Business Ownership Is Normal, Being An Employee Is Historically the Exception

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Here’s the historical perspective on why no one wants to be an executive and why 65% want to own their own business. We are going back where we came from – business ownership.

For Thousands of Years We Did It Differently

Before 1850 when the Factory System of the Industrial Age took over production, on the low side 80% of adults owned their own business. Almost no one worked for someone else. Owning your own business has always been the norm, and I believe we’ll return to it.

Employment is For Children Only—Adults Need Not Apply

Adults were repulsed by the Factory System concept. The prevailing mindset for thousands of years was pride in ownership, the ability to control your own destiny, freedom to call your own shots, and the desire to master something difficult. People focused on Making Meaning, not just money.

The result? In 1820, 50% of factory workers were under the age of 9, and 86% were under the age of 14, all of them orphans and poor children. Only children would put up with the dehumanizing and controlling work world we have since resigned ourselves to in cartoons like Dilbert, movies like Office Space, and TV sitcoms like The Office.

People Still Don’t Want to Be Employed

An Intelligent Office Work IQ Survey gives us a window into the past before “employment”, and also into our future. Zero percent of respondents to the survey aspired to be corporate executives, while nearly 65 percent said they aspired to be an independent business person. They cited a desire for freedom, reflecting their ancestor’s repulsion to employment.

Employees Take More Risks

Perspective is everything. Before the Factory System, working for someone else was seen as a very risky proposition where you lost control of both your present and your future. It was clear to the 80% that employees could only hope the company would follow through on their promise to help them make it to old age. Their fears were well-founded. A lot of modern employees have lost a lifetime of retirement benefits as companies like United Airlines and others make the retirement promise, then regularly reorganize and leave employees out in the cold.

Owning Your Own Business Only Seems More Risky
So why have the numbers flip-flopped from 80% working for themselves, to 85% working for others? Very simply—corporate America sells short-term security. If you go to work for a corporation, a check starts arriving two weeks later—guaranteed income, of sorts. But to gain that quick fix, the employee gives up all other control over their work, and jeopardizes being fired two weeks later or losing their retirement to bankruptcy.

In contrast, when someone starts his or her own business, all the risk is on the front end. It could be months or much longer before they start taking home money. To secure control over their future, they take the shorter-term risk to strike out on their own, knowing that 90% of life is what you make happen, and 10% is what happens to you.

Own a Business, or Work For Someone Who Will Encourage You to Own

The Participation Age is making it easier to start your own business. It is also creating a hybrid where people may not own the actual company, but who get to bring the whole, messy, creative person to work, make decisions, and be treated like equal adults at work. In a Participation Age company, people can have ideas and actually start new product lines as if they owned the business. At DEG Corporation an employee had an idea and created a $9mlllion division she now runs.

Back To The Future

We’ve got a few thousand years of seeing business ownership as the norm, and only 170 years of being told by corporations that owning your own business is too risky. But younger generations aren’t growing up in the shadow of the Industrial Age and are showing a healthy disdain for employment. I have high hopes they will reignite business ownership as the norm.

article as seen on Inc.com

81% of Adults Would Work Better Without a Manager: Are You One of Them?

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More and more companies are eliminating managers altogether. Would you be one of the four out of five that would thrive there?

The Gallup Employee Engagement Index shows that 29% of people could be self-managed without being encouraged to do so. Another 52% will take charge and be contributors if they were in the right environment that encourages participation. And 19% are incorrigible – they won’t step up no matter how hard you encourage it. The good news is that if a company creates the right culture and a managerless structure, 81% of people will get on board.

Why is this important?

I hear it every week – “We can’t find good people.” – Good – meaning someone who will take the bull by the horns, get things done well and on time, and not require babysitting to do it. But the fact is I only hear that from companies with managers. I’m aware of 100-ish companies that don’t have managers (and there are easily a few thousand that I’m not aware of), and I’ve never heard them say they can’t find good people.

Just a Few Companies Without Managers
These businesses and many more like them, have been able to staff their entire companies with people who don’t need to be managed. Here are just a few:

Whole Foods – 60,000 Stakeholders
W. L. Gore – 10,500 Stakeholders
Barry-Wehmiller – 7,500 Stakeholders
Menlo Innovations – 300 Stakeholders
Valve Corporation – 100 Stakeholders
Crankset Group (our company) – 21 Stakeholders (6 full-time)

Let’s be clear. These are companies where no one works for anyone else – there are no bosses or managers. Leaders become leaders because people are following them, and they stop being leaders when people stop following. A healthy Participation Age company needs the management function, but never needs managers. Teams manage themselves by dividing up the management functions between team members. In doing so, they find that the overwhelming majority of what managers do just isn’t necessary, and that the position of manager is irrelevant.

These companies, and many more like them, have been able to do this when others “can’t find good people”, for one simple reason; they’ve created organizations that don’t have managers. This attracts the 81% who don’t want to live in an Office Day Care Center, but want to function as decision-making adults both at home and at work.

Conversely, when you build a company around managers, you actively attract the 19% who don’t want to grow up at work and love being told what to do. And you make it clear to the 52% in the middle that if they want to keep their job, they’ll stop asking why, do what they are told, and focus solely on production. In these companies, the 29% who are natural Stakeholders will be considered annoying because they keep asking questions like, “Why?”, and suggesting better ways to do things. Managers are threatened by these people and expend a lot of energy putting them in their “place”.

This is why great people leave companies. When people are managed, you destroy their desire or even ability to bring the whole, messy, creative person to work. And that is the part of the person that will be the most valuable to any company in the long run, not the part that is simply “productive”.

Could you make it in one of these managerless companies? Are you one of the 29% who are joyfully annoying, or maybe part of the 52% who would love to have a brain at work if they were only allowed? If so, welcome to the Participation Age. Now go find one of those companies that will welcome you with open arms. They’re all around us, and becoming more common all the time.

article as seen on Inc.com

Richard Branson Is Right: Time Is the New Money

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In the Participation Age, A New Form Of Payment Is Emerging: Time.

Richard Branson just announced he would be giving Virgin employees unlimited vacation. He’s either nuts or knows something others have yet to discover: You’ll make more money if you give people their time back.

 

Why We Trade Time for Money
The Industrial Age taught us the only way to make money was to trade time for it. The deal was clear, and always the same: You give me eight to 10 hours of your day, and I’ll give you some money. But in the Participation Age, something new is emerging. Companies are realizing that when you give people back their time, they will make you more money. It seems counter-logical, but it’s really quite intuitive. As usual, Branson is moving on an idea that traditionalists will only discover by watching him and the other early adapters in action.

Why Would Unlimited Vacation Work?
Why give up on a vacation system that’s been in place for 170-plus years? Because it was a bad idea then, and with a work force that did not grow up in the shadow of the Industrial Age, it’s an even worse idea today. Almost no one under 40 can relate to a time-based system that makes no sense in a results-based work world.

Branson didn’t figure this out; he’s actually a late adapter, which makes a lot of the work world archaic and completely out of touch with how to make money today. Fewer than 1% of U.S. companies give unlimited vacation. In fact, America gives the second-lowest amount in the world, behind only South Korea.

The data is in: When you give people control of their time, they make you more money. W. L. Gore Inc., the pioneer in rejecting the Industrial Age, is a $3 billion company with 10,000 stakeholders. They’ve had unlimited vacation since the 1960s and continue to grow exponentially.

Semco, another great example of a Participation Age company, started making pumps in 1951. It was taken over by Ricardo Semler in 1981 and transformed into a great workplace, including unlimited vacation as just one of many principles that brought humanity back to the workplace. In 1981, it was a $4 million company. Today it’s a $1 billion company and growing, and is in a myriad of industries that Semler could have never imagined. Stakeholder turnover is less than 1% per year.

Some technology companies have been operating this way for years as well, and a growing number of traditional as well as new industries are adopting unlimited vacation. Evernote and NetFlix are just two examples. They are all learning that anything that gives people back control of their lives is proving to be better for the company. Just the opposite of what our Industrial Age forefathers believed.

Pay Raises That Encourage More Vacation
Stakeholders become deeply invested in your company as you bring humanity back to the workplace. The downside? They can start acting like old-style business owners and have to be heavily encouraged to take time off. To combat this and put teeth into our unlimited vacation position, our company, Crankset Group, gives all of our stakeholders $1,500 a year in vacation money (Evernote gives $1,000 in vacation money and FullContact gives $7,500). But you only get it when you turn in receipts that prove you’re using it for vacation.

There are Industrial Age detractors. Articles likes those recently in Time magazine view this cynically. But they are like listening to someone who drew the short straw in a high school debate and had to argue the positive effects of indentured servitude. The arguments against unlimited vacation are tortured at best.

The reality is simple. Give people control over their time, and they will build a great company, not for you, but with you.

In the Participation Age, time is the new money.

Article as seen on Inc.com

Traditional Education: The Sacred Cow Is Slain

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The last great monopoly of the Industrial Age is dying. None too soon.

Our traditional education system is the last great monopoly of the Industrial Age and is awkwardly out of synch with the Participation Age in which we live.

 

Education Won’t Make You Successful
The present system was designed in the mid 1800s specifically to feed the Factory System, for the benefit of a few Industrialists, and to the detriment of the rest of us. It’s still stuck there, focused on churning out employees who are taught two things: a specific skill, and that they should never challenge the teacher’s brilliant and finished view of the world. This sets them up very well to be cogs in a corporate machine, but not to be learners, owners, Stakeholders, or self-managed adults in the Participation Age.

Education Is Not Correlated to Success
There are many reasons why we should not rely on a formal education system that, a century and a half later, is still deeply committed to closed markets and the status quo:

1. Top CEOs—People who never attended or never graduated from college are the number one source of CEOs for S&P 500 companies. (Harvard was number three.)

2. Wealth—One out of five of America’s millionaires never attended or finished college. Many of the rest would say college didn’t help. Almost none could show a clear correlation between school and wealth.

3. Personal well-being or happiness—A college degree leads to lower levels of happiness for twenty-three to twenty-five-year-olds, compared to those twenty-three to twenty-five-year-olds who got an apprenticeship or vocational training.

4. Learning—A full third of college graduates gain no measurable skills during their four years in college.

5. Productivity—High school graduates waste the least amount of time, followed by those with a bachelor’s and MBAs, with PhDs being the least productive.

6. Annual income—Millions of nonattendees and nongraduates make significantly more money than college graduates.

7. Lifetime income—The idea that college graduates make an extra million dollars in their lifetime is an urban myth perpetuated by a system that needs your money to keep it afloat. It has been debunked many times. High school grads can regularly make as much or even more, and with much less debt.

If Not Traditional Education, Then What?
For most of us there are other, better ways: become an apprentice, be a doer, not a thinker, or chase your dream and start a business. Before the education system was formalized in the 1850s, 80% of adults owned their own business. Today it’s reversed. This should not be surprising, since the education system was designed specifically to churn out highly skilled employees taught not strike out on their own. It worked.

But the giant is dead on it’s feet. It just hasn’t fallen yet. Here are just a few of the myriad of better education options emerging in the Participation Age.

The Sudbury Valley School is a K-12 model, with students coming from the full economic strata. There are no classrooms and no syllabus. The adults function as facilitators, not teachers, and learning happens in the context of doing, which research regularly shows is one of the best ways to learn. A staggering 42 percent of Sudbury graduates are involved in entrepreneurial pursuits.

Sudbury is only one example of Participation Age primary learning that ranges from charter schools, to homeschooling, to a myriad of cocreation initiatives.

The online world is also helping break the mold. Research shows that kids being educated online are as social or more so than their traditional counterparts. KhanAcademy.com , an online learning phenomenon, is attracting millions who are rejecting the didactic preaching/teaching model for a learn-by-doing model. And ColoradoConnectionsAcademy.com is one of many like it springing up online across the nation. Coursera.com , started in 2012, is now offering hundreds of free online classes from dozens of elite universities, giving anyone in the world free access to a great education.

Faster, Please
The traditional Industrialist Age education system works hard to maintain a closed market, and is focused more on destroying the competition than getting better. But the Participation Age and its hallmark of sharing are encouraging the development of a myriad of new learning models that are replacing the old standard. It can’t happen soon enough.

As seen on Inc.com