Agile organizations and their growing pains

The group was silent. They stayed silent, even as the inviting manger tried to send an optimistic and constructive message. Questions were ignored or answered with vague and irrelevant responses. Although the conversation livened up a little in smaller groups, it still lacked clear statements that would have explained this highly unusual behaviour for a group in a work environment. I was faced with the remnants of a group, and an organization, in the aftermath of a failed agile experiment: silence, disappointment, sadness, discord. What had gone wrong?

It was not simply the manager’s doing. He had a very clear understanding of agile methods, agile forms of organizations and he clearly demonstrated that he had reflected on his position and his behaviour and was still doing so. Still, he had underestimated some of the social and psychological dynamics of his experiment.

Later on in the day, we were able to talk about a few of the reasons for the situation this organizational unit found itself in. This did not resolve the deep disappointment and loss of trust in oneself and the company, but it aided a more realistic appraisal. Which circumstances had been obstacles, where was the learning potential?

1. The project employed brilliant people with a good education, high commitment and a passionate pursuit of their ideas. They were to be different from the majority of the employees in this global, very well organized company. They were promised a place where they would be able to pursue their ideas, realize the projects that were closest to their hearts. The beginning was enthusiastic, teams emerged, the work was highly satisfactory. Then, however, the organization interfered with their own strategic notions. These often did not correspond with the dreams and hopes of the employees. Financing was discontinued from some projects – a logical and sensible step from the viewpoint of the company, yet a brutal stop for a new idea with a future which had seen great progress towards realization within a short time. The employees were neither able nor willing to understand the reasoning, and doubted the economic considerations. They were shifted into new projects, new beginnings: the essence of what had filled them with such a deep sense of meaning was gone. Although they were placed into an equally free and self-organized structure, it lacked the content, the emotional attraction. At this point, others left the company already. The mourning of lost projects was tangible during our workshop, it cast a long shadow over everything. However, it was not discussed, like a secret that everyone was aware of. Organizations that are characterized by their participants’ commitment and passion need farewells and rituals of mourning in order to free people up for something new, for a new passion. It is difficult to have a burning passion for a product idea in a context of dependent employment: working with people who want to be committed to facing problems, clients, possibilities seems to have more promise.

2. Following the textbooks, they nominated a Scrum Master, also a brilliant young man, with a lively, fluid intelligence and degrees from several top universities. He was good, but couldn’t put a halt to his own being the best of the best: he was unable to control his urge to be part of the actual work in every field by bringing in his knowledge, his ideas. He tried, quite dogmatically, to communicate the rules and demanded discipline. He lacked social skills, control of his narcissism and an understanding of the task and role of a methodic and social guide. He was the wrong man for this task. Social skills are rarely learnt at top universities.

3. The people were placed in an agile work context without a deeper understanding for the dynamics of an agile, self-organized structure. Their own psychological contract with the company, however, contains many elements that are not agile: these include an understanding of having become part of the system upon entry into the company, a system that takes care to provide a safe place and relieve any concerns about uncertainties of the future. They had entered a safety zone with the promise of a long career. The expected all the freedoms as well as a manager to provide a direction, carry the weight of decision-taking and provide a solution in cases of conflict. What they got was a general strategic direction, a discussion partner and someone who made sure that cooperation with the umbrella organization would work. They did not get any decisions on the content of their topic, their project. That in itself was too much. When it was then decided that the feedback talks would be conducted in the groups themselves, they were completely out of their depths. As no-one had any knowledge or experience of group dynamics, situations escalated and/or the system was paralysed by silence.

4. At first, all doubts, contradictions and uncertainties were compensated by the participants’ own enthusiasm for their own topics. As time went by and projects were lost, it had to be admitted that dreams were just illusions and questions arose: questions about the future, about security, questions that pop up once the buoyancy of enthusiasm is gone. Where careers, securities and rewards had initially been irrelevant, their significance now started to grow. A new importance was given to the future and to career paths. Promotion was the crux, and the notion of lateral careers only caused disappointment. A company that was unable to offer an upwardly mobile career became unattractive.

Following long periods of silence, we were able add up fragments of the pain and disappointments and at least establish a higher degree of truth. Scenarios for a new beginning were sketched out. For some, there emerged another opportunity to re-immerse themselves into an agile world with more understanding. Others gained the clear knowledge that agile self-organization was not the place for them. Some are leaving the organization – the headhunters are lying in wait. The clarity we gained made it possible for individuals to take decisions and forge a path on which to turn the lessons and experiences into a new attempt.

Clarity and the truth about agile organizations need to be told unmistakeably from the start. There has to be an understanding that the participants require a high degree of social competence in order for the journey to succeed. The position of an Agile Culture Coach should be a matter of course. And finally, we need to accept that we still have only few ideas when it comes to showing paths into the future for people in organizational structures of this kind: paths that can be an attractive alternative to the model of vertical careers.

Rüdiger Müngersdorff

Agile Talent Management (II): New Formats and Interventions

I described the fundamental aspects of agile talent management in my last blog post on the topic of talent management: a development-guided notion of talent, talent enabling, self-organization and a supportive talent culture. Building on that, I will now propose further thoughts on actually implementing these in a company.

Talent management with flexible formats

In agile environments, talent management – or rather talent enabling – needs to be dynamic instead of process-driven. We therefore have to question specified annual cycles of talent management. There is little point to conducting employee conversations at pre-set points in time when work structures undergo dynamic change and project cycles take the form of thirty day sprints. The format of the employee conversation is still an important tool in principle. It does not do, however, to use it as a mere step within a process. In other words, feedback is provided, individual development desires and training requirements are talked about and employees are evaluated whenever there is an occasion to do so. The timing is variable, as are the persons who are invited into the setting. Team colleagues may be included, where necessary. Employees and managers have to be enabled to apply these formats for talent flexibly and apply them in their own manner as required.

Talent management software must not be the structural guide for talent development. This is even more true now than it was in traditional forms of organizations. Interaction and learning by experience are pivotal. A a result, talent management and its supporting systems gain a new flexibility. Adaptable and accessible formats for talent are more important than one continuous talent process.

New roles in intrinsic career management

My previous contribution described development-guided behavior and self-organization in talent management; these create a demand for new skills in an organization. Employees now shoulder more responsibility for themselves and their career development. In traditional companies, career planning is often still based on the mechanism of the system: pre-ordained career paths, promotion cycles, appointments as high potential, which will surely deliver the employees – given good work – to the correct (and crucial) position in the organization. Linear formats of this kind no longer work in agile environments. The employees need to establish their own profile of competence by themselves, as well as being able to name their personal motivation and values truthfully and in detail in order to deduce from these their career goals and action plans. It takes a new way of thinking and acting to be able to perform this kind of self-direction. The employees can be supported in their self-organization by way of staff offers with regard to career planning. Such offers include, e.g., position reckoning, peer coaching, job shadowing and mentoring.

Managers will also have to rethink and assume their role as a talent coach. As a professional coach does, they do not decide career questions, but are required to accompany the employee with regular feedback and negotiation that takes into account the available capabilities. They help to identify fields for development and to attain learning goals, they make educational offers, e.g, for new projects. Managers may need support in order to implement this role. This can come in the form of training. However, what is required is not only the attainment of concrete skills but also a new understanding of the management role, as is generally true for agile organizations. As in other fields, the managers will assume a moderating and supporting function in talent management.

Agile talent management requires new formats and interventions. New attitudes and roles need to be assumed and accepted so that flexibility and personal responsibility can be implemented successfully.

Anke Wolf

Agile Talent Management (I): What is talent management in a situation of constant change?

The form of talent management I witness in many organizations is maintained via talent identification and process management. Yet, these inflexible models are rarely able to permit the flexibility that is required in complex, agile environments. If talent management means to tap and foster employee potential in new forms of organization as well, it must leave behind the old, linear ways of thinking and acting and, like the business itself, become non-linear, agile and flexible.

Development-guided notion of talent

A development-guided notion of talent is a helpful addition in this context. In contrast to a static notion of talent, the development-guided understanding does not focus primarily on such categories as talent and high potential. It considers all employees and kinds of talent, essentially the »power of the many« and not the »vital few«. It is a way of maintaining performance and innovation in an uncertain and dynamic situation: by mobilizing the entire staff, distributing the risk and having an experimental attitude.

Differences in performance and potential should not be denied, but considered subject to alteration across time as well as situations. Stanford professor Dr. Carol Dweck demonstrated a startling effect in studies and examples: The mere conviction that abilities can fundamentally always be improved by way of effort and learning by experience has a surprisingly positive influence on individual learning achievements and eventually also the success of a business. Rigid categories of talent and intelligence are more likely to result in status thinking and eventually in standstill (Carol Dweck: Mindset. Changing the way you think to fulfill your potential).

Being guided by development also means that talent management in agile environments is less predictable and more iterative. The aspect of »management«, meaning direction, loses its primacy and can be replaced by »enabling«. Talent enabling is a more appropriate term to describe the way companies enable their employees to free their potential and make this potential available for the company.

Self-organization in talent management

Development-guided talent enabling will profit from concepts such as »learning agility« (a.o. Center for Creative Leadership). The skills entailed in learning agility include the ability to question the status quo, to learn from experience, as well as reflection, feedback and the willingness to take risks. These aspects are surprisingly reminiscent of a SCRUM Sprint. There is little room for rigid formats like career paths. This is so not only because career paths appear to be of little benefit in a fast-changing environment with fluid roles, but even more so because agile organizations live off their employees’ self-guidance and intrinsic motivation. Self-organization means giving the employees responsibility for their development while still remaining at the helm as a company and especially as a manager. Self-organization in the sense of learning agility means that employees identify the need to learn and expand their skill set by learning from experience, reflection and feedback; in that context, it falls to the manager as the person accompanying this process to provide stimuli, give feedback and actively offer learning opportunities. The company as a whole also needs to foster a comprehensive talent culture that goes beyond role descriptions and organization charts to value and sponsor employee learning, trial and error (yes, also the latter), and reflection.

Talent management in agile organizations therefore requires new terminology, new attitudes and a culture that adopts and integrates the company’s own non-linear development.

Anke Wolf

Coinciding with this article we are pleased to introduce one of our associated partners: Anke Wolf from Anke Wolf Coaching & Consulting is a recognized expert in talent management and leadership.

Pirate Leadership: A Dramatic Appeal for Self-Organization in Business

It is the early 1800s. The British warship HMS Surprise is about to engage the enemy. The crew are all preparing below deck. The portholeopens and the captain climbs down in order to commit his men to the sea battle with the French privateer Acheron:

»Right lads (…)! (…) discipline will count just as much as courage. The Acheron is a tough nut to crack: more than twice our guns, more than twice our numbers, and they will sell their lives dearly. Topmen, your handling of the sheets to be lubberly and un-navy like. Until the signal calls, you’re to spill the wind from our sails, this will bring us almost to a complete stop. Gun crews, you must run out and tie down in double quick time. With the rear wheels removed, you’ve gained elevation. And without recoil, there’ll be no chance for re-load, so gun captains, that gives you one shot from the lardboard battery … one shot only. You’ll fire for her mainmast. Much will depend on your accuracy (…). Captain Howard and the marines will sweep their weather deck with swivel gun and musket fire from the tops. They’ll try and even the odds for us before we board. (…) So it’s every hand to his rope or gun, quick’s the word and sharp’s the action.«

Cut to a different scene: Same epoch, same situation, but a few more ships: A collection of vessels from all over the world are facing a united enemy armada. On the Black Pearl, the captain is preparing the crew for sea battle, as above, calling out at them from atop the railing:

»Then what shall we die for? You will listen to me! LISTEN! The other ships will still be looking to us, to the Black Pearl, to lead, and what will they see? Frightened bilgerats aboard a derelict ship? No, no they will see free men and freedom! And what the enemy will see, they will see the flash of our cannons, and they will hear the ringing of our swords, and they will know what we can do! By the sweat of our brow and the strength of our backs and the courage in our hearts! Gentlemen, hoist the colours!«

One of the crew responds with the call »Hoist the colours!«, then two, then all on board. The call spreads to the other ships – Chinese, Indian, French, African – and the colours are hoisted on the masts …

In the first scene, it is the Union Jack flying from the mast. The colours hoisted in the second scene show the Jolly Roger. Both examples are fictional, not historical. They are from blockbuster films: The first captain is Jack Aubrey from the film Master and Commander. The second is Elisabeth, a courageous woman who leads the Pirates of the Caribbean in the film’s showdown. Although these speeches were never actually given in that form in real life, they are paradigmatic for two juxtaposing philosophies of leadership and organisational models: Navy Command vs. Pirate Leadership.

The navy captain has already decided for himself how the battle ahead will be won. He is a brilliant commander and has designed an intelligent plan down to the last detail. His crew is divided into functions and is highly specialised. They are given precise orders, in jargon, telling them who will have to do what and when. The captain can trust that his order will not be questioned by anyone and that everyone will enact his plan to the best of their abilities. He is the boss: the most competent problem solver, the lone decision-maker, the clear giver of orders …

What does Elisabeth do, on the other hand? She merely appeals to her men’s freedom and demands that they all give their full commitment. She leaves the decisions of how the battle will be won to each individual member of the crew. She trusts that each of them will do exactly what they consider the right thing to do in the challenging battle ahead: that collective swarm intelligence will be superior to the enemy’s military command. Elisabeth’s efficacy as a Pirate Leader is not established until the first followers attest their commitment by giving their agreement. Then, their call spreads like wildfire and catches in the other units …

It is easy to draw an accepted parallel between the military and business. Too many words that are used in the economy recall the model function of the military (consider the origins of words like chief officer, strategy, tactic, etc.). It could be more difficult to position the historical pirates as a model for successful leadership. They are usually perceived as an uncontrolled and uncontrollable horde brought together from far and wide by coincidence, who contravene all rules and break the laws to terrorize the seas and caper trade ships with cruelty and no holds barred.

I am not about to legitimize and qualify the illegality of piracy. I do, however, believe that even centuries ago, the pirates created a historical model for successful self-organization with the leadership philosophy outlined above. The economist Peter Leeson has addressed the economic and social organisation among pirates in detail. In the Journal of Political Economy, he concludes that pirates developed »one of the most sophisticated and successful criminal organisations of history«.

Pirates were not at all a chaotic mob, after all. They did have a functioning organization. It rested on a few fundamental rules and a very large degree of self-organization. Thomas Häusler says that the »enemies of humanity«, as they were called by the official authorities, were in fact »true friends of democracy«. That is probably one of the reasons they were pursued without mercy in the absolutist age. The pirate crews elected their captain – for a period of time. It was possible to replace leaders at any time, for example if they proved to be too autocratic or cowardly. The captain only enjoyed absolute authority during attacks. The only other leadership position next to the captain was that of the quartermaster; no other hierarchies were in place.

A few basic prohibitions ensured order: hard punishments were doled out for violence against crew members, theft within the crew, cowardice in battle and gambling for money. The pirates’ codes, which every member had to swear on, often guaranteed that prisoners would be treated well and women respected. They regulated the distribution of the bounty and guaranteed social securities: The pirates had a balanced wage scale, with the captain getting no more than double and the quartermaster no more than one and a half times the share of the bounty as any other member of the crew. Compare that with modern-day CEO wages, which might be as much as 300 times that of the employees! Whoever was injured or even rendered invalid in battle was given a generous compensation and therefore good security. At the same time when the crews on trade ships were given short shrift, subjected to hard drills and maltreatment, the pirates therefore established a »democratic counter-model to the autocratic trade marines« (according to Häusler). It is not for nothing that so many marines defected to the pirates, even at the risk of being pursued by the state as outlaws.

I repeat: I am not calling for lawlessness and breach of compliance in organizations! But I do want to encourage to learn from the historical facts of the pirate era. As I see it – to put it bluntly – too many organizations and departments are nowadays still being managed like marine ships and are casting away a great amount of potential that could by salvaged with Pirate Leadership: especially so in the uncertain navigable waters of the VUCA world.

By now, the first organizations are courageous enough to give Pirate Leadership a try, with democratising structures, consistent self-organization and support for freedom of decision-making on all levels. Brian M. Carney and Isaac Getz published their book Freedom, Inc. in 2009, coining the apt and provocative term of liberated companies. Frederic Laloux offered a very impressive documentation of the potential that can be realized in self-organization in the 360 inspiring pages of his recent, pioneering book Reinventing Organizations (2014). This former McKinsey associate partner provides a detailed analysis of twelve organizations from a range of fields, countries and contexts (with as many as 40.000 employees!) and documents how the abolition of excessive hierarchy and a switch to self-organization can achieve stunning effects.

For example: The Dutch healthcare organization Buurtzorg was able to reduce the care effort per client by 40% (!) by switching to self-organized nursing teams. Ernst & Young estimate a savings potential of approximately two billion Euro if this model was adopted throughout Holland.

It has been argued that this is not possible beyond the NGO sector. The French automotive supplier FAVI has refuted that point: while all of their rivals have by now moved their production to China due to the lower wage costs, FAVI is the only manufacturer of shift forks to remain in Europe, with a market share of 50 percent. The product quality delivered by FAVI is described as »legendary«, their punctuality of delivery is considered »mythical« (not a single order has been delivered late in the last 25 years). FAVI attains high profit margins every year amid aggressive competition from Chinese rival suppliers, pays wages that are clearly above the average and does not suffer employee turnover. Laloux argues that this and other achievements are due to the radical realization of self-management in the organization. Down to the assembly line, the FAVI employees direct, manage and organize themselves in small teams (known as mini-factories), without a declared manager.

A film has recently been doing the rounds on the net: Augenhöhe (a version with English subtitles is available on the site.). It presents more organizations that value self-determination and real participation – successfully so. In February and March, the TV channel arte gave several showings of the wonderful documentation Mein wunderbarer Arbeitsplatz (unfortunately only available in French and German). Like the pirate leader Elisabeth above, the leaders of organisations in this film appeal to the »free men (… and women) and freedom« in the organization.

The organizations in the films and books above that are managed in the spirit of Pirate Leadership show that the focus on self-organization and freedom of decision pay off. Beyond that, most of the people featured in the portraits confirm that they never want to work differently again. This must be another key to the potential that Rüdiger Müngersdorff addressed in his last blog contribution. If, as surveys say, only twenty percent of employees are really motivated, how great is the room for development in an organization in order to win the remaining eighty percent?

With a bit more pathos, we might say that whoever has tasted the freedom of a pirate’s life will not want to return to a marine ship. That notion will strike fear into the bones of many managers. Yet I am convinced that this is in fact the very opportunity for organizations. The quote ascribed to the much-adored and highly successful Steve Jobs is no coincidence: »It’s more fun to be a pirate than to join the navy!«

Johannes Ries