 we received the bombshell from our U.S executives that our office in Oxford was to close as part of a long-term global consolidation of sites with some staff being offered relocation and the others made redundant. The products needed to continue, but how could we avoid the remaining time just being miserable?

Staff were asked to complete their current work and assist with knowledge transfer to the remaining development offices in the USA and India. The previous few years had seen good progress with agile and lean software development, customer satisfaction had steadily risen and staff turnover had been extremely low. So the closure announcement was a body blow. The chance of the announcement being taken badly was all too real with the risk of the situation disintegrating into a depressing mess.

The Oxford management team had the difficult task of trying to make the best of the situation and get the best outcomes for both staff and the company. One year on, the results so far have been remarkably positive. We can therefore make some recommendations for anyone else in this situation, some of which are also worth considering for companies during normal operations.

Actions taken

Long notice period – We managed to agree 18 months’ notice of the final closure. This was necessary to complete current work and have an effective handover so that the complex medical imaging software products could continue. However, it was a very long time to hope that people would stay so other measures were needed.
Generous redundancy packages. These were agreed at a level which impressed staff. With their tax-free nature, this gave people confidence that even if they didn’t find another job immediately, they would not have any financial worries for a few months.
Relocation support – Real commitment was shown to staff to find them other places within Siemens. This included generous relocation packages, funded exploratory visits for staff and families, advice from locals and flexible move dates. This was not cheap, but the cost was much less than hiring and training somebody new.
Voluntary end dates – Rather than imposing end dates, staff were asked to openly express whether they wanted to stay 6, 12 or 18 months. It’s very hard to predict how people will react so it was better to try to align individual’s needs with business needs. Almost 100% of people got they end date they wanted, most opted for the longer duration and the company had adequate cover.
Keeping a training budget – Staff were given encouragement to still do training and qualifications. The company would still get some benefit from the training in the short-term, it would help staff with finding a new position, but mostly it helped reassure staff that they could stay and still develop themselves.
A larger entertainment budget – It was important for people to socialise and support each other so there was an increase in company-funded drinks, lunches and a bigger-than- normal Christmas party.
Help with job-hunting – Staff were allowed to take some time for interviews and encouraged to have an open discussion on opportunities with support given to try to accommodate people’s wishes where possible. External consultants were available to advise on interview techniques, CV-writing and job hunting.
Effective use of employee representatives – Rather than just fulfilling a legal requirement, a real effort was made to engage with the elected employee representatives, create a detailed FAQ for staff and share all information on the intranet.
Continued staff recognition. The office was required to operate properly for an extended period so it was only fair that staff should be treated normally and retain the opportunity to still achieve an above-target bonus and the opportunity for promotion.
Management care – The managers have been very open, honest and helpful to the staff and shown genuine care and empathy for people and their circumstances. This probably made the biggest difference and enabled so many of the positive results. A site closure can be viewed by staff as a big breach of trust, so asking staff to believe promises about arrangements during the remaining period is a challenge and requires lots of reinforcement, consistency and ensuring that was is said is done.

Results

Staff morale – This went through the inevitable rollercoaster of shock, anger, worry then acceptance. People were annoyed or upset at the decision, but overall viewed the offers as fair and professional. Staff who had been through a redundancy before thought that the way this was handled was much better. Although losing colleagues is unavoidably sad, people have been positive about making the best of the situation.
Staff stayed until their agreed date – The long notice period and generous packages meant that most people were fairly relaxed about finding a new position and happy to leave serious job hunting until a few months before their agreed end date. Whilst, it’s an imposed change for everyone, in some cases, staff have appreciated having the “luxury” of having an extended period with a financial cushion during which to calmly think about what alternative job they would really like to do in future. Staff have been open about their hunting and have discussed mutually agreeable end-dates before accepting offers.
Results still achieved. Work on products continued at a good level. Inevitably people weren’t going the extra mile in quite the same way as they used to but were professional and productive. Staff have been helpful in ramping up new recruits in India and continue to take pride in their products. There have been no surprise, early, resignations or disciplinary issues.
A surprising number relocated. 25% of people relocated to the USA which was a lot higher than anyone originally expected since people liked being in Oxford.
Additional social events – The activity in the office “community” if anything picked up since the news with whisky tasting, a pool tournament, team nights out, a group cycle ride around town etc.
Peer-to- peer training – Staff have shown a great desire to support each other and proactively run open seminars for others in the office to share their knowledge with others (e.g. Sharepoint, Data Science, Android Programming, Arduino programming, Linux etc)
More cakes – We’ve always provided cakes on a Friday but the number of spontaneous cakes being brought into the office on other days has gone up.

Overall it has been a much more positive experience it could have been. The office morale is still good and the staff have received outstanding praise for their continued professionalism and dedication.

The results has been good for the company as there is a smooth handover taking place while ensuring that people are taken care of. The actions above have not been cheap for the company in the short-term, but are ultimately delivering better long-term value than the alternative of instant site closure followed by disorder and a long period of rebuilding a new team from scratch.

Suggestions relevant for companies not closing

Whilst some of the topics are only relevant to a site closure, some things could be beneficial anytime.

Management openness is always a good thing. It’s easy to forget the importance of explaining plans and listening to feedback. Make sure there’s time for group meetings, 1 to 1 sessions and occasional surveys.
Peer-to- peer training is always very cost-effective so time and support should be given for this. Staff have a lot of varied knowledge and it’s motivating for both the trainer and attendees.
Creative entertainment. It can be an easy area to cut, but pays back a lot. If people have a good social relationship with colleagues, they are much more committed to them and hence also the company. The entertainment does not necessarily have to be lavish e.g. a pool table and tournament, an indoor mini-golf area made out of office accessories and text books, a pancake- tossing event on Shrove Tuesday etc. Something a bit different every few months keeps things fresh. Cakes, are always good.
Look for the best outcome for both staff and the company given the circumstances. Arrangements with staff have to be fair to get the best results in the long-term.

By: Stephen Wells, Siemens Molecular Imaging, Oxford

What Rugby Can Teach You about Trust in Agile Teams

May 26, 2016

Summary:

Unconditional support, trust, respect, generosity, and courage are the behavioural values required for agile—and also for rugby. On the surface, the software development methodology and the rough team sport may seem to have little in common. But Luis Novella writes that rugby can actually teach you a lot about agile.

When I recently joined an agile team, I suddenly realised I had actually been implementing agile for a few years, just without leveraging the branding. It wasn’t until I listened to Johanna Rothman speak that it dawned on me: Not all things called agile are truly agile, and there are a lot of practices that are agile but are not categorised as such.

Once I understood what agile really means, I realised that I’d seen many of its central tenets contained in another system that’s important to me. Unconditional support, trust, respect, generosity, and courage are the behavioural values required for agile—and also for rugby. On the surface, the software development methodology and the rough team sport may seem to have little in common, but in this article, I’ll show you that agile and the sport of rugby are alike where it really counts—and understanding how to be a team player can improve your career as well as your game.

Trust in Your Teammates

Rugby teaches you to find the most optimal, collectively intelligent strategy within a group of diverse and versatile individuals. When everyone has this mindset, you get sustainability, innovation, and the pleasure of working with a team fully engaged toward a common goal. Overall, rugby is a decision-making game that focuses on shared leadership, and many types of it. It assumes that individuals will be specialists for certain tasks, but they will have the contextual intelligence to make the best decisions for the team based on a deep sense of self-awareness and consciousness of the other team members and the progression toward the goal. Sound familiar?

Despite having played a few rugby games here and there when I was younger, I never imagined the endurance of the behavioral blueprint the sport could generate in a high-performance team. I would argue that the training provided by rugby in terms of behavior is useful regardless of what agile technique or method best fits the particular challenge.

One of the key elements is trust and unconditional support between team members. Despite 160 years of updates, improvements, and new laws, rugby teams at any level still function the same way: When the player with the ball makes a decision, every single teammate actively supports and engages with his position and the context, aiming to provide the best options for the ball carrier (who is always the boss in rugby, if you are into the boss concept). Every player trusts that the decision-maker will make the best choice based on his vantage point, opposition, position on the field, and available support. Once a decision is made, everyone on the team makes the maximum effort for the result of that decision to accomplish the best outcome for the team.

The decision-maker also trusts that everyone behind him will be attentive and available. He believes that if his execution fails, no one will recriminate him; instead, he will be supported. In rugby, you inevitably “fail fast” and make plenty of decisions that turn out to be negative, but you know your innovation was encouraged and respected by the team. Your team trusts that you did the very best you can. They also trust that you have trained and prepared yourself to have been in the best possible condition to play.

Trust releases many opportunities in life. You can innovate and create. You can surprise the opposition. You can discover abilities in your teammates that you did not know were present.

I have had the advantage of working with business leaders who have the courage required to embark in agile transformations the right way—to really and truly happen, change has to start at the top, and the first one to change has to be the inspiration leader. In my opinion, this trust and ability to innovate and err generates pleasure in what we do. It makes our work open and helps us measure and get feedback, because you also trust that the people around you want to make you better.

Just like rugby, agile is a learning system in constant change played by a collectively intelligent team, and the team’s every move is enabled by trust.

By: Luis Novella from the Spark Team

https://www.agileconnection.com/article/what-rugby-can-teach-you-about-trust-agile-teams?page=0%2C1