The four companies described in previous posts (Semco, Morning Star, Nucor, Haier) each successfully managed to thoroughly transform their organization through self-management and reap the benefits thereof. Interestingly, these four companies differ in size, sector or activity, country of origin and private or public ownership. And only one of the four, Morning Star, has been working this way since its inception.
So, what can we learn from those four cases?
Concept generally applicable
The concept of self-management is not tied to the size of a company, the activity or the location / country. In other words, one cannot claim that it only works for a certain type of company.
Independent basic principles
A number of basic principles or characteristics return each time or are present in every case. These principles are therefore presumably independent of the company:
Key role for CEO
What clearly emanates from the examples described is the key role the CEO fulfils in introducing and - above all - keeping alive this way of working. And – most interestingly – the Nucor-case demonstrates that it is possible to pass on the vision to a new CEO, particularly when that person comes from the same organization and is therefore familiar with the way of working. It is therefore a key responsibility of the CEO to ensure that both the philosophy and the way of working become deeply anchored in the organization so they are independent of who takes the lead.
Easier from the start
Implementing self-management in a new organization is more straightforward because everyone starts from a similar vision. Introducing self-management in an existing organization deeply affects the organization’s structure and culture. Inevitably, such a process will require more time. In any case, a step by step approach is recommended, supported by a serious commitment and willingness from all parties involved to work in a fundamentally different way.
Not everyone’s cup of tea
Some people do not feel at ease with this way of working. Those who like hierarchy, giving instructions or exercising power over others, quickly moving up the corporate ladder or whoever likes to avoid responsibility, cannot thrive in this climate and will sooner than later (have to) leave the organization. An example of radical communication in this context is the mail that Tony Hsieh, founder of Zappos, wrote to his 1,500 employees in 2015. He gave them six weeks to decide whether they wanted to get involved in the Holacracy variant of self-management that Zappos had been experimenting with. Those who did not want to stay were given a severance bonus. Eventually 18% of the employees opted for the latter but Zappos had the rest on board to proceed.
Continued support from shareholder crucial
What one cannot infer from these cases - because the situation did not occur - is how important it is to have the support of a stable majority shareholder for this approach. Because there are examples of companies (e.g. Origin, FAVI) that had been working in this innovative way until a new majority shareholder arrived who was either not familiar with the philosophy or who was not supporting it. He then re-established the old command & control method thereby cancelling the innovative self-management approach.