Reinventing Business
Discovering Your Best Organizational Structure

Tuesday, November 17, 2015

A "Reinventing Business" Presentation in Czech in 2014

Here is one of the last versions of the "Reinventing Business" presentation I gave before Reinventing Organizations jumped me forward in my understanding of this whole project.

This was given during the Geecon Conference in Prague in 2014. One thing it shows is the value of using big fonts on your slides, since the videographer could just point the camera at me and the screen and capture everything.

Reinventing Business during Geecon Prague, 2014

Friday, October 30, 2015

Ignore Everybody

Always good to be reminded of this -- especially appropriate for the ideas in this blog.

Saturday, September 19, 2015

The Problem with Salaries

Planet Money #647: Hard Work Is Irrelevant

I've visited Netflix a number of times, and this is a very interesting perspective that I haven't gotten before. Something just feels wrong about this way of doing things.

Not that a company should keep people that don't contribute, but they seem so tightly tied to roles, and if we don't need your role anymore or you aren't doing it as well as we think you should, out you go. Any accumulated wisdom you have about the company goes too. The fact that you know how the company works, well, we can just train someone else up. We will ignore all those costs and losses.

Both Holacracy and Teal organizations de-emphasize specific roles, and emphasize each person having multiple roles. If you have zero roles then your value to the company comes into question, because either no one wants you on their teams or you aren't trying to be on teams, either way you've moved into a no-person's zone (at Zappo's they call it "the beach" and if you're on the beach for two weeks, you're out).

I wonder if the problem is in the granularity: Netflix defines a single role and pays a salary for that role, so if you fall below the role-salary equation you are out. There is no room for people who might contribute value in a partial way but not the full-bore way, which in my mind means that they are losing out on a lot of possibility.

The more I think about salaries, the less I like them. They are usually pitched like "as long as you get your tasks done, it doesn't matter how much you work," but for some reason it seems like most salaried people end up working more hours and not less. It has the same smell as companies adopting unlimited vacation because they've discovered that people take less vacation.

I actually like getting paid for my time. I think the deal has always been that I'm selling some of my life to you. A salary feels like a way for you to cheat and get more of my life. And the expectations are big, so (just like unlimited vacation) if I start actually using the flexibility, I'm "not a team player." It seems to me that paying for time is both more honest and more freeing. If I'm no longer productive today, I should go do something else and not worry about it -- I don't do the hours and I don't get the pay, but I feel OK about that, not like I'm somehow cheating the company as is the case with a salary or unlimited vacation (yes, it requires that everyone live within their means so they have the choice of stopping work when it makes sense, but I personally consider living within your means a very good thing).

Friday, July 31, 2015

The Code of Conduct is a Pattern

Looking back, I think we will see this moment in history -- when the idea of a code of conduct began propagating -- as one of the turning points in the development of self-organized systems. "Of course!" we will say, "Without a code of conduct some people show up expecting to get away with anything. Naturally you get bad behavior." We will also see the futility of trying to add a code of conduct after the fact, once the community has already been established. Culture must be nurtured, and once it's set it seems very hard to change -- although it can easily be destroyed.

Just like the various open-source licenses and the different Creative Commons licenses, I expect we will eventually have a set of open-source codes of conduct to choose from, depending on needs. I suspect we will also see templates for the philosophy of the organization, for example The Zen of Python and what I've tried to do in The Trust Organization Manifesto.

One of the questions that comes up around Teal/Trust organizations is "how do people get fired?" At least part of the answer is that a fireable offense is one that violates our basic practices for how we interact with each other -- our code of conduct.

I've begun collecting a list of sample codes-of-conduct here.

Thursday, July 30, 2015


Monday I visited Metolius Engineering in Bend, Oregon, which makes rock-climbing equipment. They are rather unusual in that they take in aluminum alloy stock and machine it from start to finish, then assemble things like cams to insert into rock cracks. I would describe Metolius as an "intentional anarchy." Basically, no one wants to be anyone else's boss, which produces a self-organizing structure by default. Almost everyone who works there is a climber and so cares deeply about their products. But there's no particular structure for you to fit into, so you either find your own level or you leave. For the people who are there (that is, who don't leave), it seems to work quite well.

I have a friend who created an UN-intentional anarchy by bringing together a group of artists under one space. There were expectations but the self-organization never really took place and my friend ended up being the enforcer and the place the buck stopped. It drove her temporarily bonkers and ended up costing her a lot of money.

Just like open-spaces conferences, you need SOME kind of framework to work within. Ideally it:
  1. Is the minimum necessary to achieve your goals
  2. Doesn't tend to start expanding
  3. Doesn't add unnecessary overhead
Many startups begin this way, but then reach a point where, it is asserted by those-in-the-know, the company must grow up and put in a proper hierarchy, with MBAs in all the right places. At which point the above three points rapidly stop working, and everyone gets less efficient as the company gets bigger (vs. cities, where people get more efficient as the city gets bigger).

The framework needs to be such that there never comes a need for the "grown up" organizational structure.

My OSCON presentation went well; there was some good discussion afterwards and some interesting connections. For example, I found out that RedHat is working on The Open Organization, a system with similar goals.

Monday, July 20, 2015

Heading to Portland for OSCON; Slide Deck + Manifesto

If anyone is in the area and would like to try to meet up while I'm there, email mindviewinc at gmail.

Also please tell me if you know of interesting organizations in Portland. I've been late in looking but I thought I'd give it a shot anyway.

Here is the link to my slides (with speaker notes which comprise most of the narration for the presentation; I've never scripted a presentation before but this one needs to be tight): Creating Trust Organizations. The presentation will probable evolve a bit more before I give it (OSCON is recording it and will eventually post it).

And here is the first cut of the Trust Organization Manifesto, referred to in the presentation: This is intended to be a working document, used on a day-to-day basis for organization colleagues to remind themselves how the organization works and how they fit in it. Naturally, I expect it to evolve as we learn.


Some very interesting thoughts in this article. Apparently there's a book just out on the subject, as well.

Monday, June 29, 2015

The Best Summary of Teal Organizations So Far

Here is a slide deck that gives quite a thorough introduction to Teal organizations, including insights that I've also spontaneously considered in my own research. I think I've seen (and perhaps linked to) an earlier version of this deck but if so it has gotten much, much better.

I feel like I've been waiting my whole life for this kind of organization. Bits and pieces of these ideas have presented themselves but they've always seemed ridiculous in the context of industrial-age management thinking. I want to either work with such an organization or, more probably, create one.

The creation of such organizations is where I might be able to make a contribution, and I'll be giving a presentation called Creating Trust Organizations at the upcoming OSCON in Portland. I've been putting a lot of effort into this presentation and hope that I'll be able to give it many times, whenever I travel.

Monday, April 6, 2015

Holacracy vs. Teal

(I've been rather absent from here lately, working on the now-complete Second Edition of Atomic Scala. However, more programming-oriented projects are in the queue so posts here might be spotty).

Here's a nice article on Holacracy. When I took the training a couple of years ago, I found it extremely useful and inspiring, more than worth the costs. But, as often happens in my explorations (especially company visits), something started bothering me over time and I couldn't put my finger on it until now.

As the article points out, people who don't understand it expect Holacracy -- because it's a form of self-management -- to be a free-for-all, and it's quite the opposite. Holacracy is a process for you to build your own structure, customized for your company (rather than rubber-stamping the same hierarchy used by every organization from the industrial age). So, quite the opposite of having no rules, Holacracy is the way that you create your rules.

That's where it bothers me. Even though there's a lot of emphasis in Holacracy on not adding rules you don't need. It's probably because of my experiences with Open Spaces, where we create just enough structure to produce interaction, and no more.

That's not to say Holacracy can't achieve this, but my gut feeling is that there are some reactionary parts of it, trying to prove that it's a real, grown-up thing. In fact, part of the Holacracy contract is about protecting Holacracy, agreeing that you will either do everything in the Holacracy practices, or "officially" back out of it and stop saying you're doing Holacracy (because people like to pick and choose practices).

While I understand the motivations, I don't care about them. It doesn't serve my goal of creating an amazing organization. Let me be clear, I think Holacracy is a huge step forward and makes important inroads, and may in fact be just what an existing organization needs to transition into a much better organization. Indeed, Holacracy might just be about that transition.

But it doesn't go far enough for me. I think the brain in my gut is telling me that, while I would much rather work at a Holacractic organization than an industrial-age organization, I ultimately wouldn't be happy there. Although it minimizes the rules, Holacracy is ultimately still about how to create rules, and I guess I just don't like rules -- if we must have them, they need to be only a few, that you can keep in your head and use to guide yourself (like Netflix's "freedom and responsibility"). Or the rules below.

I've had a fundamental-shift experience in recent months: reading Reinventing Organizations by Frederic Laloux. I will read it again, and I found myself stretching it out because, after years of looking at how to "fix" existing organizational structures, it was such a relief.

Laloux looks at the history of organizational development in evolutionary terms, considering the environment and what kinds of structures it supported. He classifies these structures by color, and each step forward produces an organization that is able to become larger and accomplish more. He foresees the next evolutionary step as the "Teal" organization, of which he gives a number of examples of existing, thriving companies (including HolacracyOne, LLC, the company that created and promotes Holacracy).

Here are the three foundations of the Teal organization (lifted from this review):

  1. Self-management:  To operate effectively based on a system of peer relationships, without the need for either hierarchy or consensus.
  2. Wholeness:  People no longer have to show only their “professional” self, or hide doubts and vulnerability.  Instead, a culture invites everyone to bring all of who we are at work.
  3. Evolutionary purpose:  Instead of trying to predict and control the future, the organization has a life and a sense of direction of its own.  Everyone is invited to listen in and understand what the organization wants to become, what purpose it wants to serve.
Here's a huge difference between Holacracy and Teal. In Holacracy, you figure out roles and responsibilities -- who is able/responsible to make what decisions. But in Teal, anyone in the organization can make any decision (including one that costs the company money), as long as they use the "advice process": you must talk to people who know more about the issue than you, and you must talk to people whom the decision will affect. You can still make the decision even if both groups recommend it (so the company can be very experimental), but one of the few fireable offenses in a Teal organization is not following the advice process. This ability for anyone to make a decision shows just how different Teal is. It's the very thing that I've seen work so well at the Open Spaces conferences that I hold.

I recently attended a week-long Esalen workshop led by the creators of Cafe Gratitude, where the emphasis was on point 2, wholeness. Although Cafe Gratitude is not a Teal organization (there is a management hierarchy), the focus on wholeness has made it a special place for both employees and customers; I suspect its success is precisely because of this emphasis. They use a practice called "clearing" (nothing to do with Scientology) that each employee experiences at the start of their shift -- you pair with another person and clear each other. They wanted an app, so during the Winter Tech Forum I worked with another attendee and built it; it's here and runs on all devices. The app walks you through the clearing process.

Holacracy is great, and I will visit Zappos again to see how the largest (so far) Holacracy experiment is progressing. Holacracy has a place in the world, but Teal feels like my color.

Monday, March 16, 2015

Do What You Love

An old but very insightful article by Paul Graham describing one process for discovering your best life path. Also see Start With Why and What Should I Do With My Life?

Hiring: Steps in the Right Direction

This is a nice post that describes how incompetent our hiring approaches are. In particular, interviews are a terrible way to find employees, because they basically test how well a candidate interviews and not much else. The article describes some better approaches to the problem. One of my favorite observations is that if a candidate doesn't understand a technology, buy them a couple of books and give them a couple of weeks to get up to speed.

I envision a completely different way to discover whether someone is a fit, that all but the most primitive companies will eventually use. The open-spaces conferences I hold have turned out to be fertile hiring ground, for example. You get to see a candidate in various creative situations, with the added bonus that they don't even know they're being interviewed.

Monday, March 2, 2015

Abusing Unlimited Vacation

Unlimited vacation time has become quite the rage among companies. What's happened? Have industrial-age companies suddenly seen the light and realized the benefits of treating employees really well? As you might guess, the answer is no.

It turns out that social pressures around job security outweigh the desire and need to recover from work. Across the board, when companies adopt an unlimited vacation policy, employees take LESS time off. Human resources gets a win while looking like heroes for such a liberal policy!

But it gets better. If vacation time isn't fixed, it basically doesn't exist. It's not an accounting liability on the books. Best of all, if you quit, the company doesn't have to pay you for accrued vacation! Now companies are adopting unlimited sick time, presumably to add to the benefits of unlimited vacation.

Here's a great story about the failure of a well-intentioned unlimited vacation policy (along with numerous other problems with vacation systems, and links to other articles -- especially see Jacob Kaplan-Moss' analysis), and how they fixed it: by adding in a minimum required amount of yearly vacation (I can just feel the MBAs and HR folk squirming when they read that).