Saturday 3 December 2016

How tech is making your middle manager tricks obsolete

Published 12/07/2015 | 02:30

Zappos CEO Tony Hsieh: 'We're trying to switch from a normal hierarchical structure to one which enables employees to act more like entrepreneurs and self-direct their work instead of reporting to a manager who tells them what to do'
Zappos CEO Tony Hsieh: 'We're trying to switch from a normal hierarchical structure to one which enables employees to act more like entrepreneurs and self-direct their work instead of reporting to a manager who tells them what to do'

Imagine working in a company with no boss and no job titles. A place where senior decisions are made by anyone working on a project. To Audi-driving Irish executives, it's a bizarre notion. No office, no Linkedin page, no subsidised leather-cased iPhone.

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Yet this is exactly the management approach that tech companies are now taking.

In the US, they even have a term for its most thorough implementation: holacracy. There, companies such as online shoe-retailer Zappos now have no management hierarchy. Decisions are not delegated, but are made by whoever is working on a particular issue at the time, with full autonomy.

"We're trying to switch from a normal hierarchical structure to one which enables employees to act more like entrepreneurs and self-direct their work instead of reporting to a manager who tells them what to do," said Tony Hsieh, Zappos founder. (Holacracy still allows 'founder' as a title.)

In practice, this means a series of working groups with ultra-connected, organised workers.

Sound soft? Think again. Where Irish executives might sniff at a radical commune, holacracy (and its umpteen variants) has zero tolerance for slackers: by definition, everyone must pull their weight, all the time. This means no sneaking off to play golf 'on a sunny Friday'. And no jargon-filled emails substituting as work.

Hsieh, who calls holacracy a "new operating system", told staff that they would need to switch off their 'reporting to' culture and migrate to new 'silos'. He even offered three months' pay to anyone who didn't want the new system. (One in seven of the company's staff subsequently left.)

Hsieh isn't the only one engaged in this. Fast-growing companies such as online blogging platform Medium also operate on a 'flat' management basis. Organisations such as Wikipedia have long done so. While some call it holacracy, others call it 'wirearchy' or 'lateral' management.

In Ireland, too, tech firms are far 'flatter' than other industrial set-ups. Engineers and coders are almost always the functional equals to founders or financial controllers in fast-growing start-ups here that I see.

While some of it is rooted in the need to actually collaborate so that products get built, a different stimulus comes from the engineer's obsession with striving toward zero defects in any structural process.

In this case, it is bloated middle management that has been identified as a defect in creating a successful, dynamic company.

But with no boss, wouldn't we all just sit around dossing on Facebook all day? Wouldn't we call in sick every Monday morning or try to get out early every Friday afternoon?

This is the scenario a friend of mine, who works in a construction-related company, put to me recently.

His is a traditional Irish management structure. This means that the boss gets a premium parking space and earns around ten times the pay of the person a tier below.

It also includes attitudes where directors regard lower-tiered staff (skilled machinery operators and clerks) as being "lucky to have a job". Junior managers are shouted at, but not as much if their shoes shine brightly. Items such as company stationery are locked away for fear of being stolen.

It's a pretty adversarial, stale environment. And workers respond by taking as much sick leave as possible with little feeling or remorse or responsibility. They also, according to my friend, actually do steal things.

My friend's company barely treads water. When asked why, directors who still earn six-figure salaries blame "the economy" or "taxes".

Would holacracy help companies such as these? Some think not.

"Holacracy, itself, is too complex, dogmatic and rigid," says Bud Caddell, a well-known US management consultant. "It feels like playing a game of Management Dungeons and Dragons. Everything you already understand about working in teams is reinvented with confusing language (such as circles, tensions and IDM) and a confusing process. Teams should operate in ways that feel natural for their culture."

But perhaps we could all use a little more lateral culture in our companies. In Dublin's Facebook office, when staff need new high-end tech accessories, they just go up to a cabinet and take one. No one thinks they will steal it. Because they're there to get something done: not to add more titles to their Linkedin page.

Sunday Indo Business

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