Can ROWE and 20% Time Help your Company Through the Recession?
This is not the time to freak out. It’s a time of reflection and introspection for companies and individuals. It’s a great time to ask, “why are we here?” Are we in the right market? Are our customers delighted with our products and services? It’s a great time to do research and design, and it’s a great time to start something new.
If your company spends most of its efforts reducing costs, it might not survive. Granted, reducing costs and keeping them in line with income is a sound business practice. As long as you’re not creating a stressful workplace for what’s left of your employees. Cutting costs is a short-term fix. It will help that quarter’s earnings, but it will not make or break the company in the long run.
So what things can a company do now to get through the recession? How about hiring some fantastic folks? With so many people unemployed, talented folks are looking for work. Hire them and find something interesting for them to do. It seems counterintuitive to hire in a down market, and it certainly won’t lower expenses in the short term, though it’s a hirer’s market, now is a great time to find new talent. Getting the right folks on the bus is just as crucial as getting the wrong ones off the bus. One great way to do this is to institute a Results Only Work Environment (ROWE). Doing this will increase productivity and employee engagement while dramatically reducing turnover. Yes, this works for sales organizations as well. One of the hallmarks of a ROWE is that it becomes readily apparent who the performers/nonperformers are. Results measure everyone.
Invest in R&D. Right now. You should be positioning yourself for what happens when the market goes back up. INNOVATE! What better way to motivate those new hires than to roll out 20% time? Let your employees work on whatever they want 20% of the time as long as it’s unrelated to their normal jobs. At least consider 5% or 10% time. This is where the Post-It Note and Gmail came from.
The importance of transparency cannot be overstated. Uncertainty about one’s fate is stressful. Let your employees know what’s happening with the company and encourage them to participate in challenges. Semco, a Brazilian company, let’s the workers they plan to lay off participate in the process. This increases employee loyalty and decreases stress around layoffs. According to Victor Frankl in his book Man’s Search for Meaning, the most harmful thing to concentration camp victims’ hope was not knowing when their captivity would end. It’s more stressful to show up to work every day wondering if this is the day I get the ax than to know I have six weeks until my job ends. I went through the layoff saga 18 months ago, and it was hell.
So stop spinning, take stock and make changes that help your company and customers. Prepare for the next upcycle, and don’t lose sight of your employees' importance. Don’t make the mistake of thinking you have a captive audience, so you don’t have to make an effort. If you do, you might find your retention bottoms out when the economy recovers.
ROWE and City Planning
If more and more people start working from home, what effect will that have on our cities and communities? Will our need for office space decrease? Will traffic lesson, will we need fewer parking spaces in business districts? Will it strengthen or weaken our relationships at home or work? Certainly, there will be consequences for changing the way we work. Some of them intended lower costs for office space, and higher employee engagement and satisfaction, and some of them were unintended. What will the unintended consequences be?
I went to an unconference a few weeks ago that was focused on Gov 2.0 here in San Francisco, CityCampSF. I learned a few things and met some interesting people. Among them is a local city planner. We met for coffee today to talk about how ROWE and telecommuting might affect the workplace regarding workspace and city planning. It was an enlightening conversation!
It never dawned on me that we might have to start planning our cities around these changes in work life. Since cities plan 20 years into the future, it’s time to start planning now. What will cities look like when most people can choose where and when they work? Will it change how we build living spaces? Will life become more centered on neighborhoods? Will we see more multipurpose shared workspaces being built?
In his book, The Seven-Day Weekend, Ricardo Semler says, “Working away from the office is an inevitable part of our future. In 1990 only 4 million people telecommuted from home or somewhere else in the US … in 2000 there were 24.6 million telecommuters.” Semco decentralized its office system. They now have satellite offices instead of large central offices. Semler predicts that as people get used to the idea and as technology evolves, the satellite offices will also go away.
If you’ve been working on this issue or have some insights, I’d love to hear about it. What will a ROWE city look like?
Unarticulated Needs
Filling needs that people don’t know they have is hard. Earlier this week, I read a blog post that Seth Godin wrote about: Marketing to the bottom of the pyramid. It got me thinking that that’s what I’m trying to do, fulfill unarticulated needs. Needs that most folks don’t know they have. The average person doesn’t know that they could have a work-life that lifts them up and makes them feel great. For the last 100 years, we’ve been programmed to believe that work is a necessary evil, that we need to give up 40-60 hours of our week to purgatory, and that being happy, fulfilled, and engaged at work is more of a fairy tale than a reality.
A handful of companies are practicing new ways of managing companies and people that give people dignity, purpose, and self-determination at work. I know that the tenants of Motivation 3.0 work because of the success of these innovative companies. Companies like Semco with a 30-year track record of success. Yet most of the time, when I have a one-on-one conversation with someone about how companies are increasing productivity by way of empowering employees, what I get back is, “That sounds great, but it could never work at my company. “
There’s an upside and a downside to trying to sell ideas people don’t know they need. On the upside, it’s an untapped market with unlimited growth potential. On the downside, the market has to get created. This is in part, the purpose of this blog, to help spread the ideas of autonomy, mastery and purpose. At the bottom of my pyramid are the millions of workers who don’t know that there is a better way that they can make a difference, if not for themselves than at least for their children. It could take a generation for these ideas to find the tipping point. Like my dad always said, “Nothing good ever comes easy.”
Zappos: Happy People, Delivering Happiness and Shoes.
Tony Sheih, CEO of Zappos, has just written his first book,‘Delivering Happiness, a Path to Profits, Passion and Happiness.’ It chronicles Tony’s life, from childhood entrepreneurial efforts to college and his time at LinkExchange. In some ways, it reads like Ricardo Semler’s‘Maverick, The Success Story Behind the World’s Most Unusual Workplace,’ Both books talk about lessons learned, mistakes made, and happy coincidences that lead them to success.
What is Zappos? It’s not a ROWE (Results Only Work Environment). It’s not democratically run, like Semco. Zappos does manage to keep its employees very engaged. Engaged employees result in growth and profits by way of creativity and innovation. The management, led by Tony Sheih focuses on the company culture and delivering happiness.
Zappos has a Culture Book it publishes every year. Everyone who works with or for Zappos is encouraged to contribute to the book describing Zappos culture. They publish all comments and only edit for typos, so the good, the bad, everything gets published.
Zappos does use carrots and sticks, though in a way that employees can control. You can take classes that will bring you to the next career level, and after taking them, you get a small raise. You can take them at whatever speed you like or not at all. Employees are empowered to do their jobs in whatever way works best. There does seem to be a large amount of autonomy. If you look at the Zappos Core Value Document, it’s obvious that they focus on mastery as well:
Create a fun, creative work environment where people are largely self-directed, are encouraged to get better at what they do, and acquire new skills, combined with being a part of something larger than themselves and the result is growth and profit. While Zappos may not be a new business model like ROWE, Results Only Work Environment, it is game-changing.
Their purpose is their culture and delivering happiness. They’ve put most, if not all, of their marketing dollars into customer service, letting their customers be Zappos marketers. This approach is one of the cornerstones of Zappos’ success sounds like it came out of Seth Godin’s playbook. Check out www.deliveringhappinessbook.com. Tony is trying to start a movement.
Are you a stone cutter or do you build cathedrals?
Ricardo Semler took his company SEMCO from a four million-dollar-a-year venture with one division to 212 million yearly with 15 divisions. From 1982 to 2003, I couldn’t find any newer numbers, but at that time, his staff was aiming for 1 billion dollars by 2008. Sales have an average growth of 24% a year and SEMCO has less than a 1% turnover. Beat that Wall Street!
Ricardo has some very unconventional ideas about how to run a company. Things are run democratically. Everyone gets one vote, even Ricardo himself. If someone calls a meeting on a new idea or business proposition and no one shows up, or the people that do show up think it’s a bad idea, that’s it. Regardless of whose idea it is. All SEMCO employees are taught how to read financials and are invited to participate in the twice-yearly budget process. Employees set their hours and salaries. Then there’s the board of directors: they keep two open seats that any employee can sign up for, and they are board members with a vote for that meeting.
SEMCO doesn’t have rules, Standard Operating Procedures, or many policies. It’s left up to employees to use their common sense. This is the closest thing they have to an HR manual: SEMCO Group Survival Manual. It aims to create a common language and help people go in the same direction. From Maverick, “There is another less obvious dividend to the banishing of rulebooks: people begin to make more decisions on their own, decisions they are better qualified to make than their supervisors.” That’s something I learned while working for Xerox, let the people closest to the customer make decisions that affect the customer.
In his book Maverick, Ricardo says, “We simply do not believe our employees have an interest in coming in late, leaving early, and doing as little as possible for as much money as their union can wheedle out of us. After all, these same people raise children; join the PTA, and elect mayors, governors, senators, and presidents. They are adults. At SEMCO, we treat them like adults. We trust them. We don’t ask for permission to go to the bathroom or have security guards search them as they leave for the day. We get out of their way and let them do their jobs.“
He tells the parable of the stonecutters in Maverick:
Three stone cutters were asked about their jobs.
The first one replied, “I’m paid to cut stones.”
The second replied, “I use special techniques to shape stones in an exceptional way. Here, let me show you.” He proceeded to demonstrate.
The third just smiled and said, “I build cathedrals.”
Ricardo wants a whole company of cathedral builders. He says, “The purpose of work is not to make money. The purpose of work is to make the workers, whether working stiffs or top executives feel good about life.”
Where do I sign up?
