Menlo Innovations: No Bosses, No Titles, and No Offices, Just Trust, Relationships and Pure Joy

In 2001, two tech guys decided to build a company around the daring vision, “to end human suffering in the world as it relates to technology.” It isn’t a tech story at all, rather a story every company in the world should study and embrace, to end their own corporate suffering.

Great companies always coalesce around a few simple, clear values to find their true north. Others wander in the deserts of competition, market fluctuations and reactive business models seeking revenue. Menlo Innovations, with a staff of around 50, in downtown Ann Arbor, Michigan, is as focused on a few simple values as any company in the world, and their results reflect that tenacity.

Joy in the Workplace

James Goebel, the operations leader, put it succinctly to me. Menlo Innovations is about, “Joy, for us, and most importantly for the end user of every software product we build. Joy is a necessary workplace ingredient. Happiness is geared around pleasant feelings, but joy can be achieved by common suffering around a common obstacle. Like how to build a product that creates joy.” James compared it to a friend who ran a marathon – “He wasn’t happy while he ran, he was in pain. But he was joyful through the whole process.”

Deep, but true. Happiness is based on a positive emotion, joy is based on a positive experience, no matter how hard. Menlonians focus on a positive work experience and a positive experience for the people they serve in the world, not ping-pong tables or outrageous desk displays. They are all expected to work a maximum of 40 hours a week and go home. Joy in the workplace means working more on joy at home.

The company founder, leader and architect of such joy, Rich Sheridan, wrote the book on joy, literally. His best-seller Joy, Inc., How We Built a Workplace People Love, should be mandatory reading for anyone in leadership in any company. It describes a company built on trust, transparency, and self-managed teams, with no bosses, titles, offices, promotions or other traditional corporate trappings.

Joy in Leadership

Rich told me, “We differentiate between bosses and leaders. There are no reporting relationships. But bossless doesn’t mean leaderless. People have to learn to lead through influence, not command and control. Bossing creates a false illusion. It’s easier, but the reality is that even though they are doing what they are told, I’ve lost them.”

Joy through Trust

Trust is a big deal to Rich Sheridan, and to all Menlonians. Rich sits right out in the bullpen with everyone else. No offices means no offices. The focus is always on building relationships. James agreed, “We have to identify sources of fear and drive them out. It’s amazing how often we do something that creates fear, and people then will not operate at high levels of intelligence.” If only most companies understood this.

Outdated factory system hierarchy does not lend itself to trust, by the very nature that the boss can fire you any time they want. Nobody at Menlo Innovations carries that power. Teams hire, teams give feedback, teams promote, and teams fire. At Menlo Innovations, teams have taken over everything that classic command and control managers used to do for them.

Joy in Pairing

Menlo has a unique team structure, even for self-managed companies. Kealy Opelt and Ted Layher were two programmers who talked with us together, because at Menlo, programmers don’t do anything as individuals, even interviews. I asked, “What’s something your company does that makes your culture unique?” and the answers came pouring out.

Kealy jumped right in, “Rigor around programmer pairing. Many companies suggest pairing, but we live by it. Ted agreed, “It’s always two people on the same task, programming together, billing together, and reviewing code together. Two brains are always better. In the past if I got stuck, I would just sit and be stuck. But at Menlo, my pairing partner always has an idea to keep us moving.”

Partners are assigned every week. Nobody gets picked last to play softball. Ted explained, “We transfer our knowledge to the next pair, or sometimes one of us stays on the code we wrote the week before. We’re all in one big room, sitting together, with chairs on wheels so we can transition easily.”

Joy in Babies

Kealy mentioned crying babies. “Moms and dads can bring their newborns to work for the first few months. Everyone thinks it will be a big distraction, but a crying baby is a problem for a minute, then they are in the parenting room for a change, then when they are happy again, they are back with us. Parents are sensitive.”

Joy in Hiring

Hiring is simple. No resumes and no interviews. Applicants work in three different situations with three other applicants for a couple of hours while Menlo staff members watch for good kindergarten skills, then the next step is a whole day with Menlo staff, doing work. It’s all about pairings. “The prima donna programmer doesn’t work here.” Ted explained.

Joy in Self-Management

In classic self-managed fashion, the teams vote on everyone’s salaries, and they do it in front of everyone, something that only deep trust could sustain. Kealy elaborated, “If I think it’s time for Ted to move up (there are 15 pay grades and everyone knows what everyone makes), I need to get with a lot of other team members to agree. It’s all by conversation. Or ‘improve here, then move up.’”

They don’t claim the self-managed process is perfect, just a lot better than having a manager decide things. Peer evaluation and peer review. No bosses. It’s more work, but they feel strongly that it’s worth it.

Joy in Results

All this focus on joy, trust, and self-management has worked well for Menlo. The four founders wrote checks up front and never had to again. They’ve been profitable for 15 straight years, and without outside investors.

The hard numbers are great indicators of self-managed success, but Rich unsurprisingly points to other joy-based factors. “I was at a conference the other day and during my talk, one of our folks was sitting in the back listening, and she told me later she had texted her husband to tell him how proud she is to be a Menlonian.”

And then a reference to a recent customer note, “I love our software. What you did for us was wonderful.”

Rich Sheridan didn’t just write a book about joy, it’s a life all Menlonians are living.

Menlo Innovations sets a great example, and begs a great question – What could every company achieve if there was more joy in the workplace?

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