Chapter 3: People, Company case studies

Here’s the section in the People chapter where I’m showing the reader some of the companies out there doing progressive, brilliant or odd things to help their people give their best at work.

It’s a section that excites me, so I really want it to be excellent – please give me feedback wherever you feel necessary.

Also, I’ve been reluctant to talk about NixonMcInnes – this book isn’t about promoting us as we are a tiny consultancy and as flawed as we are brilliant. But in the end it felt like the People practices we have just fitted into Culture Shock and obviously how we do things is material I know so well, so I whacked NM in. Let me know if you think that’s a bad thing or risks credibility somehow please.

Thank you.

So which businesses really celebrate and engage their people?

Zappos

Zappos should be a boring business, shouldn’t it? To massively oversimplify, Zappos is a website, a warehouse full of shoes, and a bunch of people answering telephone calls and enquiries. Dull. Like that beige colour that old school PCs were (or still are?). Yet Zappos may be the most colourful business making waves at the moment – thanks to its unique culture Zappos is all the colours of the rainbow, it’s a graffitti-spraypainted dancing unicorn with a beating heart and crazy eyes.

Zappos is essentially a business built around the principle that if you create the environment, hire the right people and so develop the right culture, you will thrive. And Zappos is delivering against that belief with a thriving business: widely recognised to the be the largest online shoe retailer in the US, it was bought by Amazon in 2009 for about $1.2bn, and is believed to turn over in excess of $1bn per annum.

For the whole story, you must read CEO Tony Hsieh’s book ‘Delivering Happiness. But looking at just a few of Zappos practices should help inspire us all.

Family

Zappos staff use the word family lots. Not just when they speak or write, but publicly on their website and in company materials and their annual Culture Book. The great thing is if you say you’re a family, then you have to live up to it. This is not ‘employee relations’ – the whole thing is powerfully reframed in a way that leads to an entirely different approach at Zappos.

Create Fun and a little Weirdness

Zappos has 10 Zappos Family Core Values. Core value number 3 is ‘Create Fun And A Little Weirdness’. I just love that! And this value clearly permeates everything that Zappos do: from their All-Hands meetings, to their office decor, through to their hiring processes. What could be further from the conventional brainwashing about how people should behave at work? We don’t want you to be ‘professional’, we want you to be WEIRD.

Reply-All hat

One of my favourite Zappos people initiatives in their Reply-All hat. You know that moment when, in a medium or large-sized organisation, you or someone you know unwittingly replies to ALL? Ouchy! At Zappos to celebrate that moment they have a Reply-All hat. Not just any hat, this is a gaudy, ridiculous plumed showgirl hat, and if you are unlucky enough to have Replied-All, you wear the hat and have to parade around the Zappos offices while being shouted and whistled at. You also are at risk of having photos taken, or even a video made! It is as brilliant and mad and awful as it sounds, and I for one wish our team was big enough to warrant one!

Zappos tours and Happiness Delivered

The Zappos culture is so potent that they are increasingly sought out to spread their ideas. They offer free, daily tours (and will even pick you up in a minibus from your Vegas hotel), and their inspiring CEO Tony Hseih has written a book called Happiness Delivered. They also now have a part of the business called Zappos Insights to provide training and consultancy services to other businesses.

Can you see how engaging the Zappos culture is to people like you and me? And also how straightforward it is – completely unlike traditional business, but completely human and immediately recognisable as fun AND smart ways to go about things? A great company.

W. L. Gore & Associates

W. L. Gore & Associates is quite a mysterious business. The makers of many innovative textiles including Gore Tex, the well known breathable waterproof fabric, the company has an extremely interesting approach to people and structure.

What must be said is that for Gore, these practices are not new. Though the ranting and railing in this book is against the staid, stupid mainstream management practices of the 20th century, Gore is a 20th century success – Bill Gore founded the business with his wife Vieve in the 1958! However, if we are able to spread them, then it will not matter how old they are for in most organisations these concepts, practices and the overall culture they create will be utterly new and very different.

Team size and lattice structure

One of the few things that is reasonably well known in the business community about Gore, which remains to this day a privately-held enterprise, is its unconventional practices around organisational structure which fifty years ago must have seemed genuinely bonkers, but today – though still unconventional – can seem much smarter.

Gore’s structure is made up of two particularly interesting components: their team size and their lattice structure.

Team-wise, the business operates very small plants – typically a maximum of 250 people in each. So for every 250 people the organisation has to provide a different building and replicate the same core structure that a single plant requires. We can safely assume that there are inefficiencies here in staff, in building costs, in equipment. Everything is replicated rather than lumped into the same ever-growing mega-plant! But in the words of their current CEO Terri Kelly, an engineer by training and only the fourth in Gore’s history, “we divide so we can multiply”. How does that work? The Gore organisation believes that it can unlock much greater innovation and engagement from its people by keeping smallness. In the mythology of Gore it is said that this was driven by the founder Bill Gore walking around a plant one day in 1965 and realising he didn’t recognise everybody any more. From then on he put in place a principle that no more than 200 people would work in the same building. The company’s growth record, enduring innovation and constant presence on ‘Best company to work for’ lists suggests they might have a point.

Even more radical is Gore’s lattice structure which shares more in common with networked organisations like Al-Qaeda, Anonymous and the Occupy movement than the traditional org chart.

In Gore, there are ‘few’ org charts and ‘no chains of command, nor predetermined channels of communication’. So how does work get done? How do people organise themselves? Put simply, how do they manage a multi-billion dollar global business without such structure?! As they say on their own website:

“Associates (not employees) are hired for general work areas. With the guidance of their sponsors (not bosses) and a growing understanding of opportunities and team objectives, associates commit to projects that match their skills. All of this takes place in an environment that combines freedom with cooperation and autonomy with synergy.” As CEO Terri Kelly put it in an enjoyable talk at MIT (link provided in the Further Reading section for your viewing delight at another time – or even NOW!)  “Associates vote with their feet”.

Utterly brilliant.

What does the 20th century manager say to this? ‘Pah! Must be like herding cats’ and reaches for her latte with a patronising disdain. Yet when so many organisations complain about their silos and their lack of collaboration, surely a little more fluidity might help? Isn’t this how the future looks? People, us, gravitating around the initiatives and projects we feel passionately need to happen?

Coaching

A quick note reinforcing the earlier point about coaching: Gore is small on Management with a capital M, and BIG on coaching. As we’ll look at later, Leadership in Gore is defined by ‘followership’ – if you don’t have an organisation mapped out beneath you, what do you have as a manager or leader? Influence. And every Associate (not employee, as they are keen to point out) at Gore has a Sponsor – that is, someone responsible for their success and usually someone outside of their day-to-day project work. This creates a big coaching culture.

‘Culture eats Bureaucracy for lunch

In her MIT talk current CEO Terri Kelly spoke throughout about the tension between the Gore culture and bureaucracy, and how their goal as the environment has become more complex is to keep driving out bureaucracy. Kelly also made the point that “with the right people, a few clear objectives and guidelines you don’t need a lot of rules”.

There is the famous quote from management theorist Peter Drucker that ‘culture eats strategy for breakfast’. I propose a second: ‘culture eats bureaucracy for lunch!’.

NixonMcInnes

NixonMcInnes is the company that I am part of and helped found with my co-founder Tom Nixon. Like any organisation, we have very many flaws and we do lots of things very badly. I do not include us to present us as the finished article in any way – we are a small, focused consultancy just trying to find our own way in the world. However, if there is an area I do feel we are relatively good at, and that is the People bit, so with this caveat made, it felt relevant to share two of our less usual people practices.

Church of Fail

At a company away weekend in a farmhouse we’d hired in the Welsh hills, we split into groups to work on the company culture by developing initiatives that would not only benefit our company but also our clients’.

One group designed a little process to work on the idea of celebrating failure in NixonMcInnes. They developed the seed of their idea based on a stagecraft exercise that Matt Matheson in our team had experienced in his improv work to teach novice improvisers to accept applause and become better accustomed with feeling uncomfortable.

Out of this was born Church of Fail: a bizarre but powerful cultural ritual in our little company. Once a month, the boardroom at NixonMcInnes is converted into a non-denominational (!) church – with the chairs laid out in rows, all facing to the front where a sign of paper marks the ‘comfort zone’. On the wall behind the congregated audience is a poster with three instructions on it:

1.    How did you fail?
2.    What did you do about it?
3.    What did you learn?

One by one volunteers – and the whole thing is a little whacky so it definitely has to be voluntary – members of the group walk to the front, stand in the comfort zone and, looking at their peers, describe a time that they failed in the last period. Having described their failure, the congregation begin to cheer and clap loudly. It is both incredibly uncomfortable to be stood there at that moment and enormously amusing seeing your colleagues whooping and clapping uproariously at the best (i.e. Worst) failure you could remember. As much as the confessor wants the moment to end, so the applause continues way beyond the point of comfort. And then, when the group sense enough has been done, it tails off, and so their turn is done and it is on to the next volunteer.

What we hope this does is change our own perceptions of failure over time. It is hugely cathartic to socialize your biggest fail of the previous month in front of your peers, and I imagine it is good for our people to see all of us – regardless of our supposed importance or length of service – stand up and discuss our failures.

Communication Workshops

Another practice that we ran for about eighteen months was a rolling programme of Communication Workshops. Conceived and delivered by our excellent Finance Director Lasy Lawless who is also a trained therapist and our wise Chairman (now Non-exec) Pete Burden who has been working with and prototyping progressive business practices his whole career, these sessions were fairly simple in structure.

The group, again made up of volunteers, sat around in a circle in a private meeting space (for us, the boardroom). There would usually be 10 or so people, and Lasy or Pete as the facilitator would introduce  the basic ground rules and the ‘Three Core Conditions’ that we wished to practice:

•    Respect – for the other person as a human being, regardless of their behaviour
•    Empathy – experiencing the world as another experiences it (putting oneself in the other’s shoes)
•    Congruence – being appropriately open and transparent about one’s own thoughts and feelings.

With these principles in mind we would practice this ‘conscious communication’, talking as a group about awkward incidents and issues that had come up and how they had made us feel. If it sounds a bit like group therapy, it probably was but I really cannot say as I’ve never done therapy! (Not yet, anyway).

Over time, the groups fizzled out – I think this was for two reasons: that we all found them a bit weird in a work context and that overlap never felt entirely comfortable; and that they had to some extent served their purpose – everyone in the team has got better at communicating honestly and authentically. For some people, that is just little changes in how they speak and how they listen, and for others it has helped make big improvements in their communication with people at work, particularly under stress. For my part, I learnt lots and am glad we did it. I just need to remember to apply it!

Measuring happiness

Clearly one of the challenges for big business is to measure its contribution in more than financial terms alone. However, even for more progressive businesses there is a prickly challenge – especially when there is greater transparency around the company’s finances – which is that the more open the financial data, the more powerful and influential that data can become.

Imagine a company where every Monday morning every single team member is told exactly how much profit/loss the company stands to make that month and that year, how much cash is in the bank and therefore exactly what shape the company’s finances are in and what that means to each individual. For better or worse, that is what happens at NixonMcInnes every Monday.

It can be a horrible way to start a week. In our own efforts to balance the financial aspects of the business with other equally vital considerations we measure happiness every day.

Quite simply we have three buckets – one full of tennis balls, and then two buckets which start every new day empty: a happy bucket and an unhappy bucket. These are by the door to our office, and on the way out at the end of each day you pick up a ball and toss it in the bucket that best reflects your day. Simple.

On the door is a sheet, and we fill out the number of happy and unhappy balls every day as the week progresses. Anyone can count them up, it’s a pretty straightforward system. And then our office manager adds them to a spreadsheet. We now have happiness data going back to June 2010.

We believe this matters. We believe that in creating a currency around our mood, we put a marker down – it shows that it matters, it gives us a point of reference for discussions in teams and as individuals. It also provides a powerful self-awareness check: ‘why am I putting another ball in the unhappy bucket? What’s going on? What do I need to do or who do I need to talk to?’.

And for me as a manager it’s like a spring in the stride or a kick in the gut the minute I walk in the next morning. As I write this on a Sunday morning I see that on Friday we had 30% of balls in the unhappy bucket – that is not normal for a Friday, and I’m now conscious of it. I have realtime feedback about my team’s wellbeing, their mood – and I cannot hide from it. It is ambiently transmitted, for better or worse. It forces me and all of us to act (or to consciously choose not to).

How was that? Please provide feedback: via comments on this post, via email to wmcinnes@gmail.com, tweets @willmcinnes #cltrshck (no vowels, we’re crazy like that).

The next extract breaks down 5 or so practices that you – the reader – can implement in your organisation; finishing with a really practical ‘how to’.


Thank you!

4 comments

  1. Paul Hutchings (@KindleResearch)

    I think you’re absolutely right to talk about NM but I wouldn’t talk it down as much as you do. You are going to be more aware of any flaws, feel the impact of them and I suspect a more honest/ less evangelist account from Zappos and Gore would throw more light on their problems than they choose to talk about. Nothing’s perfect, especially when dealing with people, so good to recognise it. May even be good to say what they are more broadly than any difficulties you’ve had with the 3 initiatives you talk about – your insider’s view gives you unique insight to share the downsides more rather than the vague and worrying (also inaccurate) impression that you have very many flaws and doing lots of things very badly.

  2. Pete Burden

    Nice section Will. Very interesting on Gore etc.

    Just to remind you, the communication workshops – like Church of Fail – also started at a retreat – I think it was at Charleston. And those followed a series of communication workshops that we ran at Vivid’s offices off the Old Steine – on listening, blocks to listening etc. That was followed by more similar stuff at Alfriston. And on.

    So you’re right while the comms sessions in the office did fade away the skills had been embedded – at least up to a good level. I’d call the comms sessions more about practising the skills.

    The point I think you are really making (perhaps) is that the company invested in communication skills – and particularly in making sure people knew how to communicate with each, give feedback, have conflict etc. This in my view relates closely to empowerment – people are disempowered if they can’t communicate what they want to say – viz “freedom of speech”.

    I also agree with Paul’s comments.

  3. ronanharrington

    Really interesting post. Some thoughts.

    Work is an environment primarily defined by constraint. While the aspiration is to find your love and engage in work that is an expression of your self, for many it isn’t and for most it’s the exact opposite. It’s a place they rather wouldn’t be but are forced to by economic necessity. As you said, the logistic machinery of Zappos is hardly inspiring! Within this paradigm I think companies have a duty of care to their employees. They must create stable and empowering environments where people can be free and grow. Yes because it makes sense to the bottom line but mainly because it’s the right way for a person / entity to behave when they know better. The major problem is that even when we enter into this discussion there’s a false dichotomy created between us and them. ‘Us’, the company, the executive team, who strive for profits and marshall resources to achieve this end, and ‘them’, the workers, playing their part in the process by realising the production of value. (I must point out that I’ve worn both the ‘us’ and ‘them’ hats) . Positive interventions are so often viewed as an input (employee investment) to create an output (maximise productivity, foster commitment, facilitate creativity, etc) rather than experimentations in creating better models for a better workplace environment for all. When companies are run on collective consideration (starting with the employees, then customers, suppliers, community) you start to create concentric circles of value that emanate outward and bring value back into the organisation in turn. The companies that you have continued to highlight are those that are characterised by a belief in this holisitic type of value. Providing value in every action they do, and not just in the discreet product offering as a remote output.

    A really interesting issue that you touched on and that a lot of big organisations are completely unself aware of is the cringe factor associated with these well meaning endeavours. While most examples you raise are a breath of fresh air in organisations where the last thing you speak is your mind, I can imagine many employees rolling their eyes to heaven. For example, the reply all hat at Zappos. Yes it’s good that an organisation acknowledges the elephant in the room but having a song and dance about it? I can imagine that being nauseating and a tad maniacal after the third time. Am I alone in this? I think perhaps the difference lies in organisations who adovate a very americana self help ‘smile or die’ culture and those who accept that work is sometimes shit and that while we’ve good days and bad days we should always strive to make the best of our (working) lives.
    On this there’s a great Shakespeare quote from King Lear that captures this: “How far your eyes may pierce I cannot tell. Striving for better oft we mar what’s well”. That’s why the Happy Bin is ace because it’s an agency making transparent it’s commitment to a difficult and ongoing journey rather than saying this is a place where everyone’s an a priori happy family.

    I worry when companies stray into the ‘family’ territory. Yes you want to create a tribal atmosphere that is characterised by camaraderie but is it the role of work to become this all absorbing institution? What about people that don’t want to bother with the cultural project of the brand and just get on with their job? Obviously you don’t want outright cynics and assholes but is there a value in someone who can see the emperor’s new clothes? Is this not the meaning of diversity? If it is to be the case then the family has to be viewed in real terms. Not the family which has the ‘five values’ that we all buy into but the organisation that shares a commitment to a cause that is authentic and inspiring, that makes human relationships work despite their ever present complexity, and that acknowledges the inevitable tension of high pressure environments.

    Two great reads that give some opposite perspective and some great insight are the Mezzanine by Nicholson Baker and the chapter on work in The Age of Absurdity by Michael Foley.

  4. Pete Burden

    Great comments Ronan – very much agree on them/us.

    Also brilliant to highlight the cringe and family factors. This is definitely something to add in Will if you can – good practical stuff for those that follow.

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