Self-Steering Organization: 6 Mistakes We Made
We recently started working with self-governing teams. We call them circles. They operate as entrepreneurial mini-companies within Board of Innovationand take on business responsibilities accordingly.
A year and a half in, we have overachieved our main targets — growing a strong team, creating greater business impact for our clients, and making people around the world innovate.
But we’re going to be honest: there have been quite a few bumps along the road and a few wrong turns when trying to create a workplace culture that reflects who we are and how we like to work, without going under. Since more and more organizations have been transitioning to similar agile and flexible self-steering models, we decided to share our experience to help others who are on the same path.
Learning 1: Give direction and create a shared ambition
Throwback to beginning of 2018: Our self-steering circles had set up their own goals and missions. Powerful example of walking our talk, right? Not entirely. Halfway through the year, we came to the conclusion that it was not very effective. The teams reported that it was tough to decide on priorities and noticed the results were not as good as they had been. As a group, we acknowledged the need for more clarity from on high about overall expectations.
It might seem strange that entrepreneurial, self-steering teams would ask for more “top down” direction after working independently. Looking back, though, it makes a lot of sense. Most of the people at the company were fairly new and still finding their way. As a result, team members often found it very difficult to take decisions without enough context or background. Some circles felt like they were on a rudderless ship in rough seas. Strong leadership was needed to set the direction.
Last summer, we got clearer about our overall ambitions and targets. We have set up several key metrics in a shared dashboard, that provides us with an indication on how we are doing with respect to our 3 big missions (see picture). After doing this, there was a lot more focus within the circles. In the second half of the year, we really started achieving phenomenal results.
Ever since, it’s been much easier to see that the circles are not supposed to be operating as silos. They organize their own business from A-Z, but are guided by a common purpose, an overall strategy framework and Board of Innovation-wide targets. Being transparent about where we want to go as a company is key for the circles to feel committed and empowered to contribute to the general mission. Another awesome side effect: a collective goal reduces competition and reinforces helpfulness, one of our core values. Circle members actually spend about 20% of their time helping other circles on their projects (#proud)!
Learning 2: Be serious about giving trust and autonomy
A culture of trust and autonomy seems a very obvious requirement when building self-steering teams, but it can be a tough one to create. As said, the first few months did not always go as smoothly as we hoped. Another example of this involved following up on finances, a circle responsibility. At first, our financial monitoring seemed to fail badly. Month after month we had concerning differences in our numbers at a rate of up to 50%. Some projects reported as invoiced in a given month were off by 2 months. It did not look good. We expected our founders to step in and take over.
But they didn’t.
They were serious about their faith in self-governing teams and trusted the learning curve. They probably lost some sleep, but they stayed true to their core beliefs of how this organization should be. A lot of effort was put into coaching and supporting the circles in this aspect, and by May all of our numbers added up (and have ever since).
Don’t be mistaken: a self-organizing team still requires mentoring and coaching, but be sure to avoid the reflex to command, control, or centralize when things go wrong. For those of us who can be control freaks (#guilty), the trust and patience given was eye-opening, as was the realization that a successful self-steering organization is not built in a day.
Learning 3: Increase transparency
If you want entrepreneurial teams to successfully run a business, this also implies sharing more sensitive information with them.
We were always very transparent within the company about ongoing strategic and tactical discussions, and feedback from our advisory board. On our messaging channel, Slack, everyone can read what’s going on between different circles, read meeting reports, and reach out when they need help, advice, or feedback. We like working in an open feedback culture. And as soon as we adopted this model, everyone also got access to the finance sheets and sales numbers to keep track. There was one area where we were still lacking transparency, though. Salaries. People felt it was a black box and had no clue whether it was a fair system or not. It created friction and frustrations.
Over the summer of 2018, we decided to turn this around and be drastically more open about the way employees were being rewarded and why, and who was in which salary category. Circle members became much more involved in defining someone’s salary. The new way of working allows peers to give input on whether or not someone can jump up to another salary category, depending on their demonstrated and increased impact on the organization. Everyone appreciated the new openness. We are still experimenting with and improving this new model, but we are impressed by the level of maturity and constructive criticism everyone is bringing to the table. It’s also a solid fundament to build upon. In time, circles could decide on their own salaries.
One of the main drivers for working in a self-steering workplace is to allow for efficient and effective decision making. By this, we mean an end to approval flows and reporting lines, and decisions made by someone who’s too far up in the hierarchy to understand the full scale of the decision. Our decision-making follows an advice model — ask and receive an informed opinion — rather than an authoritative or consensual one. It boils down to this: colleagues are given the right to decide, but the duty to ask for the advice of both experts and people impacted by the decision.
The decision-making model we created sounded really good when we introduced it. We were prepared for some decisions being wrong, but we were confident that after a humbling face palm, we would pick ourselves up, dust ourselves off, and carry on. But what happened was this: instead of fast(er) decision making, we fell into a kind of decision inertia during the first months. The advice model led to a lot of different opinions, and people got stuck in trying to find a compromise or consensus. Sometimes, people still turned to the founders to make the final call, even though the founders were trying to let go of the operational side of the company and pass the decision-making baton to their autonomous employees.
In self-governing organizations, making strong calls is key. So we introduced several rule-of-thumb questions to facilitate decision-making, and steer away from analysis paralysis. Because in an ambiguous environment, it’s rarely black or white.
We suggested that people ask themselves (and their advisors) benchmark questions like: Is it in the best interest of Board of Innovation? Is it safe enough to try? When in doubt about taking on a client project for moral reasons, for example, ask: Would you be proud to take the lead on this project and publish an article about the client and the project outcomes? We even introduced similar rule-of-thumb questions to make a collective decision on hiring or letting someone go. It’s not the easiest way of working, especially when making tough calls, but it does lead to valuable insights and steers discussions in the right direction. In the past months, everyone has relied significantly less on the founders for input, and took more decisions with each other’s help.
Learning 5: Provide space for growth
When it comes to employee promotions in a flat organization, on the surface it can look like there aren’t any real opportunities for career advancement. It’s true that there is no fixed path, as there is in more classical management consultancies (e.g. from junior consultant in the first year, to senior consultant in year three). Some people at Board of Innovation also raised this concern about lack of career growth.
So when we decided to grow ourselves last year, we also tried to highlight opportunities for growth. People get a huge amount of responsibility and direct contact with clients from day one. Because the circles are, in effect, co-leading a small business, people can choose not only to grow as an innovation expert, but also develop skills in recruiting, sales, marketing, finance, or coaching. Apart from that, there is a lot of room for entrepreneurial initiatives and impact on the overall strategy: people can (co-)launch a new venture, kick off a new international office (New York office opening soon), or develop and lead a new business model or service.
We have a culture that emphasizes taking control of your own career. People carve out opportunities for themselves whenever possible. We look for people who are driven by creating impact and leveraging their entrepreneurial skills, rather than being motivated by fancy titles that put them on a higher rung of the corporate ladder.
Learning 6: Get the right people on board
This environment is not necessarily a natural fit for everyone. And it would be painful to try to fit a square peg into a round hole. A mutual fit is critical for success. Along the way, some people have left our organization. The ones who’ve stayed seem to thrive in it.
We’ve learned to put more focus on the cultural aspect during hiring than we did before. Some key traits that are critical to flourish at Board of Innovation are: learning fast, demonstrating strong ownership, bringing a genuine team mind set (no egos, whether big or bruised), being able to deal with ambiguity, having a bias for action, and simply being an entrepreneurial jack of all trades.
Do you think you have what it takes to thrive in a self-steering environment? You’re in luck. We are hiring.
Nele Van Hooste is a true HR rebel at Board of Innovation, a fast-growing global innovation agency, focused on making corporates innovate like startups. Feel free to reach out to her on LinkedIn.
