Sunday, July 20, 2008

Organizational Change is like Sausage

Eric D. Brown wrote a short post on his leadership organizational change blog. While I understand the sentiment, I don’t really draw the same conclusions.

I hear a lot of other folks say many of the same things about the way the tools of leadership and change management make them feel. This often reminds me of Samuel Clemens' quote about how "[t]hose who respect the law and love sausage should watch neither being made." Organizational change and true leadership cannot be apolitical simply because they fundamentally are about dealing with people and their varied interests.

His primary complaints about the book he read is that it appears to be giving the reader advice on how to play the political game to manipulate people into doing what you want. When put that way these things really sound pejorative. However without further context it is hard to tell. Motivation for manipulation is critical to understanding the ethics of persuasion, just ask the mother of any two year old trying to get them to eat something "good for them".

It is all fine and good to say that a good leader “should already have people aligned with the necessary changes and have them ready to implement change.” But how does the leader do that exactly? Well, one way is to create a sense of urgency. To say that if a leader is doing their job a sense of urgency already exists is just plain silly. That implies that a leader doing their job has created a sense of urgency. But that’s exactly the advice Eric appears to argue against.

Further, Eric posits that organizational change should be about changing the game not playing it. But implementing change within an organization in a smooth and orderly fashion requires that you work within the existing structure to gain support for your change. This is particularly true if the change is to the game itself.

The “political acumen” and “art of persuasion” that disturb him are simply tools in the toolbox of a good leader. A good leader without political acumen will get eaten alive by some jackass that out flanks them in the executive ranks. A jobless leader is not particularly effective. A good leader without mastery of “the art of persuasion” is an oxymoron since a good leader persuades (not forces) people to follow them, even when the way forward is unclear or difficult.

I suspect that there was something else about this book that set off Eric's alarm bells. I’ve had this happen several times with books where the advice they were giving was clearly “good” yet I hated (and hate is not too strong for how I felt about some of them) something about it. The tone, the subtext, something set me off. I’ll bet if Eric looks closer he’ll discover the same thing.

Eric has many great posts about change management and leadership and I think he understands how technology fits into and can help drive the very changes he advocates (that's why I read his blog). But I think that like a lot of other people before him, he went off track on this one.

Thursday, July 17, 2008

Building Organizations without Managers

Today I'm posting a guest post from Jon Poland. I met Jon at the first BarCampSeattle where I was one of the organizers. Jon has spent quite some time thinking about organizations and how the people inside of them interact. This post raises some questions that would be rather uncomfortable for most organizations.

When Jon talks about organizations without managers he is not talking about organizations without leaders. Leaders are the people you follow, managers are the people who tell you what to do. Sometimes they are the same person... if you're lucky.

Over to Jon...

Turning the Organization Inside Out
A Model for Hyper-Innovation

Jon Poland – 3rd i

What is the chief reason that people fail to perform to their fullest potential?

I believe that it stems from a lack of motivation/inspiration. I believe the root causes are limited choice about the work they do and an inability to provide input into how their work is done. Employees also are forced to roll the dice on whether their manager is good to work for and can/will serve as a beneficial mentor/coach. On the flip side, some managers are not comfortable dealing with problem-employees directly and the whole team/organization suffers as a result.

This makes me ask the question: why do we need managers? In fact, why is a multi-tier hierarchical organization necessary at all? The answer that typically comes back is that the organization needs direction/leadership and that employees require overseeing or they won’t do their jobs properly, if at all. But what if these functions could be accomplished more effectively without a top-down structure?

All organizations need rules to operate by. Rules create order out of chaos. But rules – if overbearing, improperly applied, or treated like dogma without an understanding of the reason for their existence – can crush the soul of an organization’s employees. So we will pay careful attention to the rules that are developed for this new type of organization. Also, people need a purpose in order for their work to be meaningful, which can be expressed as an organizing principle. This principle should inspire people to come to work and act as a touchstone. The organization must live this principle in order for it to be beneficial.

Here are the proposed 12 Rules for Organizations without Managers:

Rule #1: No one can be made to work on anything they don’t want to and they get to choose how they want to do the work. This restricts one person from imposing their will upon another. People in this company will be self-managed.

Rule #2: People can work on projects or in professional groups with no more than 80% time allocated to any one project/group, no more than three projects/groups per person, and a minimum of 40% total allocation. People who can’t achieve minimum allocation are automatically dismissed after two quarters. Professional groups include accounting, HR and legal. People have the flexibility to work on different things so that their minds get enough stimulation, but without getting spread out too thin. Maximum 80% allocation to any one project/group encourages cross-fertilization between projects/groups. Minimum 40% total allocation gives employees flextime opportunities (school/family/health) while still making their contribution significant enough for the company to have them.

Rule #3: Anyone with an idea for a project can champion that idea within the company and recruit others to participate in the project. The project must have at least 6 members to be considered a project (no compensation for allocated time until then). The person(s) with the forming idea own 10% of the project (split according to their agreed upon percentage contribution to the idea) which translates into 10% of the profits generated by the project or 10% of the cost savings generated by the project (convertible to stock in the company per an agreement between the idea owners and the executive team). This encourages entrepreneurship within the company and rewards people for their IP contributions.

Rule #4: Anyone in the company can become a member of a project/group if they have three sponsors from that project/group. The amount of time they can allocate to the project/group is determined by the sponsors. An exception is that the idea person alone can recruit a new member if there are less than 5 people on that project. Another exception is that the executive team can appoint people to professional groups if a group is smaller than three members.

Rule #5: A person’s contribution is determined quarterly by 5 people they work closely within each project/group. People are rated anonymously on a likert scale based on their level of effort, mastery, mentorship, collaboration and attitude. The standard salary for all project members is the same (set by the executive team), but people with above average contributions make up to 100% above standard and people with below average contributions make up to 50% below standard. The standard pay for each professional group is set according to the industry average. People who are new to a project start at the standard salary until rated. Professional groups smaller than 6 people will need to fill the gap by getting rated from people they work with who are outside that group. Ranges are to reward higher contributions and to encourage underperformers to perform better or leave.

Rule #6: Anyone can be dismissed from a project/group, including idea owners, by a majority of the people who rate them (done anonymously). Idea owners retain their ownership rights described in rule #3. In addition, a professional group can dismiss an employee outright by agreement from three people in that group. If someone has violated HR policy or accounting rules, that profession is in the best position to make the judgment call.

Rule #7: Employees who have been with the company for a year split quarterly profit sharing evenly. Profit sharing is 20%. Yes, that’s very high compared to other companies, but it provides a strong incentive for every person to make the company profitable (and remember there is no managerial overhead to pay).

Rule #8: Executives are appointed by the board, but must be ratified by the employees and can be dismissed by a majority vote of the board or employees (done anonymously). Executive pay is 5X the company average with the CEO making 10X. The executive team can propose major company initiatives, but initiatives must be approved by the employees by a majority vote (also anonymous).

Rule #9: People who average in the top quartile of contribution for the last 4 quarters are eligible to be recruited by the executive team into the Front Office Group (FOG). The FOG supports the executive team. The rules that apply to this group are the same as for project groups (except they can’t propose project ideas). Their standard rate is 3X the company average. By agreement from three members they can disband any project they (1) suspect of being a hideout for underperformers, (2) feel is not in alignment with the company’s organizing principle, or (3) feel has reached a dead-end and won’t self-disband. People who were on two such projects within a one year timeframe are automatically dismissed from the company.

Rule #10: The total company budget (determined by the executive team) is distributed across employees in proportion to their salaries and assigned to projects/groups according to percentage time allocated. If a project/group has more budget than they need, they can assign the overage to other projects/groups that need it. Because of 20% profit sharing, hoarding is unlikely.

Rule #11: Project/group members let HR know which skill sets are needed. HR must at a minimum conduct background checks and verify resumes for promising candidates before letting them in and will let a few more candidates in than are technically needed for that period. It’s up to new hires to get onto projects/groups at the percentage allocation they prefer. This rule along with all the other rules will be disclosed to candidates up front. This gives more people a chance to work at the company and weeds out under-performers quickly.

Rule #12: In addition to sick/vacation time, everyone gets one week PTO for expanding their horizons, whether reading, going to seminars/conferences/training, etc.

All this assumes that there is money to pay employees. A bootstrap startup company could do without an executive team or FOG early on (and forget about budget). It could offer a higher share of project ownership, and relax minimum percentage allocation to encourage people to work there part-time as a second job until the company is in a position to pay them.

A company set up in this way would release people’s potential to be highly innovative as well as productive. It would be an exciting place to work.

Jon Poland is the founder of 3rd i Designs which provides an online set of tools for organizations to conduct faster/cheaper/better strategic planning. He is also working on an online application for organizations, communities and societies to participate in collective decision modeling. The ideas for this paper were inspired from his master’s degree in entrepreneurship work and from a BarCampSeattle session hosted by Bruce P. Henry on gaming the organization.

Friday, July 11, 2008

How to: Disable Windows Update Restart

Okay, I normally don't do tech how to posts simply because they're usually already posted and easy to find. This however took me awhile and it is so vexing that windows automatically restarts at the end of a critical update that I thought I'd share it around.

If you're super-technically adept, skip to the end to see the registry hack way of doing this directly.

Windows Update is generally useful. I like that it automatically patches my OS with all the latest security stuff. If you want to know why I like this please take a look at this article on herd immunity and then take a couple of minutes to think about it.

Anyway, the vexing thing is that at some time around 3am, when I am never there to tell it, "oh hell no, I have critical documents open!" Windows rolls an update and the computer helpfully restarts itself. Here's how to fix that little issue without turning off automatic updates in XP pro (for home edition you must hack the registry).

  • Go to Start Menu -> Run type “gpedit.msc” and press Enter
  • This opens the Group Policy editor
  • In this window go to: Computer Configuration -> Administrative Template -> Windows Components -> Windows Update
  • Double click on No auto-restart for scheduled Automatic Updates installations
  • In the settings window Choose Enabled and click OK
  • Close Group Policy Editor

The next time Windows Update updates your system it will not restart the computer automatically, but will notify you that restart is needed in order to finish the installation.

Now for the registry hack way (small children and sensitive individuals should avert their eyes).

  • Go to Start Menu -> Run type “regedit” and press Enter
  • This opens the Registry Editor (if you are not sure of what you're doing STOP because you can completely hose your computer if you screw up)
  • In this window go to: HKEY_LOCAL_MACHINE -> SOFTWARE -> Policies -> Microsoft -> Windows -> WindowsUpdate -> AU (if this key does not exist you must create it)
  • Create a DWORD named NoAutoRebootWithLoggedOnUsers with a value of 1

That's it! Again, the next time Windows Update updates your system it will not restart the computer automatically, but will notify you that restart is needed in order to finish the installation.