MANAGEMENT SPECIAL ....Unlocking the Benefits of Self-Management Without Going All In on Holacracy PART II

Unlocking the Benefits of Self-Management Without Going All In on Holacracy PART II

3. Distribute authority and embrace total self-management.

Making your organization’s purpose clear and explicit, and digitizing how you organize to do the work builds a foundation of trust. The relationship between the organization, its leaders, and everyone who works within it is now grounded in a mutual understanding about where you’re going, and what is expected of each person to help get you there. Congratulations, you are now ready to unlock the power of self-management.

In a truly self-managed organization, each member and each team has both the authority and expectation to act as they see fit. Each person is trusted by the organization to use their best judgement to determine the best path forward in service of the organization’s collective purpose. For example, at August if someone thinks it would be valuable to hire a freelance designer to help create an important set of training documents for a client, they can go ahead and engage that designer without getting “approval from finance.” It also applies to larger, thornier issues. All team members have an active role to play in determining how we set salaries, distribute profits, and even assign equity. And anyone, regardless of seniority, role, or tenure, can propose changes to any aspect of how we operate.

This approach is popular at leading tech companies like Google, Amazon, and Facebook, where engineers push updates to the live platform with minimal oversight from very early on in their tenure. But it can and should extend much more broadly beyond software engineering.

At Zappos, customer service employees are empowered to do whatever is necessary to “wow” their customers. Seeds of this kind of employee trust can be found in much older organizations, as well. The manufacturing company W.L. Gore, famous for Gore-Tex and other patented inventions, has used a similar model for over 50 years. And even before that, Xerox Parc and Bell Labs harnessed this kind of employee empowerment to drive wildly prolific cultures of innovation.

At Undercurrent, we always had an implicit expectation that individuals and teams should be trusted to use their best judgement in nearly all situations. But, even with this cultural value in place, many decisions kept running into a “management” bottleneck. Whether it was as simple as reviewing a scope of work, deciding how to staff a project, or even what our parental leave policy should be, a select few “senior” leaders were making the final decisions, when actually many other team members could not only be trusted to make a good decision themselves, but moreover other team members might actually provide a better and more informed perspective on the decision than these senior leaders. We knew that those closest to the problems were best positioned to solve them; we just needed to let them.

At August, we are going all in on self-management. We are even using it to make decisions about equity and compensation. We commit to encouraging each other to claim as much decision making authority as possible, in all situations. When in doubt, the default is “DO even over ask.” Because most of the time whatever the team member would do is the right thing; and the few times that it turns out to be the wrong thing, we can adapt.

In this new era, no one is anyone else’s ‘manager.’ No one tells you how to do your work. Each team is fully responsible for doing what is expected of them, and deciding for themselves how to get the work done.

What makes this completely autonomous approach work are three interconnected behaviors and new practices:

Distributed Authority and Clear Domains – Each team, and the individuals within it, has explicit permission to do whatever they think is needed to accomplish their own team mission. The only restrictions are specific domains that are explicitly owned by another individual role or team. If you need to make a change to something that is explicitly within another team’s domain, you need to go through them and get their consent.

Proposals and Advice – When you recognize a problem or opportunity that impacts the work of other teams or roles, it is incumbent on the person who identifies the issue to propose a specific change or course of action, and to seek the advice of all those affected. When collecting advice, it’s important that all voices are equally represented, and that their perspectives are heard and respected.

Consent Over Consensus – Collecting feedback on every important decision could easily devolve into a downward spiral of discussion and unending debate. This is why it’s critical to pair the advice process with an explicit bias for consent over consensus. The default assumption is that the proposal will move forward. We only amend the proposal if another individual or team has evidence of why the proposal will cause immediate harm to the business in the near term. When these rare objections occur, it is then incumbent on the objector to propose an amendment that would make the proposal safe to try.

One specific process that is adapted from Sociocracy, and used in Holacracy, is something called the Integrative Decision Making process. It is a highly structured and facilitated method for collecting feedback on a proposal and gaining consent on group action.

·         Proposal: Describe the issue you’ve identified and propose your change or course of action.

·         Clarifying Questions: Each participant can ask questions to clarify their understanding of the proposal. Only the proposer is allowed to answer.

·         Reactions: Each participant can share their thoughts about the proposal, including support, concern, and suggested edits. The proposer does not respond or participate.

·         Amend & Clarify: After listening carefully to the group’s reactions, the proposer can clarify their original proposal and amend their proposal to incorporate the group’s feedback.

·         Objections: Each participant is asked if they have any evidence why the proposal, as stated, would cause immediate harm to the business, or if it is safe to try.

·         Integration: If there is a valid objection, the objector and the proposer work together to find a mutually acceptable middle ground.

If there are no valid objections, or once valid objections have been addressed, the proposal is accepted.

When using this process, make sure that you have a shared document — flip chart or Google Doc on a large screen — where you write down the specific proposal so that everyone can react to the exact same content, and you are 100% explicit about what you’re committing to.

4. Never stop iterating.

Everyone is familiar with agile methodology and its merits. It’s been a clear winner among successful startups and has become the assumed best-practice for enterprise as well. But, the need to continually test and learn in today’s business world is not limited to the discipline of software engineering. As Undercurrent shifted to this new model, we realized that we could bring this same agile approach to all aspects of our work and our organization itself.

At August, all of our projects, both internal and external, operate on a weekly sprint rhythm. Just like an agile software team, our consulting project teams hold weekly stand-ups on Monday to review priorities and assign tasks, and we ship work out to our clients every Friday regardless of where the work is at. As Lorne Michaels likes to say to the cast of SNL, “The show doesn’t go on because it’s ready; it goes on because it’s 11:30.” That’s the mindset we bring to our consulting work.

Having applied this approach across many diverse functions at our company and within our clients’ organizations, we have become convinced that the make → ship → learn → iterate process can and should be applied everywhere in your organization.

One of the important side-effects of bringing this constant iteration and fast-pace of change to all of your work, is that it begins to dramatically open up the organization’s collective aperture for what’s “safe to try.” As I mentioned in the decision-making process, we intentionally try to set an extremely high bar for what constitutes a valid objection to someone’s proposal. We seek to create an environment where individuals and teams are empowered to move forward with as little organizational resistance as possible.

By embedding a weekly rhythm of shipping and pivoting into our organizational DNA, we create a bias for progress over perfection. Nothing is ever finished, there’s simply a new version to test and learn from.

Importantly, this test-and-learn mindset even applies to our organizational structure itself. Using all the tools we’ve discussed, every team at every layer of our company meets on a monthly basis to re-organize. Instead of the infamous annual company-wide re-org exercise, where corporate territory is redrawn and fiefdoms are redistributed, we constantly evolve through a continuous and incremental re-organization exercise. Even significant restructuring decisions are much less painful than normal, because they are guided by a common purpose, and they are proposed and owned by the same people they impact.

The fuel for this practice of rapid iteration is feedback. This means that every project or team needs to have clear and explicit metrics that are tracked and reported on a regular basis. Each of our teams reports key metrics on a weekly and monthly basis. These key metrics are captured in a single shared Google Spreadsheet that is accessible to all members of the company. Each team begins their weekly tactical with a review of their metrics, and the leadership team begins its own weekly tactical meeting with a review of all team metrics.

Over time, an organization who works in this way builds an ongoing record of action and results. You begin to see patterns in the data, and can begin to base new decisions on historical trends. Most importantly, you can begin to make all decisions evidence-based. Whenever anyone proposes something to try, there are only two valid answers:

·         We have clear evidence why your idea will cause immediate harm; here’s a proposed amendment…

·         We don’t have any evidence, yet, that your idea will cause immediate harm; let’s give it a try and see what happens. (We’ll talk again next week.)

When this outlook becomes a habit, you’ll start catching yourself critiquing each other’s ideas or on the verge of devolving into a theoretical back and forth about what to do. Then, you’ll stop, and say, “But, who knows, right? Let’s try it and see what happens.” At Undercurrent, we actually adopted a fairly radical policy that was intended to help employees who wanted to leave find a mutually beneficial new job.

The original policy stated that employees who wanted to leave could opt into a ‘Search’ role, and could focus full-time on searching for a new job, while continuing to receive their Undercurrent salary, indefinitely. While we all empathized with the intention to create a more amicable departure, we also all agreed that this seemed like a crazy idea. But no one had any evidence why it would cause immediate harm. So, we went ahead and adopted it, and waited to see what would happen. Only after we had feedback from the first person to use the policy did we eventually edit it to be slightly more proscriptive.

5. Work in public.

Now that you’ve handed over the keys to everyone in your organization, the one critical ingredient you’ll need to make the system click is open information. If you’ve built a stellar team of people who are committed to your collective purpose, and provided all of these other supporting practices, then the only potential land mine is a lack of information.

At August, “working in public” is the default practice, and we aim to make it a hallmark of our organization. We have even created a public Google Drive where we intend to share as much information about how we operate as possible. Some of the items we will share here include: our operating agreement, salaries, cap table, all our governance and policies, teams, roles, accountabilities, and IP about how we do our work. And we’ll be adding much more to this over the months and years ahead.

We apply Google’s mantra of “open by default” across everything we do. This means that it is assumed that any document you’re creating or information you’re sharing should at a minimum be accessible to all members of the organization and ideally be directly shared with the entire organization. We use five key tools to help enable this way of working.

Slack: The vast majority of our internal communications now take place in Slack. We’ve embraced Slack’s open channel functionality to create more transparent forums for discussing the work. All teams have their own channel that is open and accessible to all other members of the organization. We’ve tried to double down on the move toward transparency by holding each other accountable on a 1-on-1 basis. If I fall back to an old-school mindset and send a direct message to a colleague about something that doesn’t need to be private, my colleague may respond to my question back in the shared public channel, as a reminder to work in public and to ensure that the information is easily discoverable by other teammates at a later time.

team@aug.co: Since most of our internal communication is now in Slack, we rarely send any internal emails. We do, however, use email to archive important client communications. We do this by bcc’ing a company-wide email called “team”. Over time this listserv will become a library of useful templates for business development follow-up notes, key client deliverables, and a social reinforcement mechanism for sticking to our weekly rhythm. Each team bcc’s “team” when they send out their end-of-week shipments.

Trello: This low-fi and easy-to-customize task management tool has become a critical part of our open workflow. Project teams use Trello to capture and keep track of their weekly tasks. Project and resource allocations are planned and communicated in Trello. And proven processes for certain types of projects are captured, replicated, and iterated on in Trello.

Metrics Dashboard: As I alluded to earlier, every team tracks key metrics, and these metrics are collected in a single shared Google Spreadsheet. This dashboard gives everyone the same point of reference for what’s working and what’s not.

Cloud-based documents: In Undercurrent’s early years, we devoted countless hours and attached a good deal of our pride to creating exquisite Keynote presentations. They were perfect, beautiful, and incredibly slow and static. When we pivoted to this self-organizing model, we decided to completely embrace web-based multi-tenant document tools (primarily Google Docs) and cloud-based file sharing. Google Docs makes it nearly impossible to make things look too pretty. And simultaneously, it’s incredibly easy to collaborate with your teammates, to replicate work that you like, and to discover each other’s work. After 2 years of this, we can not imagine how any teams still get work done any other way.

One of downsides of this way of working, of course, is that the deluge of shared or broadcasted information can be overwhelming and hard to keep up with. The experience of opening up Slack after a day away from the office, can be a lot like the Google/Facebook dystopian satire described in Dave Eggers’ The Circle:

The chute opened, and in the first 12 minutes, she answered four requests, her score at 96. She was sweating heavily, but the rush was electric.

But, the upside is that everyone has the ability to make quick decisions for themselves, without having to wait to get useful information from anyone else. Also, when everyone has access to all the information, novel ideas and solutions spring up from all corners of the organization. Everyone has the ability to help steer the organization toward its goal.

So, what will the future look like?

The most valuable work for humans — not computers — to do in the years ahead will be the most complex and unpredictable work there is. It is the least routine tasks and the most unknown environments where we’ve got the computers beat (at least for now). Even if you’re the one building software that may make someone’s job obsolete, or you’re making something that allows us to harness computers for the betterment of humanity, it will take a team of human beings to accomplish your mission.

This future has two critical implications.

One: Complex and creative work depends on high-performing teams who know how to work and learn together.

Two: The traditional command-and-control operating model used in most organizations actively gets in the way of its employees ability to work and learn together.

The tension between these two realities has reached its breaking point. Leaders of startups and fast-growing businesses feel this pain acutely. How do you build a structure that helps you scale while also protecting the speed and agility that made you successful in the first place? When you look around, it seems like the only options are to either adopt the old model that defined business in the 20th century or to cross your fingers and embrace chaos.

There is, however, a new way. A new operating model is emerging that enables a company to self-organize to achieve its purpose without bureaucracy or top-down management, while continuously adapting to changes in its environment.

A revolution is afoot. All around the world, insurgent organizations are rising up and insisting on doing things a new way. This new way of working enables the organizations that embrace it to succeed. And the organizations who refuse to change will die.

Changing the way we work is hard. But, giving people the tools, know-how, and confidence they need to give it a try is literally why I come to work. As you give it a try at your own organization, I encourage you to also work in public, and to share your lessons as you go. August will be at your side, pursuing our purpose.

http://firstround.com/review/unlocking-the-benefits-of-self-management-without-going-all-in-on-holacracy/