I read two articles this weekend that I found interesting.
The first was a blog post by Ben Horowitz.
http://bhorowitz.com/2014/01/02/can-do-vs-cant-do-cultures/
I found this to be very germane to large companies attempting to innovate and transform.
To quote one paragraph of the blog:
Big companies have plenty of great ideas, but they do not innovate because they need a whole hierarchy of people to agree that a new idea is good in order to pursue it. If one smart person figures out something wrong with an idea–often to show off or to consolidate power–that’s usually enough to kill it. This leads to a Can’t Do Culture.
Contrast this with another paragraph from the blog:
The trouble with innovation is that truly innovative ideas often look like bad ideas at the time. That’s why they are innovative – until now, nobody ever figured out that they were good ideas. Creative big companies like Amazon and Google tend to be run by their innovators. Larry Page will unilaterally fund a good idea that looks like a bad idea and dismiss the reasons why it can’t be done. In this way, he creates a Can Do Culture.
When innovation is obviously working, it is much harder for the “can’t do” to suppress the “can do.” In many large companies, it is the other way around. Before innovation is obviously working, it is easy to question and criticize. Without counterbalancing forces and a willingness to take risks, new ideas often get killed before they have a chance to succeed.
The second article concerns Zappos. They are changing some of their management practices to eliminate traditional titles and hierarchy with a goal of preventing the company from becoming too bureaucratic as it grows.
http://www.washingtonpost.com/blogs/on-leadership/wp/2014/01/03/zappos-gets-rid-of-all-managers/
The article acknowledges that this is a difficult system to grasp. Yet, it is actually pretty simple. It’s just different from the organizational model of the 20th century that most people are accustomed to.
Let me explain: An easy misinterpretation is that there are no leaders and everybody just does what they want. Who makes decisions? In reality, there are always people who are stronger leaders than others. What this change does for Zappos is to make clear to each individual what they are responsible for. It also makes clear to others what each individual is responsible for. In that way, it makes cooperation more natural and more focused on the important work that needs to be done. By making each “unit of work” (a term I use to describe a project or a business problem) explicit, it clarifies ownership and decision making responsibility.
Changes like this may be hard to understand and they may not work. Yet, unleashing the power of people and developing more leaders, what I call leaders leading leaders, is a 21st century idea worthy of consideration, experimentation and implementation.
Eddie Lampert's Blog 
Excellent points! The best ideas come from the field and are generated based on first hand experience. Do not push down ideas, embrace them. Allow individuals to feel like a part of a team, and you will in-turn create a team.
Both very good articles. I agree 100% on your statement about “leaders leading leaders”. I’ve been with Sears coming up on two years now (SM @ Chicago Ridge) and I noticed very quickly that my leaders did not understand how to grow and develop other leaders. When you are able to create an organization where leaders are focused on developing others to be great leaders and “unleash the power of people” then you can really start to make things happen!
Large companies tend to have lots of layers of management, but these folks are not necessarily the leaders needed to drive the company forward. In fact, as is pointed out these layers of management can kill or inhibit creativity and innovation.
All great articles. Thank you for sharing.
Servant Leadership carries with it great responsibility. Below are the keys to leading and not managing people:
Ten Principles of Servant Leadership
By Robert Greenleaf
1.Listening – Traditionally, leaders have been valued for their communication and decision making skills. Servant-leaders must reinforce these important skills by making a deep commitment to listening intently to others. Servant-leaders seek to identify and clarify the will of a group. They seek to listen receptively to what is being said (and not said). Listening also encompasses getting in touch with one’s inner voice, and seeking to understand what one’s body, spirit, and mind are communicating.
2.Empathy – Servant-leaders strive to understand and empathize with others. People need to be accepted and recognized for their special and unique spirit. One must assume the good intentions of coworkers and not reject them as people, even when forced to reject their behavior or performance.
3.Healing – Learning to heal is a powerful force for transformation and integration. One of the great strengths of servant-leadership is the potential for healing one’s self and others. In “The Servant as Leader”, Greenleaf writes, “There is something subtle communicated to one who is being served and led if, implicit in the compact between the servant-leader and led is the understanding that the search for wholeness is something that they have.”
4.Awareness – General awareness, and especially self-awareness, strengthens the servant-leader. Making a commitment to foster awareness can be scary–one never knows that one may discover! As Greenleaf observed, “Awareness is not a giver of solace – it’s just the opposite. It disturbed. They are not seekers of solace. They have their own inner security.”
5.Persuasion – Servant-leaders rely on persuasion, rather than positional authority in making decisions. Servant-leaders seek to convince others, rather than coerce compliance. This particular element offers one of the clearest distinctions between the traditional authoritarian model and that of servant-leadership. The servant-leader is effective at building consensus within groups.
6.Conceptualization – Servant-leaders seek to nurture their abilities to “dream great dreams.” The ability to look at a problem (or an organization) from a conceptualizing perspective means that one must think beyond day-to-day realities. Servant-leaders must seek a delicate balance between conceptualization and day-to-day focus.
7.Foresight – Foresight is a characteristic that enables servant-leaders to understand lessons from the past, the realities of the present, and the likely consequence of a decision in the future. It is deeply rooted in the intuitive mind.
8.Stewardship – Robert Greenleaf’s view of all institutions was one in which CEO’s, staff, directors, and trustees all play significance roles in holding their institutions in trust for the great good of society.
9.Commitment to the Growth of People – Servant-leaders believe that people have an intrinsic value beyond their tangible contributions as workers. As such, servant-leaders are deeply committed to a personal, professional, and spiritual growth of each and every individual within the organization.
10.Building Community – Servant-leaders are aware that the shift from local communities to large institutions as the primary shaper of human lives has changed our perceptions and has caused a feeling of loss. Servant-leaders seek to identify a means for building community among those who work within a given institution.
I love the idea of the can-do culture. Self-fulfilling prophecy is a real phenomenon so why not use it to your benefit. Creating that culture, hiring to it and letting go those who do not fit is the more difficult thing and it requires full buy-in from upper management. I have always loved that Zappos offers new hires a payout to not take the job as a means of ensuring those who do take the position want to be there.
I also love that Zappos is trying out this new and different organizational style. I believe in the concept of self-managing high performance teams and Zappos are in effect saying that their whole organization will be divided up in these work based self managing high performance teams. This concept also seems similar to a matrixed organization where a project manager leads a cross-functional team and the team members do not report to the project manager but for the duration of the project the project manager does in effect own the resources as they are related to the project. The professional development in the matrix organization would belong to the functional manager that Zappos seems they want to get rid of. I would imagine that at Zappos this professional development responsibility would fall to an HR like resource who could then work with the associate and create a development plan that is truly indicative of where the associate wants to grow along with where the company needs are and will be. So basically Zappos will guard against the rogue, bad leader who will push a group into a direction that may not be desirable for the organization though desirable to the leader. Their biggest issue will be groupthink. If the decisions really are driven forward by the groups it will be less likely that a lone dissenter will speak up in fear that if a group is mobilized in a direction they will be eliminated by the group.
I do think that ALL large companies should consider investing in a division that would be charged with being innovators. I like the model Steve Jobs used with Apple when they secretly developed their early products living in a building across from the main company. These divisions would operate in start-up like, flat hierarchy, culturally driven by one visionary with the goal of developing new, innovative products or processes with high payout possibilities for those involved. The other thing that would come with this This way the “main” organization can focus on continuing to drive the ship forward, making incremental improvement to existing products and improving operational efficiency while the innovative side is busy creating new and innovative products or processes.
The key to this model is keeping this division effectively separate from the rest of the company. This division needs to report to either the company board or no lower than the CEO so that they are not hamstrung by corporate politics or agendas and allows the innovative branch to innovate based on a broader need not just the specific needs of the company itself. Having this division develop its own, start-up like culture and hiring the right leader who will foster that culture.
The great thing with this kind of a model is that once the innovative side has developed something good the company has the choice to sell that innovation, spin it off with separate funding or put it into production using its seasoned resources.
Having said all of hat that I will argue the following: I do not believe that the tradition hierarchical model is the root of all corporate evil and the arch enemy of innovation. Company culture and the leadership driving that culture are the drivers behind how any hierarchy is used. One of the things that Disney does extremely well at Disney World is propagating their “greatest place on Earth” culture. Given the fact that Disney World is the greatest place on earth and you get to work there why would you not be happy. That is the culture and they expect nothing less from ALL of their employees. I think that is phenomenal to set those expectations and act on them as necessary in order to maintain that culture! I also heard from a co-worker whose daughter worked there as an intern and then after going into corporate could not understand why her coworkers were so gloomy and realized how great and prescriptively different the culture was at Disney.
This is not radical thinking and I realize that I did not fully bake the idea in the few short paragraphs above but I am curious to know what you think.
Daniel
All advancements that we take for granted today, were all once considered impossible! When you truly understand this, you will realize that anything is possible…once you figure out how to do it. Most people who have achieved breakthroughs don’t know how hard their journey may be, if they did, they would fall into the trap of thinking that it was impossible to accomplish, or too hard to attempt. However it is usually this naïveté and joy of the journey, that leads them into trying things that others, who are more learned than themselves on the subject/task at hand won’t consider. These are the very things, that if they work, are called ingenious/out of the box and leads others to call the person innovative, but usually it is because they have run out of all other options and refuse to give up on their dream/goal, that they are willing to try almost anything. It also helps if they enjoy the journey as well, do not take themselves too seriously and especially if they can ignore what others have to say about what they are doing.
The Greatest Leaders are those that Begin with the End in mind. Excellent examples and insight.
There are those individuals who are very good at generating innovative thoughts and ideas but are poor at implementation. There are individuals who are “OK” at innovation, but are great listeners and listen to those who are innovative and who are communicating their innovative ideas. These same people are great at taking those innovated ideas communicated by others and implementing them. Then there are those who are neither great at innovative thoughts or implementation. They are productive with day to day support of ideas already implemented and follow others.
The idea is to identify and pair the innovative thinkers with the those that can recognize the idea as being a good idea and have the tools & motivations to implement. At the same time, those who are in position to squash this creation process need to allow these groups to do what they do best.
Great articles; like Ben Horowitz says “Don’t Hate, Create.”
It will be interesting to see if Bezos implements the holacracy at The Washington Post or Amazon.
Something SHC is thinking as well?
-Generating Innovative Ideas-
Have each department create contests with prizes similar to DARPA. Calculate the potential cost savings of the solution, and offer half of the savings in the form of prize money.
Open the contests to everyone within the organization, and perhaps even outside the organization. Participants will choose to join those contests they find most applicable to their skill set and interests. Innovators exist at all levels of organizations (see socket wrench & Peter Roberts).
Below are some links to the paper shredding challenge from DARPA. For $50,000 in prize money, a seemingly impossible task was accomplished on budget and ahead of schedule. Not too bad for a government project….
http://www.darpa.mil/NewsEvents/Releases/2011/12/02_.aspx
Click to access Winning%20Teams%20Submissions.pdf
-Implementation of Innovative Ideas-
The implementation of innovative thought is led by entrepreneurial individuals with the ability to sift through innovative ideas and recognize those which can be successfully monetized. Xerox PARC had great ideas, but couldn’t monetize. Apple monetized those ideas.
The same individuals should be responsible for both implementing the ideas and creating the DARPA style contests. Well designed contests should be quite profitable when completed successfully.
http://www.forbes.com/sites/chunkamui/2012/08/01/the-lesson-that-market-leaders-are-failing-to-learn-from-xerox-parc/
-Performance of Existing Processes-
Until innovation takes place, there are certain boring repetitive tasks within an organization that just need to get done. Imagine a worker on an assembly line pulling a lever at a 30 second interval all day long.
Imagine how boring that job would be after the first few hours pulling the lever.
The factory would need to hire a foreman to monitor performance make sure that worker keeps pulling that lever.
Now imagine that same worker in a casino pulling the lever on a slot machine. All of a sudden the same task becomes much more fun. The worker can’t wait to drive to work and pull the lever. It may even become an issue when the worker sells their house and pawns their jewelry to pull the lever. The worker may even begin to get innovative and wear a concealed electronic device to determine when to pull the lever for the biggest payout.
It’s all about perspective and incentive.