Written By Donna Scarola, Chief People, Purpose & Culture Officer
When people accept a job, they also accept a cost. A job serves a purpose, a place to make income and to drive impact, a place where we use our most precious currency of life, time. With this, there is a compelling question at the center: What purpose is worth the currency of my life? (1)
Most organizations attempt and sometimes successfully answer this question with a clear purpose, mission, or vision. However, as they grow, work and workplaces alike evolve so quickly, it can dilute the thing we feel the most: the culture that surrounds us.
In an ideal world, culture enables purpose. But most often, the purpose feels so distant and idealistic. It can feel as if there is a barrier between you and doing great work. This feeling intensifies as organizations scale. This becomes compounded by policies, roles, and the daily friction of decisions.
When you centralize decisions, you maximize friction. There is a cost to overcomplicating organizations, and it can be measured. One of the most interesting ways to measure this is by Organizational BMI: Bureaucratic Mass Index.
Some examples of a high BMI organization include “bloat: too many managers, administrators, and management layers” or “friction: decision paths are long” or “disempowerment: too many constraints on autonomy.” These things don’t just occur; however, they are designed. And just as the internet is evolving rapidly towards decentralization, creating equity and empowerment — there is a world where organizations can mirror this evolution and phenomenon.
Here are some ways that organizations can design decentralization thoughtfully:
Let teams self-organize around problems, not structure. Allow employees to contract with each other, hold each other accountable and develop their own networks based on skills and interest, not hierarchy or command.
The anatomy of any agile team is the need to form based on a problem, product, or service. Most organizations perpetuate the need to look to the highest ranking person to drive the decisions, but this is antithetical to solving problems.
Most people in “traditional power structures” are furthest from the customer. Some ways to drive this philosophy are by enabling self-formed and led teams using technologies such as Monday.com (we’re fans here at Parcl) and eradicating traditional organizational charts.
Did you know “org charts” originated in the 19th century for the New York & Lake Erie Railroad? Work has drastically changed, being more collaborative and flat by nature; however, the tools we use are lagging. Your organizational chart should resemble the networks within it, not hierarchies of power.
Let ideas, strategy, and problem solving stay crowdsourced — leaders should not drive innovation; they should unleash it by empowering their people. Markets outperform individual entities every time. Take the NYSE; it always outperforms any individual organization in the exchange. While leaders should provide vision, it is imperative that they listen and trust teams.
This can be done by allowing employees to vote on policies and organizational decisions to drive the roadmap forward. By creating transparency and crowdsourcing, you allow people to be brought along, giving everyone the option to co-design the place in which they work. If you want autonomy for your people, give them a voice.
Decentralize budget and pricing decisions entirely. Often budgets are secret in large organizations, inherently leading to more work, more centralized power, and more politics. Let’s take a simple example: people should not waste money that is shared (organizational budget).
Most companies create policies on what you are allowed to spend money for, i.e. food, travel, etc. What if you allowed people to spend money as they see fit and transparently? Every employee’s spending is posted automatically to a public page. “Sara spent $36 a lunch and $592 on her plane ticket”. There is no secrecy; there is no policy. We trust you to spend money as it makes sense for you.
From a behavioral science perspective, rules suffocate people, they entice people to test boundaries, and they waste their energy addressing the real problem at hand. Organizations don’t need you to spend time writing up what you ate for lunch in order to stay within guidelines; they really just want to make sure everyone spends money within reason relative to everyone else to prevent corruption. So instead, let’s use transparency to prevent corruption while also sparing adults an eighteen-page handbook on the glass of Rosé you wanted to order but couldn’t.
When we create complexity in organizations, we create gamifications. When we create transparent and trusting organizations with the support to solve problems, we create high-performing, creative, and agile ecosystems that will win every time. And the thing that unites people at the end of their day, week, or year is hopefully a compelling purpose that is well worth their finest currency, and we hope that what we are building at Parcl is just that.
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Citation
(1) Inspired by the work of Gary Hamel and Mary Parker Follet
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