notes-business-treehouseNoManagerSystem

Intro

Some great articles from a nomanager company:

http://ryancarson.com/post/61562761297/no-managers-why-we-removed-bosses-at-treehouse http://ryancarson.com/post/61606695537/how-to-set-priorities-create-budgets-and-do-project http://ryancarson.com/post/62104586894/how-salaries-career-progression-and-reviews-work-in-a http://ryancarson.com/post/63593803482/how-to-communicate-in-a-nomanager-company http://ryancarson.com/post/73639971628/the-negative-side-of-nomanager-companies

Summary of what they said

" We started the company in 2010 and operated in the normal command-and-control structure. By 2013 we had grown to 60 people with seven managers and four executives. As we added more people to the team, we noticed something disconcerting: rumors, politics and complaints started appearing. "

other no-manager companies include Valve, GitHub?, Gore Associates and Medium.

what managers so:

"

    Communicating messages from top to bottom
    Settling disputes
    Managing careers
    Keeping their teams motivated and happy
    Shielding their teams from things they didn’t think they needed to know"

Treehouse works remotely.

They have a project visibility tool that they call 'Flow' somewhat similar to the one i am thinking of building.

Each day, each person posts a status update for each project, along with an estimated "completeness percentage". These are posted on the tool.

People can work on as many projects as they want/have time for. There is no formal role of project leader/manager, although some projects may decide to have that.

Budgeting is still centralized; budget requests are approved by the co-founders (except that each project gets $500).

There was initially no formal company-wide priorities, although the co-founders still gave narrative 'where are we going' speeches. But it sounds like after a few more months, they are leaning more towards centralized, top-down priorities again.

Performance reviews: every 3 months, each person submits a confidential peer review for each person they worked with on any long-term project during the last 3 months. These are read by a 3-person Review Committee (which consists of 3 execs; a co-founder (the same guy in charge of hiring), the CFO, and someone from 'Accounts'). The review committee then anonymizes the reviews and creates a summary Review Document. They then discuss it with the person being reviewed.

The co-founders (one of whom was on the Review Committee) then look at the review document, 'contextualize each individual performance within the company', consider the company's financial situation, and decide whether to give the person under review a raise (or if they did badly, give them an Official Warning, which means they may get fired if they don't do better soon.

They don't like email. Discussion of projects is done on an internal online forum, so that everyone can see it.

They only have salary, no profit-sharing, no bonuses (except the sales team has a traditional bonus system). New hires get a competitive salary. They have cost-of-living (e.g. inflation) increases to salary but only if the person is doing well.

Downsides to peer reviews that they've noticed are:

General downsides that they've noticed are:

Some of the hiring process is described here: http://wellbredgrapefruit.com/blog/2013/06/01/how-we-hire-developers-at-treehouse/ . It doesn't say how it is decided that someone new should be hired, but i bet that falls under 'budgeting' and so is done by the co-founders. The applications are initially screened by one of the co-founders and then those that remain are forwarded to the entire team (imo this is similar to when an exec has the power to 'nominate' multiple candidates who are then chosen between by a larger body).

My comments

This is not a 100% decentralized, scalable system. (i don't think that's bad, this is not a criticism, i'm just pointing this out for clarity; also, i'm not implying that the author of the blog post was not aware of this, clearly he is). The co-founders are still in charge of company-wide priority setting, budgeting, promotions and firing, deciding when to hire, 'nomination' of new hires, and they have a 'co-founder card' to force people to do things when necessary.

If the company had, say, 80,000 employees (the size of Apple in 2013) instead of 60, surely two people couldn't do all of these functions for all 80,000 people.

So, what this suggests to me is that it is not really a structure that gets rid of managers, but rather it's a 'flatter management structure' that allows ~60 people to have only 2-4 managers (two co-founders, plus the other 2 execs on the Review Committee). The key innovation is to reduce manager responsibility; the managers no longer actually structure and run projects, and they no longer can really get to know each person under them; they don't really 'manage' in the traditional sense. All that the managers do is (a) control money, hiring, strategy; (b) have the authority to order people to do something, but almost as a last resort; (c) partially control of firing and promotion; control is shared with the peer reviews.

In scaling up such a structure, a problem would be: since the managers now have an amorphous portfolio of projects, how would you evaluate them? When the whole company is just one management unit, it's easy (the company's success is the criterion), but if this was a unit within a department within a company it might be harder.

The peer reviews might create discord among employees, but perhaps not, because they don't directly determine anything.

detailed notes/quotes from them

" We started the company in 2010 and operated in the normal command-and-control structure. By 2013 we had grown to 60 people with seven managers and four executives. As we added more people to the team, we noticed something disconcerting: rumors, politics and complaints started appearing. "

"

This is not a new idea. Valve, GitHub?, Gore Associates and Medium (and probably more) are all #NoManager? companies."

"

What do Managers Do?

In my experience, managers’ responsibilities were …

    Communicating messages from top to bottom
    Settling disputes
    Managing careers
    Keeping their teams motivated and happy
    Shielding their teams from things they didn’t think they needed to know"

" Good managers act like servants to their team but far too many like the power and let it go to their heads. "

" The Treehouse Team is spread over the entire United States (with one person in the UK) so we do most of our communication in an internal forum called Convoy '

-- http://ryancarson.com/post/61562761297/no-managers-why-we-removed-bosses-at-treehouse

"

How We Transitioned to No Managers

Once 90% of the company voted to remove management, we started the task of transitioning the company to the new flat structure. The first thing we did was write a huge FAQ for everyone. We did this in Google Docs so people could comment directly in the doc and everyone could see their questions and our following answers. I’ll cover the FAQ content below.

Once the FAQ had been written, Mike Watson created a detailed list of logistical things that needed to happen in order to transition successfully. Example: Who would be doing the backups of our video?

"

" Projects

Projects are the primary unit of work at Treehouse. Anyone can have an idea and propose a Project. Projects do not have to relate to the core expertise you were hired for. Example: A Designer could propose a project to teach a course. How do Projects work?

If you have an idea …

    Open up Flow (our internal tool).
    Click ‘Propose a Project’.
    Explain the Project goals.
    Determine how you will measure success. We encourage you to use measurable statistics and metrics.
    Choose a Focus Area (Education, Marketing, Finance, etc)
    Add the Team roles that are necessary to complete the Project (Developer, Designer, Audio, Video, Data Scientist, etc)
    Spread the word and try to recruit great people to your Project. A good idea is to create a post in Convoy (our internal forum) and ping people on HipChat (our company-wide chat tool).
    People join your Project by going to the Project pitch and clicking ‘Join’.
    Once enough people join, hit ‘Start’. If you don’t need anyone else to help, you can just begin, providing you’ve bounced the idea off people who need to know and starting the new Project will not hamper your ability to execute on existing Project commitments.
    If you don’t gain enough support for your Project you can click ‘Abandon’.

..

Once your Project starts …

    Conduct an initial kickoff meeting with the new Project team
    Once a day, everyone working on the Project needs to post a quick update on where they’re at with the Project and what % complete they are with their tasks. For example, if you’re the Designer, and you feel like you’re 50% done and the Developer feels they’re currently 0% done, assuming it is a two person team the average ‘completeness’ will average out at 25%. The average completeness for each Project will be posted publicly to give the whole company an idea of how complete each Project is.

After your Project completes …

    The team measures how successful the Project was and posts a post-mortem thread on the Project in Convoy (our internal forum).
    The Project team is responsible for providing ongoing support and maintenance of that Project"

" How many Projects can I work on at once?

It’s up to you, just don’t disappoint any of the Teams you’ve joined by getting behind schedule and dragging down the team. The importance of focus in creating quality cannot be understated. "

"

What happens if a team forms, and produces a Project that they all thought was a good idea. But when it’s complete, it turns out to be of poor quality. Who decides if it goes live or not?

We cannot make a rule for this that will always work. There needs to be a robust QA structure in place but beyond that we’re relying on everyone’s good judgement to decide if something is shippable. Once it ships we need the Project Team to be measuring its success and reporting back on whether it succeeded or failed. If I propose a Project, but there’s not enough bandwidth, do I wait on Team Members to finish other Projects or convince others to join mine instead, or do I just have to join another member’s Project in the meantime?

There will be a very small percentage of Project Proposals that actually get started. If yours doesn’t gain traction right away, then just jump into another Project or find something you can do on your own that uses your skills to best serve our Students and advance our Mission. Where do I post my daily Project updates?

For each Project you’re working on, you need to do a daily update in Flow and include your % completeness.

It is vital that everyone posts daily updates on what they’re working on or this whole idea will fall down. "

"

Will people ‘lead’ Projects?

Each Project Team will have it’s own way of working. Sometimes the best thing to do will be to elect a leader who makes sure everything is driving forward and organized, for example coordinating with teams outside of that particular Project or product. Other times, it may make sense to not have a leader and just divide roles and tasks as needed. "

" How does everyone know what’s happening on other Projects?

You go to the Project page in Flow and read the status updates. If you need more info you can jump into HipChat? (company-wide chat room). We discourage email as it creates information silos. What tools do Project Teams use? (Trello, Asana, etc)?

After a Project has been started, it’s up to the Project Team to use whatever tool is best suited for their work. Who prioritizes Projects?

There isn’t any top-down prioritization (unless we are required by law to act on an issue or some “red alert” type work is required, which should be rare). "

"

How do we spend money and are there budgets?

We want to be clear about something, moving to a flat structure does not mean everyone has carte blanche with Treehouse financial resources. There is one exception:

We are going to start off with no set budgets for Projects at Treehouse. If your team needs to spend less than $500, then you can go ahead and do it on the condition that everyone on the Project Team has unanimously approved it. This will probably mean that whenever you spend money, you have to file a claim through Expensify or you can request a cash allowance from the company. Project teams can spend up to $500 if unanimously agreed amongst the team.

If a Project’s spend increases or is expected to increase above $500 in aggregate, you need the approval of the Co-Founders.

Project spending will be listed publicly so we can all see who’s spending what. "

" What’s happening with our current top five priorities?

They have been deprecated. You all will be deciding your day-to-day priorities. The Co-Founders will be communicating their 50,000-foot view of the monthly priorities but they are just guides. How do we make decisions?

We use our company wide goals, Mission Statement, and impact on free cash flow as a guide for decision making. Who decides company-wide priorities? Who sets the general direction for the company?

Alan and Ryan (the Co-Founders) are actively steering the ship and setting company-wide goals, our Mission Statement and areas of focus. What are the Co-Founder’s roles in this new system?

Ryan and Alan are still very much leaders of the company. They will decide on company-wide goals, make sure our Mission remains relevant driving force, and keep our current areas of focus updated. "

-- http://ryancarson.com/post/61606695537/how-to-set-priorities-create-budgets-and-do-project

"

No Ladder to Climb

Now that we’ve removed managers, there isn’t a traditional career ladder to climb. At most companies the way to get more money and influence is by becoming a manager. How does this work in a #NoManagers? company?

Everyone is hired at Treehouse at an industry-standard salary level that matches their job description. Most of our team is distributed and outside of expensive outlier markets (like Silicon Valley or NYC).

The only way to get a salary increase is by performing consistently well in reviews. We don’t have a profit-sharing plan or bonuses (other than the sales team which has a traditional sales team bonus structure).

One of the great advantages of a #NoManager? company is that people aren’t forced to go into management to get more money or increase their power. " -- http://ryancarson.com/post/62104586894/how-salaries-career-progression-and-reviews-work-in-a

"

Peer Reviews

Accountability is vital for #NoManager? companies to succeed. Since no one is telling anyone what to do, slackers could just sit around and do nothing, right? Peer Reviews make sure that bad folks are rooted out and asked to leave the company. We chose to implement a system that’s similar to the 360 Degree Review but with a twist. I’ll explain how it works below.

..

How Reviews Work: The Review Cycle

A Review Cycle will occur every three months. Each person writes anonymous reviews of colleagues that they’ve worked with closely since the last review period*. For example, if you were a Developer and you worked with a Designer and a Customer Support person on a Project, you’d review both of them and they’d both review you.

...

Everyone is expected to write a solid review in ~15-20 mins, per person. It could take much less time if we’re organized about keeping notes between review cycles.

Reviews are submitted to a Review Committee made up of myself, Alan (my Co-Founder), Mike (CFO) and Rich (Accounts). The Review Committee then reviews all submissions and asks for clarification if needed. Afterwards, they anonymize and consolidate all reviews on an individual into one Review Document. That document will be used to guide the review (in-person or Google Hangout between person being reviewed and the review committee). Each person gets a copy of their review documents. "

" We also ask everyone to answer the following questions about themselves:

    How do you think you are doing?
    How do you think Treehouse is doing?
    How do you think your team is doing?
    What’s keeping you from doing the best work of your life?
    Is there anything else you think the Review Committee should be aware of?

"

" Raises

Alan and I are in control of raises. Recommendations from the Review Committee and Treehouse’s financial situation will be the key determining drivers of whether or not a raise will be given. "

" Major Cons

Two large drawbacks to this Peer Review system so far are:

    It is very time consuming. As we grow the company we’ll need to find a way to make this as seamless and easy as possible. Theoretically it should scale as there’s a practical limit to the number of people you can work closely with during a 3-month period - no matter how large the company grows.
    People weren’t as harsh on each other as they should’ve been. Our belief is that because we only finished the first review cycle that people are just getting used the the system. In the future however, feedback will need to be much more constructively critical to be valuable.

"

--- http://ryancarson.com/post/62104586894/how-salaries-career-progression-and-reviews-work-in-a

" Email is email. Blech. Here are the email rules …

    Don’t use it unless it’s your last resort
    Never discuss Projects in email. Use the discussion forum in the Flow Project. All information should be as public as possible.
    Don’t worry about inbox zero. Focus on your Projects in Flow. Ideally check your email only once or twice a day.

" -- http://ryancarson.com/post/63593803482/how-to-communicate-in-a-nomanager-company

" Negative #1: Lots of chaos

...

Being a part of a #NoManager? company feels like being part of an ant colony. Everyone is really busy doing something. It’s not entirely clear what’s happening, but there is a lot of activity and eventually large structures/tunnels get built.

I know for a fact that we have Projects that were started and eventually abandoned because another Project was conflicting or duplicating their work.

..

Negative #2: Coordination is very hard

We don’t have Managers to coordinate across Projects so it’s up to individuals to take time to communicate what’s happening on their Project and how it affects others. Non-Managers aren’t used to the level of communication needed to coordinate with other Teams and Projects so there often is not enough proactive communication and coordination.

What is supposed to happen is that folks can read the status updates from other Projects to get a sense of what is happening and how they should act. People get busy though and this often doesn’t happen.

We’re learning that we need to decide as a company what our quarterly goals are, and then propose Projects accordingly. That high level coordination happens at the beginning of each quarter as we set our goals and priorities.

An example of this is that me and my Co-Founder decided we could probably hit a goal of $X million in revenue in Q1 of 2014. We then asked the Team to set their own priorities for how they can make that happen. It took us about two days to hash this out over Convoy and Google Hangouts. Once that was done, then each Team communicated to the whole company what they were planning on doing in Q1. Negative #3: Starting Projects can be slow

In the past the executives would create a 90-day plan, communicate down to the managers and people would start working. It didn’t matter if the troops thought the priorities were good or bad - they just did what they were told.

Now you have to propose a Project, explain it thoroughly and convince people to join. This process can take weeks or months. Often no one wants to work on your Project and it dies.

Negative #4: I can’t make people do things

...

Occasionally my Co-Founder and I will absolutely need something to happen. If that’s the case, we “pull our Co-Founder card” and politely ask someone to get something done. We try to do this as little as possible but it does happen occasionally.

Negative #5: It takes longer to understand what’s going on

In normal companies all the CEO has to do is have a meeting with his executive team, and he’s up to speed. Not in a #NoManager? company. When I return from holiday and I’m out of the loop, I have to spend about two days reading through status updates and chatting to people.

It’s frustrating. I’m not going to lie. Negative #6: Harder to hire people

Hiring people in a #NoManager? company is a collective decision so it takes longer. Tommy Morgan describes our general process for hiring Developers (which is similar to other roles) in this post. The final step in that process is that the team (for instance the Design Team) has to all agree they should hire this person. If anyone has doubts, then we don’t hire.

A lot of people think they want to work without managers, but actually they like the security of someone telling them what to do every day. This means working at a #NoManager? company isn’t right for everyone, therefore cutting down the potential number of people we can hire.

"

-- http://ryancarson.com/post/73639971628/the-negative-side-of-nomanager-companies

notes from the comments:

" Andy Parkinson • 6 months ago

Hey Ryan, I'm really enjoying the series so far.

My partner and I just spent the last hour chatting about your move to a no manager company and we love what you're up to. My company has been helping organizations design and run their 360/peer review/talent management programs for the last 12 years. (My partner is an organizational psychologist, I'm the tech 1/2).

Here are a couple things that we know about peer / 360 reviews from the research and data that might be of interest:

1) You're probably going to continue to see the results skew towards the positive. Our standard scale has been a 1-7 pt scale for many years. The average response from on tens of thousands of ratings is ~5.4 out of 7. Nobody in our industry wants to publicize this data, as responses skewing so much on positive side is almost embarrassing. Its one of the dirty little secrets that comes with using 360/peer reviews to make compensation decisions.

2) Our research shows that peer reviews naturally reflect the ratee's leadership potential instead of actual performance. Put another way, peers have a natural bias that weights/filters more on the leadership traits and qualities of whom they might want to follow. This has never been researched using #NoManager? companies, but my partner doesn't believe it would be all that different.

There are a few other potential issues with what you are asking people to rate each other on and the rating scale. The good news is that there are things that can be done to mitigate all of the potential issues, even the big ones.

The solutions are beyond the scope of a comment, but if you're interested in chatting more please shoot me an email. My partner has won awards in the academic world for his research on 360 reviews and I know we can help avoid some common pitfalls.

(I'm not trying to sell consulting time or whatever. My partner and I are really fascinated in what you're doing from an academic standpoint and want to help out!)

I'm looking forward to the rest of the series. Thanks for sharing your experiences.

"

"

Avatar Tristan Duncan • 6 months ago

This is so interesting, I really admire both your bravery in trying an entirely new system in a big company, and your transparency in telling us about it.

I'm really interested in the peer reviews. I wonder how much personal bias may affect people's reviews. Do you have any kind of reverse investigation on people who give negative reviews?

For example if an employee gives a bad review about someone who has great reviews from everyone else on the project, perhaps it is actually them that has a performance problem?

Could one employee constantly giving another employee bad reviews be considered a form of bullying?

What about people starting projects and colluding to give each other all great reviews repeatedly in order to get raises?

It sure does sound interesting though, and a peer review from someone who actually worked WITH you is much nicer than an evaluation done by manager.

It is admirable that you are encouraging an open and peer reviewed reward system. I for one would sure love to work in an environment like that, so kudos.

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    Ryan Carson Mod Tristan Duncan • 6 months ago
    " if an employee gives a bad review about someone who has great reviews from everyone else on the project, perhaps it is actually them that has a performance problem?"
    Yes, it's easy for the Review Committee to see if someone gives an outlier review. Those are usually filtered out.
    "What about people starting projects and colluding to give each other all great reviews repeatedly in order to get raises?"
    That's possible but the Review Committee will usually be able to see through this tactic. The interesting thing about a #NoManager company is that the type of people that would scheme like that won't typically survive because on the whole it's obvious they're not offering real value to the company. The flat structure has a way of exposing everyone and how good they actually are at doing.
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" Avatar Rodrigo Pires • 6 months ago

Hello Ryan, thank you for sharing your experiences! Although I'm not sure if seeing companies operating like that are good or bad to our brains :) for some cultures it seems to be only an utopia.

I've some questions, if you can answer:

1) Do you have an H&R department looking over employees professional growth and motivation?

2) How do you intend to make sure employees who are also close friends don't make only good reviews between them?

3) What's your raise frequency policy? Every 3 months?

4) You start saying that there's no ladder to climb, that people don't have to change their job titles to get more money. Then in the end you say they have to (when they hit the ceiling) in order to get more money. I'm confused about it :)

Thank you!

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    Ryan Carson Mod Rodrigo Pires • 6 months ago
    "Do you have an H&R department looking over employees professional growth and motivation?"
    We do have an HR department but they do things like making sure everyone is paid, and we follow employment laws. Professional growth and motivation is taken care of by individuals. If you're not motivated and growing, you won't survive at Treehouse.
    "How do you intend to make sure employees who are also close friends don't make only good reviews between them?"
    The hope is that the reviews average out. Some will be too positive (because they're friends) but hopefully the review committee will see that pattern.
    "What's your raise frequency policy? Every 3 months?"
    We do a peer review every three months. Raises are never guaranteed - only given if they're deserved.
    "You start saying that there's no ladder to climb, that people don't have to change their job titles to get more money. Then in the end you say they have to (when they hit the ceiling) in order to get more money."
    What I meant is that each job role has a specific pay range. Once you hit the maximum, you can't get more money. Some jobs simply pay more than others because of market demand.
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        Rodrigo Pires Ryan Carson • 6 months ago
        Thank you! Looking forward for the next posts ;)
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" if I need everyone to be aware of something, I post it in Convoy and then email everyone the link and ask them to carry on any discussion in Convoy, instead of email. "

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Avatar Petri Heiramo • 6 months ago

Good move, curious to hear how it goes.

There's one thing that strikes me odd - it's the money policy. The owners seem to be fine with people spending time on projects (easily $500 per working day) without prior approval, but don't trust people to use money at their own discretion. This seems to be a typical style in orgs, even "non-manager" ones. As if time and money weren't interchangeable. Ok, so they aren't completely :), but to a meaningful point they are.

At Futurice, everyone a company credit card, but we haven't had any troubles with people not being prudent and responsible with them. And the most important reason isn't the savings made in processing expenses, but in the way people start communicating. As long as there are gates like that, it keeps people in the mode of asking permission, rather than seeking feedback. For more on both points, you might want to check out my post here (http://blog.futurice.com/seeki.... Sorry for the link, but I think it adds to this great conversation.

http://blog.futurice.com/seeking-permission-or-feedback%29

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    Ryan Carson Mod Petri Heiramo • 6 months ago
    The $500 mark is just a first attempt at figuring this out. It's going to be wrong but we just don't know how wrong :)
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        Petri Heiramo Ryan Carson • 6 months ago
        I understand. One possible step forward could be to require two other people outside the team to sign (on a simple form) on purchases above the certain mark. It adds a bit of formality for bigger purchases (in addition to making the transparent, as you already mentioned), without the owners to acting as gatekeepers. Also incite some open discussion about value and ROI as justifiers for investments.
        Of course, a possible danger is that the above is more effort than just asking the owners. Which might be an efficiency challenge related to many initiatives to increase autonomy.
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Avatar Vasco Duarte • 6 months ago

This is a great resource for companies that want to follow the same path. There are a few other companies experimenting with similar approaches.

One that comes to mind immediately is Semco in Brasil (you can read more about it here: http://www.amazon.com/Maverick... -- keep in mind that this is already from the 90's :)

http://www.amazon.com/Maverick-Success-Behind-Unusual-Workplace/dp/0446670553

We recently wrote a piece about an Italian company that is also experimenting working without any managers: http://www.happymelly.com/coco... Worth a read and following them at @cocoonPro

http://www.happymelly.com/cocoon-projects-a-radically-different-organization/

Finally, i'd like to leave a funny t-shirt recommendation. If you happen to live in a company where managers are more like viruses taking over the organzation, then you may want to go to work with this t-shirt ;)

http://randommanager.com/colle...

http://randommanager.com/collections/frontpage/products/planet-of-the-managers

Thanks for sharing and keep more stories like this coming! ;)

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    Ryan Carson Mod Vasco Duarte • 6 months ago
    Maverick has had a huge effect on me. I read it years ago and it's probably the genesis of a lot of our ideas :)
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        Vasco Duarte Ryan Carson • 6 months ago
        Yeah! Makes you think about how important books are for us that have to deal with the so called "real world" ;)
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Vasco Duarte Benoit Doidic • 6 months ago

About hiring: I loved the example that Ricardo Semler from Semco gave in his book (Maverick!): when someone wants to hire a person they open the position and invite colleagues to the interview. If no body shows up to discuss that position or interview the candidates then the position is not needed. Simple and effective.

I think we will see more and more experiments where networks of people will be deciding and leading organizations. It is inevitable in my view, after all this is how the "world" is organized. Hierarchies and power structures are only a recent invention (if you think about human history).

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Avatar gregory • 6 months ago

Ryan, Love this series! I can see how it's working for new projects. How do you deal with ongoing tasks, like making sure customer service emails get replied to?

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    Ryan Carson Mod gregory • 6 months ago
    Some roles (like you mentioned) work on ongoing "always-on" tasks like Support, HR, etc. Those folks don't create projects for these as it's understood they're always working on them and they won't have a finish date."

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Avatar Eric Eskildsen • 6 months ago

I wonder if managers per se weren't the problem. You say that the cofounders are "still very much the leaders of the company," so it sounds like maybe there were just *too many* managers per employee. Two managers for fifty people seems more reasonable. Otherwise management degenerates into an expensive messaging system, as seems to have been the case.

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    Ryan Carson Mod Eric Eskildsen • 6 months ago
    Typical manger-employee ration is 1:10. 1:25 would be too high IMHO.
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    DavidMKelly • 6 months ago
    Great idea and I hope it works out well. I had no idea that any companies worked like this and it certainly is refreshing to see people thinking outside the usual confines.
    I've worked on the "front lines" and also as a manager in my career and quite honestly have been appalled at what I have seen in management circles. Your list of a manager's functions in my experience is an idealized one; that's what a manager is "supposed" to do, but in reality the real list is more like:
    I've seen this pattern in every organization I've been part of. Sure they say all the right words about caring for the team, career development, people are our biggest asset etc. but the reality is that they are simply out for themselves by any means.
    I look forward to following your progress.
    Dave
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        Kahunapig DavidMKelly • 6 months ago
        I've been a financial analyst, CPA, finance manager, programmer, IT manager, and software development manager for 35 years in 7 or 8 (depends on how you count) big and very big ($50+ b) companies. DavidMKelly is spot on. I can only dream that it would work in a giant company as Ryan suggests. They are, after all, made up of a lot of relatively small teams and departments.
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        Ryan Carson Mod DavidMKelly • 6 months ago
        Sadly, you're correct, based on what I've seen in some of the companies I worked for. Sad :(
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Avatar Vishal Gupta • 6 months ago

Very interesting. I being the people manager for last few years very well realize that most of the tasks performed by managers (people, scrum, cross team collaboration/solutioning, delivery, unblocking, appraisals, etc) are well defined tasks and can be very well be replaced by tools & ecosystem. However not sure you can manage strategy, prioritization and product vision without leadership (read business/product managers), yes you can give it a shot by democracy but it will be at the cost of risking wrong directions, chaos and confusion (specially for young people who are yet to mature around business complexities). Many a times there is flux where which direction to go is not crystal clear and someone has to standup and bring in clarity in ambiguity. But nevertheless great radical idea and all the best :). Would love to follow on how this pans out and what changes you bring in as you scale.

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Avatar tmcgill • 6 months ago

This is interesting, but there are some enormous pieces left out of the items you're going to hit on in your posts. The list of what managers do included several cynical things, but didn't include most of the things that people hiring managers are hoping those managers will actually do, which means your list does not match the actual set of functionality you'll need to find a way to replace, such as:

1) Setting and articulating goals. What are we attempting to achieve?

2) Coordinating work among people, providing a point of responsibility for making sure all the work is allocated to someone and all the someones are allocated work, prioritizing things, and keeping track of project timelines.

3) Making actual decisions. Will the product do this, or that? Which of the possible proposed designs will we go with? What avenues will we go down, and which will we as a company not waste our time and money on? What basis of coherence will we try to use to shape to the decisions made? What kind of standards will we use in-house?

All of these are huge needs of any organization. "Everyone" being responsible for something also means nobody being responsible for it, which often results in important things never getting done well, or utter incoherence in how they are done; or it results in people stepping into de facto managerial roles, which can in turn result in resentment or frustration (and all the drama and politics you could ever want) because those people are self-appointed, or in other cases don't want that responsibility at all but are devoted enough to make it happen and can feel others are freeloading.

And making the actual decisions, well, that's a pretty big deal, so I think it would be very helpful if it's explained how that part works.

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    Ryan Carson Mod tmcgill • 6 months ago
    We heard those exact same worries from everyone in the company while we were debating whether to go flat or not. Interestingly enough, all those important decisions are still being made but not by Managers.
    The perception is that Managers somehow protect companies from making bad decisions. In my experience managers make good and bad decisions. What we're seeing in our flat structure is bad and good decisions are still being made but people *own* their decisions because they're not being protected by anyone. There is huge responsibility now because you control what you work on. There's nowhere to hide.
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        tmcgill Ryan Carson • 6 months ago
        Well, my concern isn't exactly about managers protecting against bad decisions. It is about someone making decisions at all, and bringing about coherent action on the part of the group.
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Avatar carlsmith • 6 months ago

Welcome to the party! It's a little unsettling at first but it is so worth it! We've been going for 2 years now and it's given me my life back as a founder.

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    Ryan Carson Mod carlsmith • 6 months ago
    carlsmith Have you guys written about it?
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        carlsmith Ryan Carson • 6 months ago
        Yes sir:
        http://www.ngenworks.com/blog/...
        http://www.ngenworks.com/blog/...
        http://www.ngenworks.com/blog/...
        We've also created a Process Wiki to help others see how we do it and how we're evolving. http://process.ngenworks.com
        Would love to chat sometime about your plans and happy to share all the things we did right and the things we did horribly wrong.
        Should get you on our podcast to talk about the catalyst for you making this move. Our audience (roughly 4,000) love hearing about innovative business models. - http://unmatchedstyle.com/bizc...
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http://www.ngenworks.com/blog/the-jellyfish-model/ http://www.ngenworks.com/blog/jellyfish-blowing-up-the-org-chart/ http://www.ngenworks.com/blog/the-jellyfish-model-lessons-learned-from-the-first-six-months/ http://process.ngenworks.com/index.php/Main_Page http://unmatchedstyle.com/bizcraft

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Collin Vine • 6 months ago

This is very exciting to see and I'm happy to hear you've taken the plunge. At Zirtual, we're getting ready to make the exact same switch, transitioning from a heavy management layer to an empowered frontline, supported by departments and a centralized vision.

It took us a while to fully buy in to the idea, but after you fully question the management structure enough, you realize that there is a better way.

Thanks for sharing!

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Avatar Stelio Verzera • 6 months ago

Hi Ryan, going radical here in Europe too.

We've been iteratively developing our "liquid organization" model for 2 years now. It is working very well, and it is on continuous kaizen.

We have removed a wide range of wastes and bottlenecks, leading us to a flat model based on Lean Thinking and Open Collaboration principles, with no silos, functions or even titles, pure meritocracy in decisions power assignment, strategy co-creation techniques, no more hiring and work interviews, and counting :)

This is about us:

http://www.happymelly.com/coco...

And I've just sent you a tweet with a hangout idea. :)

All the best, S.

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http://www.happymelly.com/cocoon-projects-a-radically-different-organization/

" Falkvinge • 6 months ago

Hi Ryan,

In the Swedish Pirate Party (a political party which has elected representatives in the European Parliament), we also went without bosses - or using swarm methodology, as we call it: leadership is obtained through taking initiatives, and nobody gets to limit anybody else.

This made it possible for us to beat the competition on less than 1% of their budget. I wrote a book about my experiences with that kind of organization, its pros and cons; you (and everybody) can download the book SWARMWISE for free at http://falkvinge.net/books/.

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Avatar Justin Abrahms • 6 months ago

Your link to the Gore-Text article links to the valve book. We're considering a similar move as we grow at sprint.ly. I'm excited to hear about your journey and how it may apply to ours. :)

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    Ryan Carson Mod Justin Abrahms • 6 months ago
    Fixed! Thanks.
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