Management free falling! Why The Zappos & Valve Model is Terrifying [Post 4 of 8]

Forth IN AN 8 POST SERIESBRAD SZOLLOSE AND ROB HIRSCHFELD INVITE YOU TO SHARE IN OUR DISCUSSION ABOUT FAILURES, FIGHTS AND FRIGHTENING TRANSFORMATIONS GOING ON AROUND US AS DIGITAL WORK CHANGES WORKPLACE DELIVERABLES, PLANNING AND CULTURE.

It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.  Steve Jobs, cofounder of Apple Computers

Trust, not stability, is the new management contract. Digital workers interpret “strong” management as a lack of trust. Megaphone!

Before we can talk about how to manage digital workers, we have to talk about trusting them to do their jobs. Why? Digital workers largely adopt Millennials’ unwillingness to follow directed leadership.  If we want to succeed in managing them then we need to foster mutual respect that is built on bi-directional trust.

20th Century business models were based on “if you can’t measure it, you can’t manage it” thinking that went along with mass manufacturing control, discipline and predictability. Physical goods were sold to a passive marketplace with minimal feedback from markets and internal workers; consequently, decisions could be made by a few leaders as long as workers did what they were told. All out-of-the-box decision had to go through a leader. The bigger the decision, the higher up that decision needs to go for approval. Like in our symphony analogy, control and discipline is the main ideology.

In 21st Century business, there is no script just as there is no score for a Jazz concert. That does not mean it’s a worker free-for-all! We still need to deliver products. But instead of top-down control, we talk about collaboration, shared mission and team work. This change is critical because digital work as so much situational content that it is impossible to proscribe it’s exact results in advance. Like Jazz, you can create a general framework and guidelines but the exact composition has a degree of improvisation because it must reflect the players’ situation in the moment.

Since you have to trust people to make decisions, you’d better create an environment where they want to make the best decisions for your business!

Glassdoor’s multiyear study discovered that the “Best Places to Work” from 2009 to 2014 outperformed the S&P 500 by 115.6% while a similar portfolio named Fortune’s “Best Companies to Work For,” outperformed the S&P 500 by 84.2%! That is impressive.

What does trust look like? Leading gaming software maker Valve has thrown out the traditional employee handbook and replaced it with a 37 page breakdown of what they expect from an employee. The manual tells people their desk is on wheels so they can just roll over to a new team if they want to change jobs. The trust implied in that type of follow-your-passion enablement is unheard of in most workplaces.

Zappos, recognized 6 years in a row by FORTUNE’s 100 Best Companies to Work For®, pays employees $4,500 to quit if not satisfied with the culture. Zappos CEO Tony Hsieh is advocates for a no management whatsoever model called Holacracy. Like Valve, Zappos counts of their hiring process to find workers who thrive in a self-led model where leadership is fluid and people organize themselves to solve problems and deliver value.

If our undirected Jazz model scares you, Holacracy will terrify you.

However, it’s critical to understand that neither Zappos nor Value are “wild west” work environments. Like a top Jazz ensemble they provide trained performers, concrete structure, appropriate tools and clear expectations. By giving your teams the right tools to know what to do when they are working on their own, you will see a different workforce, striving to make your company better than even you thought possible.

Why does this work? In digital work, we have to give up the idea that the knighted leaders make the best decisions.

It’s not just a question of good decisions, we also need to improve quality and speed of action. Check out Navy Submarine Captain David Marquet’s talk on Greatness, based on his book, Turn The Ship Around! He explains quite well why people should be allowed to think and take responsibility for their work. 

In the end, it’s simply physics. Without trust, all decisions must flow downward and the entire organization is limited by the leadership. Our information economy makes it simply impossible for leaders to sufficiently learn and react. When people are trusted to think for themselves and take control for the products they create there is a psychological shift. They take ownership in their work. That means quality and output go through the roof as they get competitive with creating a wow product.

So, how can you create a company culture that taps into the skills sets of a new digital worker yet engages everyone for the long haul? Let’s dig in and instead of giving you rules or regulations, let’s start with a few principles to create the right environment.

Tune it for our next post: Setting direction – how too much freedom is bad too.

Can Digital Workers Deliver? No. [cloud culture vs. traditional management, post 1 of 8]

In this 8 post series, Brad Szollose and Rob hirschfeld invite you to share in our discussion about failures, fights and frightening transformations going on around us as digital work changes workplace deliverables, planning and culture.

On the shouldersDigital workers will not deliver. Not if you force them into the 20th century management model then they (and you) will fail miserably; however, we believe they can outperform previous generations if guided correctly. In the 21st Century, digital technologies have fundamentally transformed both the way we work and, more importantly, how we have learned to work.

So far, we’ve framed this transformation as a generational (Boomers vs Millennials) challenge; however, workers today transcend those boundaries. We believe that we need to redefine the debate from cultural viewpoints of Boomers (authority driven leadership) and Millennials (action driven leadership). In the global, digital workforce, these perspectives transcend age.

We looked to performing music as a functional analogy for leadership.

In music, we saw very different leadership cultures at work in symphonic and jazz performances. The symphony orchestra mirrors the Boomer culture expectation of clear leadership hierarchy and top-down directed effort. The jazz band typifies the Millennial cultural norms of fluid leadership based on technical competence where the direction is a general theme and the players evolve the details. Both require technical acumen and have very clear rules for interaction with the art form. More importantly, these two extremes both produce wonderful music, but they are miles apart in execution.

Today’s workforce generations often appear the same way – unable to execute together. We believe strongly that, like symphonies and jazz concerts, both approaches have strengths and weaknesses. The challenge is to understand adapt your leadership cultural language of your performers.

That is what Brad and Rob have been discussing together for years and, now, we’d like to include you in our conversation about how Cloud Culture is transforming our work force.

Read Post #2!

Three critical ingredients for digital age relationships. [Collaborate Series 8/8]

Translation: Are you ready to apply these lessons?

This post is the final post in an collaborative eight part series by Brad Szollose and I about how culture shapes technology.

End of LineDuring this blog series, we’ve explored how important culture is in the work place.  The high tech areas are especially sensitive because they disproportionately embrace the millennial culture which often causes conflicts.

Our world has changed, driven by technology, new thinking, and new methodologies yet we may be using 20th century management techniques on 21st century customers and workers. There is an old business axiom that states, “If you can’t measure it, you can’t manage it.”  Yet how much of our process, interaction, successes, and failures never wind up on a spreadsheet, yet impact it?

Customers don’t leave bad companies; they leave companies that miss the mark when it comes to customer engagement. To better serve our customers we need to understand and adapt to the psychology of a new customer … one who has been trained to work as a Digital Native.

What would that look like? Tech people who interact with patience, collaboration, deep knowledge, and an openness to input, adapting to a customer’s needs in real-time. Wouldn’t that create a relationship that is second to none and unbreakable? Wouldn’t that be a leg up on the competition?

By understanding that new business culture has been influenced by the gaming experience, we have a deeper understanding of what is important to our customer base. And like a video game, if you cling to hierarchy, you lose. If you get caught up in linear time management, you lose. If you cling to bottlenecks and tradition you lose.

Three key takeaways: speed, adaptation, and collaboration

Those three words sum up today’s business environment. By now, you should not be surprised that those drivers are skills honed in video games.

We’ve explored the radically different ways that Digital Natives approach business opportunities. As the emerging leaders of the technological world, we must shift our operations to be more open, collaborative, iterative, and experience based.

Rob challenges you to get involved in his and other collaborative open source projects. Brad challenges you to try new leadership styles that engage with the Cloud Generation. Together, we challenge our entire industry to embrace a new paradigm that redefines how we interact and innovate. We may as well embrace it because it is the paradigm that we’ve already trained the rising generation or workers to intuitively understand.

What’s next?

Brad and Rob collaborated on this series with the idea of extending the concepts beyond a discussion of the “digital divide” and really looking at how culture impacts business leadership.  Lately, we’ve witnessed that the digital divide is not about your birthday alone.  We’ve seen that age alone does not drive the all cultural differences we’ve described here.  Our next posts will reflect the foundations for different ways that we’ve seen people respond to each other with a focus on answering “can digital age workers deliver?”

Like the conclusion?  Reading the rest of the series! 1: Intro > 2: ToC > 3: Video Reality > 4: Authority > 5: On The Game Training > 6: Win by Failing > 7: Go Digital Native > 8: Three Takeaways

 

Cloud Culture: Becoming L33T – Five ways to “go digital native” [Collaborative Series 7/8]

Subtitle: Five keys to earn Digital Natives’ trust

This post is #7 in an collaborative eight part series by Brad Szollose and I about how culture shapes technology.

WARNING: These are not universal rules! These are two cultures. What gets high scores for Digital Natives is likely to get you sacked with Digital Immigrants.

How do Digital Natives do business?

You've gotta deal with itYou don’t sell! You collaborate with them to help solve their problems. They’ll discredit everything say if you “go all marketing on them” and try to “sell them.”

Here are five ways that you can build a two-way collaborative relationship instead of one-way selling. These tips aren’t speculation: Brad has proven these ideas work in real-world business situations.

Interested in Digital Native Culture?  We recommend reading (more books):

1) Share, don’t tell.

Remember the cultural response in Rob’s presentation discussed in the introduction to this paper? The shift took place because Rob wanted to share his expertise instead of selling the awesomeness of his employeer. This is what changed the dynamic.

In a selling situation, the sales pitch doesn’t address our client’s needs. It addresses what we want to tell them and what we think they need. It is a one-way conversation. And if someone has a choice between saying “yes” or “no” in a sales meeting, a client can always have the choice to say “no.”

Sharing draws our customers in so we can hear their problems and solve them. We can also get a barometer on what they know versus what they need. When Rob is presenting to a customer, he’s qualifying the customer too. Solutions are not one size fits all and Digital Natives respect you more for admitting this to them.

Digital Native business is about going for a long-term solution-driven approach instead of just positioning a product. If you’ve collaborated with customers and they agree you’ve got a solution for them then it’s much easier to close the sale. And over the long term, it’s a more lucrative way to do business.

2) Eliminate bottlenecks.

Ten years ago, IT departments were the bottleneck to getting products into the market. If customers resisted, it could take years to get them to like something new. Today, Apple introduces new products every six month with a massive adoption rate because Digital Natives don’t wait for permission from an authority.

The IT buyer has made that sales cycle much more dynamic because our new buyers are Digital Natives. Where Digital Immigrants stayed entrenched in a process or technology, Digital Natives are more willing to try something unproven. Amazon’s EC2 public cloud presented a huge challenge to the authority of IT departments because developers were simply bypassing internal controls. Digital Natives have been trained to look for out-of-the-box solutions to problems.

Time-to-market has become the critical measure for success.

We now have IT end-user buyers who adopt and move faster through the decision process than ever before! We interfere with their decision process if we still treating new buyers as if they can’t keep up and we have to educate them.

Today’s Digital Workers are smart, self-starters who more than understand technology; they live it. Their intuitive nature toward technology and the capacity to use it without much effort has become a cultural skill set. Also they can look up, absorb, and comprehend products without much effort. They did their homework before we walked in the door.

Digital Natives are impatient. They want to skip over what they know and get to real purpose and collaboration. You add bottlenecks when you force them back into a traditional decision process that avoids risk; instead, they are looking to business partners to help them iterate and accelerate.

 How did this apply to the Crowbar project?

Crowbar addresses a generation’s impatience to be up and running in record time. But there is more to it than that: we engage with customers differently too. Our open source collaboration and design flexibility mean that we can dialog with customers and partners to figure out the real wants and needs in record time.

3) Let go of linear.

Digital Natives do not want to be walked through detailed linear presentations. They do want the information but leave out the hand holding. The best strategy is to prepare to be a well-trained digital commando—plan a direction, be confident, be ready to respond, and be willing to admit knowledge gaps. It’s a strategy without a strategy.

Ask questions at the beginning of a meeting—this becomes a knowledge base “smell test.” Listening to what our clients know and don’t know gets us to the heart and purpose of why we are there. Take notes. Stay open to curve balls, tough questions, and—dare we say it—the client telling us we are off base. You should not be surprised at how much they know.

For open source projects at Dell (Rob’s Employeer), customers have often downloaded and installed the product before they have talked to the sales team. Rob has had to stop being surprised when they are better informed about our offerings than our well trained internal teams. Digital Natives love collecting information and getting started independently. This completely violates the normal linear sales process; instead, customers enter more engaged and ready if you can be flexible enough to meet them where they already are.

4) Be attentively interactive.

No one likes to sit in one meeting after another. Why are meetings boring? Meetings should be engaging and collaborative; unfortunately, most meetings are simply one-way presentations or status updates. When Digital Natives interrupt a presentation, it may mean they are not getting what they want but it also means they are paying attention.

Aren’t instant messaging, texting, and tweeting attention-stealing distractions?

Don’t confuse IMing, texting, emailing, and tweeting as lack of attention or engagement.

Digital Natives use these “back channels” to speed up knowledge sharing while eliminating the face-to-face meeting inertia of centralized communication.

Of course, sometimes we do check out and stop paying attention.

Time and attention are valuable commodities!

With all the distractions and multi-tasking for speed and connectivity, giving someone undivided attention is about respect, and paying attention is not passive! When we ask questions, it shows that we’re engaged and paying attention. When we compile all the answers from those questions, our intention leads us to solutions. Solving our client’s problems is about getting to the heart of the matter and becomes the driving force behind every action and solution.

Don’t be afraid to stray from the agenda—our attention is the agenda.

5) Stay open to happy accidents.

In Brad’s book, Liquid Leadership, the chapter titled “Have Laptop. Will Travel” points out how Digital Natives have been trained in virtualized work habits because they are more effective.

Our customers are looking for innovative solutions to their problems and may find them in places that we do not expect. It is our job to stay awake and open to solution serendipity. Let’s take this statement out of our vocabulary: “That’s not how we do it.” Let’s try a new approach: “That isn’t traditionally how we would do it, but let us see if it could improve things.”

McDonald’s uses numbers for their combo meals to make sure ordering is predictable and takes no more than 30 seconds. It sounds simple, but changes come from listening to customers’ habits. We need to stop judging and start adapting. Imagine a company that adapts to the needs of its customers?

Sales guru Jeffery Gitomer pays $100 in cash to any one of his employees who makes a mistake. This mistake is analyzed to figure out if it is worthy of application or to be discarded. He doesn’t pay $100 if they make the same mistake twice. Mistakes are where we can discover breakthrough ideas, products, and methods.

Making these kinds of leaps requires that we first let go of rigid rules and opinions and make it OK to make a few mistakes … as long as we look at them through a lens of possibility. Digital Natives have spent 10,000 hours playing learning to make mistakes, take risks, and reach mastery.

Keep Reading! Next post is Three Takeaways (previous Win by Failing)

 

 

Cloud Culture: Level up – You win the game by failing successfully [Collaborative Series 6/8]

Translation: Learn by playing, fail fast, and embrace risk.

This post is #6 in an collaborative eight part series by Brad Szollose and I about how culture shapes technology.

It's good to failDigital Natives have been trained to learn the rules of the game by just leaping in and trying. They seek out mentors, learn the politics at each level, and fail as many times as possible in order to learn how NOT to do something. Think about it this way: You gain more experience when you try and fail quickly then carefully planning every step of your journey. As long as you are willing to make adjustments to your plans, experience always trumps prediction.

Just like in life and business, games no longer come with an instruction manual.

In Wii Sports, users learn the basic in-game and figure out the subtlety of the game as they level up. Tom Bissel, in Extra Lives: Why Video Games Matter, explains that the in-game learning model is core to the evolution of video games. Game design involves interactive learning through the game experience; consequently, we’ve trained Digital Natives that success comes from overcoming failure.

Early failure is the expected process for mastery.

You don’t believe that games lead to better decision making in real life? In a January 2010 article, WIRED magazine reported that observations of the new generation of football players showed they had adapted tactics learned in Madden NFL to the field. It is not just the number of virtual downs played; these players have gained a strategic field-level perspective on the game that was before limited only to coaches. Their experience playing video games has shattered the on-field hierarchy.

For your amusement…Here is a video about L33T versus N00B culture From College Humor “L33Ts don’t date N00Bs.”  Youtu.be/JVfVqfIN8_c

Digital Natives embrace iterations and risk as a normal part of the life.

Risk is also a trait we see in entrepreneurial startups. Changing the way we did things before requires you to push the boundaries, try something new, and consistently discard what doesn’t work. In Lean Startup Lessons Learned, Eric Ries built his entire business model around the try-learn-adjust process. He’s shown that iterations don’t just work, they consistently out innovate the competition.

The entire reason Dell grew from a dorm to a multinational company is due to this type of fast-paced, customer-driven interactive learning. You are either creating something revolutionary or you will be quickly phased out of the Information Age. No one stays at the top just because he or she is cash rich anymore. Today’s Information Age company needs to be willing to reinvent itself consistently … and systematically.

Why do you think larger corporations that embrace entrepreneurship within their walls seem to survive through the worst of times and prosper like crazy during the good times?

Gamer have learned that Risk that has purpose will earn you rewards.

Cloud Culture: Reality has become a video game [Collaborative Series 3/8]

This post is #3 in an collaborative eight part series by Brad Szollose and I about how culture shapes technology.

DO VIDEO GAMES REALLY MATTER THAT MUCH TO DIGITAL NATIVES?

Yes. Video games are the formative computer user experience (a.k.a. UX) for nearly everyone born since 1977. Genealogists call these people Gen X, Gen Y, or Millennials, but we use the more general term “Digital Natives” because they were born into a world surrounded by interactive digital technology starting from their toys and learning devices.

Malcolm Gladwell explains, in his book Outliers, that it takes 10,000 hours of practice to develop a core skill. In this case, video games have trained all generations since 1977 in a whole new way of thinking. It’s not worth debating if this is a common and ubiquitous experience; instead, we’re going to discuss the impact of this cultural tsunami.

Before we dive into impacts, it is critical for you to suspend your attitude about video games as a frivolous diversion. Brad explores this topic in Liquid Leadership, and Jane McGonnagle, in Reality is Broken, spends significant time exploring the incredibly valuable real world skills that Digital Natives hone playing games. When they are “gaming,” they are doing things that adults would classify as serious work:

  • Designing buildings and creating machines that work within their environment
  • Hosting communities and enforcing discipline within the group
  • Recruiting talent to collaborate on shared projects
  • Writing programs that improve their productivity
  • Solving challenging mental and physical problems under demanding time pressures
  • Learning to persevere through multiple trials and iterative learning
  • Memorizing complex sequences, facts, resource constraints, and situational rules.

Why focus on video gamers?

Because this series is about doing business with Digital Natives and video games are a core developmental experience.

The impact of Cloud Culture on technology has profound implications and is fertile ground for future collaboration between Rob and Brad.  However, we both felt that the challenge of selling to gamers crystallized the culture clash in a very practical and financially meaningful sense.  Culture can be a “soft” topic, but we’re putting a hard edge on it by bringing it home to business impacts.

Digital Natives play on a global scale and interact with each other in ways that Digital Immigrants cannot imagine. Brad tells it best with this story about his nephew:

Years ago, in a hurry to leave the house, we called out to our video game playing nephew to join us for dinner.

“Sebastian, we’re ready.” I was trying to be as gentle as possible without sounding Draconian. That was the parenting methods of my father’s generation. Structure. Discipline. Hierarchy. Fear. Instead, I wanted to be the Cool Uncle.

“I can’t,” he exclaimed as wooden drum sticks pounded out their high-pitched rhythm on the all too familiar color-coded plastic sensors of a Rock Band drum kit.

“What do you mean you can’t? Just stop the song, save your data, and let’s go.”

“You don’t understand. I’m in the middle of a song.” Tom Sawyer by RUSH to be exact. He was tackling Neil Peart. Not an easy task. I was impressed.

“What do you mean I don’t understand? Shut it off.” By now my impatience was noticeable. Wow, I lasted 10 seconds longer than my father if he had been in this same scenario. Progress I guess.

And then my 17-year-old nephew hit me with some cold hard facts without even knowing it… “You don’t understand… the guitar player is some guy in France, and the bass player is this girl in Japan.”

In my mind the aneurism that was forming just blew… “What did he just say?”

And there it was, sitting in my living room—a citizen of the digital age. He was connected to the world as if this was normal. Trained in virtualization, connected and involved in a world I was not even aware of!

My wife and I just looked at each other. This was the beginning of the work I do today. To get businesses to realize the world of the Digital Worker is a completely different world. This is a generation prepared to work in The Cloud Culture of the future.

A Quote from Liquid Leadership, Page 94, How Technology Influences Behavior…

In an article in the Atlantic magazine, writer Nicholas Carr (author of The Shallows: What the Internet Is Doing to Our Brains) cites sociologist Daniel Bell as claiming the following: “Whenever we begin to use ‘intellectual technologies’ such as computers (or video games)—tools that extend our mental rather than our physical capacities—we inevitably begin to take on the qualities of those technologies.

In other words, the technology we use changes our behavior!

There’s another important consideration about gamers and Digital Natives. As we stated in post 1, our focus for this series is not the average gamer; we are seeking the next generation of IT decision makers. Those people will be the true digital enthusiasts who have devoted even more energy to mastering the culture of gaming and understand intuitively how to win in the cloud.

“All your base belongs to us.”

Translation: If you’re not a gamer, can you work with Digital Natives?

Our goal for this series is to provide you with actionable insights that do not require rewriting how you work. We do not expect you to get a World of Warcraft subscription and try to catch up. If you already are one then we’ll help you cope with your Digital Immigrant coworkers.

In the next posts, we will explain four key culture differences between Digital Immigrants and Digital Natives. For each, we explore the basis for this belief and discuss how to facilitate Digital Natives decision-making processes.

Keep Reading! Next post is 4: Authority  (previous is ToC)

 

 

Cloud Culture Series TL;DR? Generation Cloud Cheat sheet [Collaborative Series 2/8]

SUBTITLE: Your series is TOO LONG, I DID NOT READ It!

This post is #2 in an collaborative eight part series by Brad Szollose and I about how culture shapes technology.

Your attention is valuable to us! In this section, you will find the contents of this entire blog series distilled down into a flow chart and one-page table.  Our plan is to release one post each Wednesday at 1 pm ET.

Graphical table of contents

flow chartThe following flow chart is provided for readers who are looking to maximize the efficiency of their reading experience.

If you are unfamiliar with flow charts, simply enter at the top left oval. Diamonds are questions for you to choose between answers on the departing arrows. The curved bottom boxes are posts in the series.

Here’s the complete list: 1: Intro > 2: ToC > 3: Video Reality > 4: Authority > 5: On The Game Training > 6: Win by Failing > 7: Go Digital Native > 8: Three Takeaways

Culture conflict table (the Red versus Blue game map)

Our fundamental challenge is that the cultures of Digital Immigrants and Natives are diametrically opposed.  The Culture Conflict Table, below, maps out the key concepts that we explore in depth during this blog series.

Digital Immigrants (N00Bs) Digital Natives (L33Ts)
Foundation: Each culture has different expectations in partners
  Obey RulesThey want us to prove we are worthy to achieve “trusted advisor” status.

They are seeking partners who fit within their existing business practices.

Test BoundariesThey want us to prove that we are innovative and flexible.

They are seeking partners who bring new ideas that improve their business.

  1. Organizational Hierarchy see No Spacesuits (Post 4)
  Permission DrivenOrganizational Hierarchy is efficient

Feel important talking high in the org

Higher ranks can make commitments

Bosses make decisions (slowly)

Peer-to-Peer DrivenOrganizational Hierarchy is limiting

Feel productive talking lower in the org

Lower ranks are more collaborative

Teams make decisions (quickly)

  1. Communication Patterns see MMOG as Job Training (Post 5)
  Formalized & StructuredWaits for Permission

Bounded & Linear

Requirements Focused

Questions are interruptions

Casual & InterruptingDoes NOT KNOW they need permission

Open Ended

Discovered & Listening

Questions show engagement

  1. Risks and Rewards see Level Up (Post 6)
  Obeys RulesAvoid Risk—mistakes get you fired!

Wait and see

Fear of “looking foolish”

Breaks RulesEmbrace Risk—mistakes speed learning

Iterate to succeed

Risks get you “in the game”

  1. Building your Expertise see Becoming L33T (Post 7)
Knowledge is Concentrated Expertise is hard to get (Diploma)

Keeps secrets (keys to success)

Quantitate—you can measure it

Knowledge is Distributed and SharedExpertise is easy to get (Google)

Likes sharing to earn respect

Qualitative—trusts intuition

Hopefully, this condensed version got you thinking.  In the next post, we start to break this information down.

Keep Reading! Next post is Video Reality