Depending on your role in an organization, the concept of self-managed teams may seem either delightfully liberating or like a path to a huge dumpster fire. But when executed and communicated properly, many companies have found success with this structure from both cultural and strategic standpoints.
Although a seemingly new concept, self-managed teams have been utilized in companies since the 1960s, and the concept appears even earlier in academic research. With its focus on responsibility rather than hierarchy, it is an appealing solution for companies looking to reinvigorate company culture - data shows that almost 80 percent of Fortune 1000 companies use some sort of self-managed team structure.
Although the concept of self-managed teams seems easy to understand on the surface, how it works day-to-day can be difficult to grasp. Who makes decisions? How will we complete our projects? Basically: WHO IS IN CHARGE?!?
As Nanci Meadows, People Champion at Dynamic Events and Hubb, told us at TINYcon 2018, it’s important to clearly define what self-managed teams are before implementation. So let’s start there.
What are self-managed teams?
In self-managed teams, a given group of employees are collectively responsible for the projects they work on, and specific employees - who are not necessarily managers - take leadership over tasks and initiatives based on their expertise, rather than hierarchy or title.
Self-managed teams are utilized by many large companies, such as Zappos, who incorporated a version of this idea - a holacracy - in 2012. The company has credited the increased creative freedom of this structure with the rise of innovative product ideas among staff.
Myths about self-managed teams
When Meadows joined her team four years ago, the company was struggling with a toxic culture. After extensive research, her leadership team found that it was frequently bringing in “rock star” candidates to fill roles, expecting large responsibility and accountability from them without much support.
“That rock star that you brought in is completely frustrated. And so are you,” she said.
So, leadership turned to self-managed teams as a way to promote autonomy, distribute responsibility, and further innovation at every level of the company. But it didn’t come without hurdles, as well as preliminary misconceptions about what this structure actually entailed.
MYTH 1: No Structure or Direction
Meadows said that one popular myth in their staff’s understanding of self-managed teams was that they would have no structure or direction. But this is not the case. Meadows said this team structure allows leadership to occur where it needs to organically.
“In self managed teams, leadership occurs naturally and according to expertise and responsibility,” Meadows said.
Meadows said that when problems arise in a project, different team members step to the forefront to lead solutions to these issues based on their expertise.
“However you manage outside of work is the same as inside work. Leadership is no different. We have leadership roles - people who, based on their experience and expertise and knowledge, will do something different than another,” Meadows said.
MYTH 2: Everyone is Equal
Although responsibility is spread over the entire team in this structure, Meadows said it doesn’t necessarily mean that everyone is “equal.”
She said that everyone on the team gives and takes as is appropriate to their role and responsibilities. Using an example of a street light versus a desk lamp, she explained that both fulfill the same purpose, but at different scales - similar to comparing the role of a junior-level employee versus a member of executive leadership.
MYTH 3: It’s About Empowerment
A popular buzzword that many organizations use to define how authority is spread is “empowerment.” However, Meadows says this infers power ownership that doesn’t apply to how her organization approaches self-managed teams.
“Empowerment is positive in many ways, but also implies that one person holds all the power and doles a measure of power to someone else. We know that in the real world what is given can be taken back away. That’s not very powerful, is it?” she said.
“In self managed teams, everyone already has the power that they need - it is not doled out to them,” she said. “Self management is power.”
MYTH 4: Decisions are Consensus-Based
You might be thinking, okay, this is great, but how are decisions made? Does everyone have to be in agreement in order to move forward? Contrary to that perception, Meadows says this isn’t the case.
Instead, the company has a process for decision making that teams walk through in order to determine who owns the decision. Although that person is responsible for checking with all involved stakeholders, they are ultimately the one who must make a decision in order to proceed.
What Self-Management Looks Like in Practice
In traditional hierarchical organizations, titles indicate position and authority. But at Dynamic Events and Hubb, Meadows said that employees get to choose their own titles upon hiring.
“We still have titles in our organization, but this is not their purpose,” Meadows said. “We recognize that titles serve a purpose, but it’s an external purpose, not an internal purpose.”
Rather than roles being dependent on power, the self-management team structure focuses on what a role has decision-making rights over. This not only helps create a feeling of ownership over the role, but also makes the employee feel valued from day one - something that many companies could use, as our “The Surprising Effects of Employee Recognition and Appreciation” report found that 77 percent of employees don’t feel strongly valued for they work they put in.
Similarly, managers are tasked with managing commitments, not other people, Meadow said.
“You make a commitment to work with someone, and if that commitment is missed, that’s what you’re managing,” she said.
As a result, the teams, and the individuals who make up these teams, are responsible for upholding the commitments. Meadows said at many companies, management dictates how an objective is achieved - at her company, teams determine this.
“We feel like this is the option of innovation,” she said. Although executives set the what of a commitment, everything else is free game.
How to Create Self-Managed Teams
Meadows remembered that when her company announced the move to self-managed teams, employees initially didn’t have a lot of information to know how the shift would affect them.
“Our people were freaked out!” she said.
It is crucial that leadership and employees both have an understanding of how their role will be impacted, otherwise there is a high risk that staff will lose confidence in the company’s future - and their part in it.
“It does feel like a threat if you do not understand it well enough,” she said, adding that leadership themselves are a crucial part of the success or failure of self-managed teams.
“If you are in C-suite leadership at your organization, you are the most likely point of failure,” she said.
Meadows said this is because leaders in these roles often jump in to micromanage problems, fearing failure, therefore reversing progress being made to allocate decision-making and responsibility to the teams.
“When we finally handed things over to (the teams) and let them put their powerful hands on the same side of the rope with us and pull, that heavy weight moved along with relative ease,” she said.
“A person’s time speaks most to their feeling of autonomy,” Meadows said.
Although facing some implementation hurdles in the beginning, the company moved to unlimited PTO and a work from home policy.
The company’s teams also moved to a data-driven method for reporting and tracking time off. Every employee submits a report weekly about how many hours they worked versus how many they were expecting to work, as well as how much PTO they’ve already taken versus how much they plan to take. These reports, which include names, are delivered to everyone.
“By encouraging transparency, we were able to see from this who was overburdened, who had time - it allowed teams to balance the load,” Meadows said, and also helped inform long-term decisions about hiring.
Along with increased responsibility and decision-making in teams, the company also has teams lead hiring for new positions. All team members are invited to the interview process and make decisions.
This, again, makes the responsibility to hire for a role not solely owned by a manager, but rather a decision that is made based on feedback from the entire team.
“We spend a lot of money on morale and fun - who better to decide how that money gets spent than our teams?” Meadows said.
Rather than leadership deciding how office culture events, such as quarterly celebrations, were planned, they turned ownership of this planning over to teams.
As we’ve written about previously here at TINYpulse, engaging employees in planning and decision-making around culture is crucial to having a workplace that truly reflects its employees.
“There is such freedom in power, in autonomy. At Dynamic Events and Hubb both, we have discovered this amazing synchronicity between autonomy and responsibility and the balance between the two when everyone is free to enjoy it,” Meadows said.
Nanci Meadows spoke at TINYcon 2018. To reserve your tickets to next year's TINYcon, and make sure that you're keeping up to date with the latest in employee engagement and company culture, get your early bird tickets now!
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