The ROI of Democracy at Work

by Jul 22, 2019

Business Innovation Brief Best Article

I asked people at my company Nearsoft, what kind of topics might be of interest for me to write about. One of the comments came in the form of a question: “In a traditional hierarchical organization (i.e. not Nearsoft) as an individual contributor, what’s the best way to make a meaningful change to the culture? In a big organization, is it even worth it or is it just simpler to change jobs?”

Here is a quote I came across that really makes the point as to why companies need to break away from command and control operating systems, and adopt cultures that are co-managed, and co-owned.

“The greatest sign of success for a teacher … is to be able to say: The children are now working as if I did not exist.” ~ Maria Montessori

The same can be said about leadership. You know your organization is humming along just fine when leaders are no longer needed to lead. That’s when people are co-owning the vision, the goals, and the execution.

You don’t have to wait for a company to adopt freedom-based leadership principles in order to make your mark. As an individual you can begin to act as if you are the CEO, as if you are accountable to everyone. You can proactively do what needs to be done, instead of waiting for someone to come ask you.

For example, if you are in sales, proactively make your activity visible. Share you progress, update the CRM system without having to be asked to do it. Create success and progress metrics, measure them, and report them. Run yourself as if you are running the entire sales organization. Be proactive.

Evolving Towards Co-Ownership

I want to acknowledge that as an individual contributor in an environment that isn’t set up to run democratically, you’ll only get so far. I am not talking about political views here, but the real meaning of the word democracy.

de·moc·ra·cy /dəˈmäkrəsē/ a system of government by the whole population. Control of an organization or group by the majority of its members.

In order for an organization to evolve from a command and control structure to a co-managed, co-owned environment, you have to do away with the need for bosses. If you are a boss today, you’ll need to embrace being a servant to the organization, accountable to the organization, not the other way around.

Most importantly you’ll need to be ok with no longer being the boss. This isn’t an easy transition. There are egos involved, not just rationally good common-sense business reasons.

I can best equate this type of change to what happened in the late 90s when the vast majority of outsourcing initiatives failed. Companies were not ready to go from departments having their own teams, to suddenly working with some external third party to get things done.

I remember spending a considerable amount of time educating Fortune 200 companies on how to shift into decentralized models, like shared services.

By creating internal organizations that provided services to the various departments, companies began to get used to the idea of having to scope out work, do better planning, and having a third party deliver services. Albeit the third party was an internal services team. As soon as that became a natural way of doing things, it could just as well be an external team. That’s when outsourcing became more feasible and accessible.

That transition for most companies took time, in some cases it was a 2-year long process. It was a change in the operating system of a company. A significant change from kingdom owner mindsets to developing strategic alliances. Alliances work via enrollment, not commands.

It’s clear that for organizations to move to a more democratic work environment, there needs to be a bridge. More importantly there needs to be a mindset shift from training people to develop skills, to developing people’s emotional intelligence, with a major focus on self-awareness and leadership skills.

Self-Awareness Unlocks Greater Potential

Where there is great leadership, it feels more like a family who support each other through life. In an organization with not so great leadership the people talk about each other with a sense of judgment. It feels more like the current political landscape in America.

“Where there is great leadership, the people talk about the organization and about each other with a sense of pride.”

When employees (or citizen for that matter) are not positively engaged, the problem is with the leadership. The issue however doesn’t get solved by simply replacing the leadership. The issue is bigger, it’s systemic. It’s wide scope.

Rather than putting forward programs to increase employee engagement or trying to buy the employees affection with perks and toys, organizations would be best served to work on developing better leadership, and self-awareness skills with “everyone” in the organization.

With more self-awareness, comes more self-accountability, but more importantly comes more self-esteem and belief in one’s ability to affect change. In other words, the finger pointing stops, and the desire for resolution and mutual understanding begins.

People are Not Resources

Most organizations don’t invest enough on the health of people’s mindset. Mostly because people are treated like property. People are called human resources, human capital, and assets.

When shopping for a vehicle, we test it. When shopping for a home we test the appliances, and we have the home inspected. When we buy clothing, we try them on to test how they fit. We test potential “property” and we ask for warranties.

Sadly, without being consciously aware of it, we test employees and potential employees the same way … as if they are property. We give them literal tests to check competence, and cultural fit, and after we hire them, we test them some more during a probation period.

How do you feel about being property? Does that feeling encourage more engagement and loyalty?

“People are not resources. People are not property. People need to be treated with respect, with dignity. People are the highest expression of the generosity of the Universe.”

If things aren’t running so smoothly where you work, more than likely it’s a serious disconnect with how people are treated, vs. how they should be treated.

For decades this has been ok. Let me rephrase that, it’s never been ok to treat people like property, but companies have gotten away with it because we have family obligations, and “compliance” has been the mode of operations, instead of “reliance”.

Reliance means that you don’t need me, and I don’t need you, but we choose to rely on each other out of our mutual desire to achieve a goal, a purpose. Reliance is based on mutual respect. It’s based on inter-dependence, not co-dependency. Reliance is founded in human dignity.

“Companies need to move towards being more purpose driven tied to human values, and then set up operating environments that enable people to bring their very best and brightest selves freely into the success equation.”

The accountability needs to be moved from employee-to-boss, to co-owner-to-co-owner. This future of work operating model will ensure that anyone and everyone is free to make a difference, encouraged to do so, and develops a sense of responsibility that everyone is relying on each other to proactively be engaged towards everyone’s success.

“You simply can’t compete with a company where the people are united and committed to each other, founded on mutual respect.”

We are talking about conscious capitalism, where people come first, and genius comes out of a collective free people who are valued as co-owners, co-contributors, and co-leaders.

Worried this kind of people centered operating model will hurt your bottom-line? The facts show that companies operating this way have been outcompeting the growth of S&P 500 companies by a factor of 7X for the past 3 years.

This isn’t just a model good for people, it’s the most successful, profitable, competitive, and growth-oriented business operating model in production today. Period!

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