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

Jun 02, 2016 by lsmit@wemanity.com in Blog

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

In the family way

Apr 29, 2016

It’s funny how things work out, what we see when we open our eyes and raise our curiosity.

In particular, two events this week that in one moment filled me with dread, then filled me with hope and possibility.

Firstly, on Wednesday a colleague sent me an article from The Economist about the quality of managers in the UK. The article reflected on the following:

The low productivity of British workers has several possible culprits. Inefficient family-run companies are sometimes blamed, as are poor workforce skills. But whereas these problems are well documented, another factor is glossed over: the mediocre performance of British bosses. John van Reenen, director of the Centre for Economic Performance at the London School of Economics, argues that the standard of British management is “significantly below” that in leading countries. His team carried out 14,000 interviews with employees around the world and found that British workers rated their supervisors lower than those in countries such as America, Germany and Japan. “We are not in the premier league,” he says.

Management as a skill has rarely been taken seriously in Britain, where the cult of the gifted amateur prevails. Ann Francke, the head of the Chartered Management Institute (CMI), says that four out of five bosses are “accidental managers”: they are good at their jobs but are then promoted into managing a team or a department, without further training. Unsurprisingly, “they flounder”, she says. Mr van Reenen reckons that about half the productivity gap between Britain and America could be attributed to poor management.

http://www.economist.com/news/britain/21679215-business- gets-serious-about-running-business- end-accidental-boss?fsrc=scn/li/te/pe/ed/endoftheaccidentalboss

Inefficient family run companies? Funny that, because on the very next day I found myself in need of the services of a family run company. My wife’s lovely Michael Kors watch had used up all of it’s battery charge and a replacement power cell was needed. The most obvious place to get this done is my local Timpsons.

You may know of Timpsons. You may even be a customer of theirs – everything from key cutting, engraving, shoe repair to wrist watch maintenance. But do you know John Timpson’s approach to management?

In a recent article in The Independent, Mr Timpson explained his philosophy.

His way of avoiding top-heavy management is to do away with their jobs. “When I introduced my ‘upside school of management,’ which is putting the customer at the top of the matrix and management at the bottom – and giving staff the freedom to run their own shops – our middle managers didn’t like it at all. Many left.”

As he admitted, Timpson is a funny business. It does all the odd jobs that no one else wants to do, whether its key-cutting or, now, watch and mobile phone repairs. “This wouldn’t have worked if we hadn’t understood the importance of picking the right people and giving them the freedom to look after customers and to decide how to run their shops and to set their own rules. That is the core of our success.”

http://www.independent.co.uk/news/business/analysis-and-features/john-timpson- all-the- great-retailers- know-their- customers-does-ms-a6697471.html

So what was my experience? As someone who is often frustrated by lack of customer service, I find the whole Timpson experience leaves me with a smile on my face.

I took the opportunity today to ask the 2 guys serving, what is life really like as an employee?

Their answer was simple “Great!”

Why, I asked. “Because we are left alone to get on with it. This is our store. We get guidance, sure, but we make the decisions because we are with the customers every day”.

And how does that make you feel? “Trusted!” was the immediate response.

But does this upside down school of management work commercially?

Well, Timpson recently reported sales up 12 per cent to £189m and profits 38 per cent higher at £18.7m. Furthermore, over the past three years the company has grown rapidly – from 800 stores to 1,400.

Yet again, more evidence that shows having engaged staff not only results in a better, happier work place, it also brings commercial value.

By: Mark Manley from Gaia Leadership

If you would like to learn more about how to build engagement within your organisation, please contact me

mark.manley@gaialeadership.com

I write these articles as part of my own learning. Thank you for reading it.

If you like it, please share it.

Why we should lean into risk in Brexit Britain

May 10, 2016

I was going to write a blog about risk. I’d whip through the theory, focus on the practice, and back it up with science.

Then the referendum happened. And now, depending on your view, the country’s either deep in the mire, or free to succeed. The markets have crashed, but might bounce back. Hate crime is up, but might be a blip. We’re living in uncertainty, and we don’t even know how long it’ll last.

All of that feels uncomfortable and risky. So to write about risk without acknowledging the uncertainty around us feels a bit absurd. We’re already awash with political analysis, so I won’t add mine. But whether you’re delighted, devastated or unmoved by these events, it’s an interesting moment to take a look at the parallels with organisational and personal change.

Major change throws the status quo in the air. Before it settles, as it inevitably will, we can make some choices. We can pretend it’s not happening. We can choose to step back and see where the pieces fall. And we can choose to take a risk and lean into uncertainty. These are decisions organisations are making now – as they’ve done before and will again. Individuals are doing the same.

Unless you’re very lucky, pretending nothing’s changed will leave you baffled, and your colleagues disengaged. It’s also, counter-intuitively, a lot of effort. Our ability to adapt is part of what defines us as human. So while adapting might be hard, refusing to is exhausting. Sometimes, of course, the wisest move is to hold your horses and wait for a new normal. But you forfeit the chance to shape it, and risk being left behind.

Choosing to shake hands with uncertainty can be complicated and uncomfortable. It can also be profoundly creative. If you can lean into that, there’s scope to experiment with new ideas and products, have different conversations and make unexpected connections. You might fail, you might succeed, you might create something a bit… ‘meh’. But you only find out if you take the risk. And whether or not it’s sparked by external events, embedding a culture of testing, adapting and improving will reap benefits well into the future.

Thing is, it’s not easy. There’s a gap between intention and doing. And however much you want to, crossing it can seem boring, painful and hard work. And once you do cross it, there’s no guarantee it’ll work. Ugh. Why bother? It’s somehow easier to feel disrespected afterwards than to challenge in the moment. To feed back to your friends instead of your colleagues. To work within stasis than to venture an alternative.

But that ‘ugh’ is worth the bother. It’s when things shift, and when you learn. Plus you reinforce in yourself and colleagues that, whatever the outcome, you are people with the agency to create change. You’ll be more likely to do it again, helping build a culture of creativity in yourself and others.

So where to begin? Here are three initial suggestions.

1. Acknowledge fears, but don’t draw them out. Give yourself three minutes to project the potential range of outcomes from best to worst. Then begin, ditch or adapt. You’ll only find out what actually happens by taking the risk, so don’t waste time on the fundamentally unsound, or delay the great.

2. Solicit feedback; ask, listen, learn, adapt. And be specific: work out exactly what you want feedback on, and ask questions within a clear remit. This shifts the focus away from egos (easily crushed, despite denials) and towards ideas. Seeking feedback can feel like a massive risk in itself. But the more you do it, the easier and more useful it becomes.

3. Build networks. It’s exhausting taking a risk on your own and it takes ages. Talk to people who disagree: diverse opinion makes for robust ideas. And test the idea as soon as you can, drawing on your network for support. Make sure your network includes people unconnected to your idea, but who can help you reflect on progress and remain resilient. Action learning sets and peer mentors are ideal.

I’m not suggesting all ideas are sensible or risks worth taking. But change is definitely coming. New systems, new products and even new industries may emerge. I hope that as organisations and individuals we’ll be inspired to lean into risk when we encounter it. Start experimenting, adapting, innovating. The status quo has been shaken, and will rebuild. The space in between is yours to shape.

By: Kamala Katbamna from Chirp

http://www.chirp.org.uk/new-blog/2016/6/29/risk-taking-in-a-post-brexit-britain

Company culture: an open and shut model

May 20, 2016

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

Rudyard Kipling, In the Neolithic Age

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