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

Scrum Gathering Orlando Through The Eyes Of A Live Illustrator

May 17, 2016

Equipped with my graphic board, pens, sunglasses and shorts I set sail for the Scrum Gathering in Orlando. Having attended two awesome gatherings in the past, the bar was set high – however, I was far from disappointed.

From the offset, co-chairs Anu Smalley and Kate Megaw knocked it out of the park by entering the stage to the sound of ‘Starman’ by David Bowie, whilst wearing convincing spacesuits complete with helmets. This was their genius way of setting the Gathering’s theme ‘Infinity and Beyond: Transforming the World of Work’. With three tracks on offer, ranging from beginner (‘Mission Control’), intermediate (‘Orbiting the Earth’), to advanced levels (‘Agile Galaxy’), there were more than enough sessions to choose from for all 1100 attendees. Let’s not forget that this was the largest Scrum Gathering so far.

Although each session had a unique offering, there was an obvious key topic that resonated from all talks. During the CST/CEC retreat ‘Agile Leadership’ was introduced as a pressing subject, with one attendee keen to highlight the distinction between ‘Leaders’ and ‘Managers’. Brian Rabon reminded everyone that ‘Agile starts with Leadership’ during his opening keynote. A panellist on the PWC keynote pinpointed that any organisation would struggle without ‘Agile Leadership’, and Steve Denning went on to inform the audience during his ‘Agile Leadership’ talk that the key driver for ‘Agile Leadership’ is having a different mindset.

Leon Sabarsky identified during his ‘Extreme Scrum Hiring’ talk that an obvious flaw when interviewing individuals for team roles is to interview them on their own. His key takeaway was to move away from ‘One-on-One’ interviews by considering ‘Scrum Team group interviews’. This approach enables individuals to be assessed based on their engagement within the group, and demonstrate the qualities required for being an effective team player. It all comes down to good collaboration and communication, folks.

Leon noted that:

“the number one criterion that Scrum team members ought to be measured against is their Collaboration skill. It’s relatively easy to teach people a domain area, Agile methods and a specific technology. However, I can’t teach someone to collaborate well. They either have it or they don’t. If they don’t, they will reduce team effectiveness and cohesion over time.”

Another talk with an interesting twist was ‘Scrum Team CRM: Aviation Crew Resource Management Techniques for Scrum Teams’ by Thomas Friend. Using the narrative of flying aircraft, Thomas made strong comparisons between ‘Aviation’ and ‘Scrum’. Once again, the underlying message here was good communication.

During the Gathering another inspiring movement was unfolding. A group of passionate Agile Educators met face-to-face to carve out a manifesto for Agile that is authentic to Education. With a variety of case studies demonstrating how Agile values and principles have been adopted within an educational setting showing proven success, this group of innovative leaders were making a difference. They set out to define a vision and values for what resulted in the ‘Agile in Education Compass’, an inspiring model for how education can respond to the modern world with agility.

Once again, I had the opportunity to take to the pen and draw key insights from beginning to end. The canvasses enticed the crowds, and people soon took to Twitter to share the learning and store the visuals as a reminder of the Gathering.

Alongside this, on the final day, I couldn’t resist suggesting an Open Space topic around the use of ‘Graphic Templates’ which can assist coaches and facilitators in communicating with pictures. The session was a great success and those that attended were satisfied with their newly gained visual skills.

“Visuals speak volumes, this workshop encouraged me to draw and take these skills back to my team.” – Lynda Menge (workshop attendee)

Whether you wish to enhance your facilitation skills, make collaborative design thinking a key enabler within your team, or simply gain the confidence you need to draw live in front of an audience, join me for a one-day ‘Innovation through Visualisation’ workshop in London on the 1st of June or Atlanta on the 24th of July.

My final point on what drives so many people to attend the gatherings: passion and the desire to collaborate and share ideas. People attend these fantastic events for the discussions and seeds of information that are shared over breakfast, and last well into the evening over a cold beer, the networks that grow, and the desire to continue to collaborate way beyond the event.

I look forward to sharing some ideas with you at the next Scrum Gathering.

By: Stuart Young from Radtac

http://www2.radtac.co.uk/blog/scrum-gathering-orlando-through-the-eyes-of-a-live-illustrator/

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

Brace yourself Spark the change is coming..To France!

Nov 22, 2017

Also published on Medium.