A Stunning 92% of Companies Want to Reorganize This Year. Here’s Why You Need to Be One of Them.

92% of companies recognize it is time to do something about the dusty old Factory System hierarchy we’re still clinging to. Some amazingly successful companies have already left it behind.

In a 2016 paper predicting the focus of company leaders this year, Deloitte University Press shares this eye-opening conclusion,

After three years of struggling to drive employee engagement and retention, improve leadership, and build a meaningful culture, executives see a need to redesign the organization itself, with 92 percent of survey participants rating this as a critical priority. The “new organization,” as we call it, is built around highly empowered teams.”

The Factory System Still Reigns

The corporate organizational positions we inherited from the Factory System of the Industrial Age exist whether there is a human being attached to them or not. They are power slots in a hierarchy that are to be reached for and accumulated under you.

This model reflects a direct military heritage, communicating exactly which role has more power, command and control than the role below it–CEO (4-Star General), President (1-3 Star General), Vice President (Colonel), Director (Major), Manager (Captain), and Supervisor (Lieutenant).

Giving Everyone Their Brain Back

The Participation Age organization model is quite different. It is based on the idea that people are smart and motivated and don’t need to be managed. Therefore we can flatten the hierarchy, distribute decision-making, and get rid of unnecessary layers of command and control, such as managers:

Factory vs Participation

We know intuitively that this tired old Factory System model we dragged into the 21st century is broken. Our first attempts have been to tweak it, attempting to solve its inherent problems by nibbling around the edges and focusing on red herrings like “empowerment” and “engagement”. But while we’re treating these symptoms, the cause, a medieval military model, remains intact.

The good news is that the early adopters of the Participation Age organization smashed the military model decades ago, and the long-term data is now indisputable. In the emerging work world, those who dissolve the traditional hierarchy and give everyone their brain back will thrive, and those that don’t, will be left behind.

They’re Everywhere

Hundreds of very large companies with 5,000 to 65,000 Stakeholders and thousands of smaller ones have been operating without a military model for 60 or more years. And their numbers are growing quickly. These companies are identified by a rejection of command and control hierarchy, and by distributing decisions to the levels at which they will have to be carried out.

Leading Without Managing

Such organizations don’t have any people who manage other people. Instead, they organize around teams of people who, in the absence of a manager over them, take over all the traditional functions of management, and distribute them to members of the team.

These teams decide who they will hire and fire, how to discipline themselves, and their metrics for success. They agree with leadership on the result needed, then design their own processes to get that done, something a manager used to do. In many cases they even determine how to distribute pay amongst the team members.

Old Eyes, New Eyes

Anyone looking at this through the lens of a traditional business hierarchy sees chaos and anarchy. Yet every example of it in the real world results in faster growth, better margins, higher productivity, exponentially lower staff turnover, tighter processes, and better products. And yes, people with no business education, such as dock workers at The Morning Star Company, can manage themselves to higher levels of success than if they had a supervisor. There is no data on the side of the traditional military hierarchy in a business setting (even the military is questioning it these days).

So why do companies still do it?

First, because they don’t know what else to do. For over a hundred years, colleges have taught the Factory System model as if it was the only and best way to do business. It is neither. Rehumanizing the workplace and giving everyone their brains back works better.

Second, those who love command and control fear losing it, even though the result would be undeniably better for the companies they run (it’s not about the company, it’s about me).

Third, leaders fear a big dip in performance on the way to cleaning up the hierarchical mess. They are thinking, “It may not be optimal, but it’s working well enough as is, and we have pressure to perform this quarter.” The reality is that it doesn’t have to be disruptive at all. In most cases, if implemented correctly, a Participation Age model can result in immediate upticks in all the traditional metrics of success.

A Better, Simpler Way

The Deloitte research has revealed the obvious; we know that hanging on to the tired Factory System hierarchy isn’t working. It isn’t the only, or the best way to organize. There is decades of data that proves a flatter, more distributed model of power, decision-making and leadership works better, for both the organization and the people who work there.

There is a tidal wave of companies moving in this direction. Will you be one of them? The data is in–those who adopt the Participation Age model will thrive, and those that don’t will be left behind.

Article as seen on Inc.com

New Study: Stop Chasing Money. You’ll Be More Successful Pursuing a Big Why

The Industrial Age factory system designed work around making money. But people who work for a bigger reason are happier and better paid.

A new study, the 2015 Workforce Purpose Index, reveals that 28 percent of people are purpose-oriented, identifying them as “the most valuable and highest potential segment of the workforce, regardless of industry or role.” We call this a Big Why: something that is bigger than making money, that you can never check off as complete.

The 28 percent who express this Big Why approach to life are motivated by two things:

1) Personal fulfillment

2) Serving others

In contrast, the other 72 percent are motivated by

1) Status

2) Advancement

3) Income

Everybody Can Be Purpose Oriented

Some surprising things stand out in the study. The 28 percent don’t make less money than the 72 percent that are money-motivated. They also come from across every industry, every imaginable job type, and every age demographic.

The research says, “By every measure, they have better outcomes than their peers.” They:

– Are much more fulfilled at work

– Do better work and get higher evaluations

– Have much longer tenure in their companies

– Are bigger fans of the company

– Are much more likely to become leaders (and make more money)

The Joy Is in the Pursuit

People in the 72 percent can and do change, but that change usually comes quickly, not over time. A lot of people in midlife seem to wake up and decide they need a bigger reason to be alive than just making money or having a fancy title. The study points to a life principle that too few of us discover. In our business, we say it like this:

The joy is in the pursuit, not in the acquisition.

In grade school, I remember buying a tiny battery-operated beach radio. It was cool for about three months. Then I wanted a bigger one. Over 20 years, I bought a half dozen or more stereos, with increasingly more power, features, and quality. I continue to look at more expensive ones, but I have had a lot more fun pursuing the next one than acquiring it.

A Big Why gives you reasons to do things that you’ll never be able to check off as complete–be a great mother, get involved in a nonprofit, help others get to where they need to be in life. A Big Why isn’t necessarily a huge Why, like solving world hunger (although it can be). Instead it’s a continuous Why–one that will get you out of bed when making money won’t.

Workplace Engagement Is Unrelated

The study also clarified that purpose-orientation is much different than the too-often-used buzz phrase “workplace engagement.” People with a Big Why don’t need anyone to motivate them to be engaged. You really can’t motivate them; all you can do to them is keep them from being engaged at work (they’ll leave if the work environment stifles their purpose.)

Three Reasons to Be Purposeful

In my first book, Making Money Is Killing Your Business, I outlined why purpose-orientation works better than stuff orientation:

1) Making money is not an empowering vision. People who have a bigger reason to work than making money tend to make a lot more of it.

2) A goal realized is no longer motivating. The joy is in the pursuit, not in the acquisition.

3) We are made to be and to do something significant, our whole lives, not just the first two-thirds. There is something for everyone to chase that will get them out of bed every day, that is bigger than making money.

What Does This Mean for Business?

The study recommends that you create partnerships with people, not treat them like “resources.” And employers should measure how work is helping their people in the areas of relationships, personal impact, and growth, not status, advancement, and income.

The bottom line: There is a new war brewing for a very different kind of talent–purpose-oriented people–and companies are scrambling to figure out how to develop hiring mechanisms to find these people.

You could be one of them. This year, intend to be purpose driven. Get a reason to go to work that is much bigger than making money, that is motivating both at work and at home, and that drives you to get out of bed during the tough times. You’ll be more fulfilled, build better relationships, be more likely to advance, and still make as much or more money than someone chasing status, advancement, and income.

The joy is in the pursuit, not in the acquisition. Get your Big Why in 2016, something you can never check off as completed, and run with it.

Article as seen on Inc.com

2 Words That Will Change Everything About New Year’s Resolutions

I hereby resolve… yeah, there’s a better way.

First the bad news on New Year’s resolutions – Only 8% of people who make a New Year’s resolution keep that commitment. Worse yet, if you’re making a dieting resolution, you have a 5% chance of keeping the weight off, but an 83% or higher chance of gaining back more than you lost. Research shows that resolving to lose weight is actually an indicator you are going to GAIN weight!

Now the good news. You get what you intend, not what you hope for. Change can be real and lasting.

The Random Hope Strategy

Most New Year’s resolutions are built on the random hope strategy of life–if I think and feel something, who knows, I might get motivated enough to do something about it. A very few resolutions, 5-8% are built on something very different than random hope–intention. Intention is different than expectation. Intention assumes I’m going to have to work my ass off, but if I do, I’m very likely to get what I am chasing.


There are two words that describe why 92% of people don’t keep their resolutions and why the 8% do. First, if you really want to keep your resolution, you’ll learn and embrace the word “conation”.

Conation is the most important, least known word you’ll ever learn about success (we use it as a foundation for helping business owners succeed). Conation is

the will to succeed that shows up in single-minded pursuit of a goal,

or, “Get out of my way, I have somewhere I need to be.” Conative people actually don’t have to tell people to get out of their way. You can see the determination in their eyes, and you just step aside.

In the 1970s my Mom was a three pack a day smoker. A doctor told her she had pre-cancerous lesions on her larynx from smoking, so that day she quit and never smoked again. She didn’t need a New Year’s resolution or another week to get her last few smokes in. There was even a full case of Kools in her smoking drawer for another few years before she finally threw it away.

Mom’s actions were classic conation. As soon as she knew what she should do, she did it. No ceremony, no waiting period, no walking on coals, chanting at a vision board, or hypnosis. Conation is defined by this–as soon as we know what we should do, we start doing it. Realizing the need is directly followed by action.


Can you see why New Year’s resolutions don’t work? We “resolve” in early December that we need to do something on New Year’s day, while binging on whatever we know we should stop; a sort of extended Mardi Gras that clearly demonstrates we don’t actually want to do what we say we want to do. This brings us to the second word–velleity (vah-lay-ity).

Velleity is the second most important word around being successful and is the direct cause of why 92% of resolutions fail. Velleity is,

the desire, with no intention of doing anything.

Wouldn’t it be nice if…? Someday I’m going to… I sure hope that… – It’s all velleity. We fool ourselves into thinking we actually want change because the emotional desire is so strong–“I really do want it!”. But it’s just emotional desire, with no intention of actually doing anything.

Just Priorities

I can see why Mom was able to be so conative. She once told me, “Chuck, there is no such thing as excuses, there aren’t even reasons, there are only priorities.” Conation is built on deciding that something (losing weight, stopping smoking, being a better husband, etc.) is more important than something else (food, nicotine sedation, being self-absorbed, etc.). It’s all about priorities.

For every well-intentioned resolution to lose weight, stop drinking, call Mom, get sober, be more helpful, control your temper, or finish installing the molding in the kitchen, there are unconscious commitments to keep things exactly the way they are right now. But velleity gives us the cover we need to think we actually want change. The emotional desire to see things differently (velleity) passes for real desire to change something, which results in immediate action (conation).

The Only New Year’s Resolution That Will Actually Change Something

Here it is:

I hereby resolve that going forward, I will never again wait for some future date, including New Year’s Day, to do something I know I should do. I will be conative and decide that anything worth changing, is worth changing as soon as I recognize it, and that any time I want to put off that change, I will remind myself of velleity–the emotional desire, with no intention of doing anything.

Or the short version:

I know I want to change something, because I’m already doing it. Everything else is just velleity/desire.

Remember, there are no such things as excuses or reasons, just priorities. If it’s important enough to change, I will do it now, not later.


Be part of the 8% who succeed – resolve to be conative in 2016. It can change your life!

(Pssst – Don’t wait for New Year’s Day to resolve to be conative. Waiting is just velleity.)

Article as seen on Inc.com

9 Sure-Fire Ways to Give Yourself the Finger and Wreck Your Business

You might be giving yourself the finger and not even know it. Don’t look back and realize all you needed was to get the other four in line with the one in the middle.

In 2000 we were building a fast-growing fulfillment and logistics business. I was a minority partner and had expressed my concern that we should get some backing. The majority partner felt no need to do it, even though we had an angel investor who wanted a very reasonable piece of the action.

We had some pretty nice names on our customer list, Sun Microsystems, TAP Pharmaceuticals, Johns Manville, Seagate, and a host of other not-so-large companies. After I landed a huge contract with Microsoft my partner came into my office and said, “See, aren’t you glad we didn’t take on an investor?” I replied, “No, in fact, if we don’t get one soon, we could go out of business.” The angel investor brought back an even sweeter deal my partner refused to take.

The business had grown by 420% in three years, yet even with a great profit and loss statement, we had to sell the business within nine months of landing the Microsoft contract. It was a bitter lesson. Even in a great business with wonderful growth, when one part of the business is out of balance with others, it can sink you.

Giving Ourselves The Finger

For us, it was cash flow. We had great profit on paper, but it was stretched out all over the business, and we learned the faster you grow, the less cash you will have in your bank account. It’s the most common killer of businesses.

But there are plenty of ways to spike your business, most of which will sneak up on you by looking like a plus, when they are really a minus. It’s all about balance.

Contrary to common belief, most businesses don’t go under for lack of customers. In fact, it’s almost always the opposite. The number one reason businesses fail is because they grow too fast, or more specifically, some element of the business outpaces the others. Unbalanced growth will put you out of business faster than anything else.

Krispy Kreme has been selling donuts since 1934. In 2000 the company went public and grew 840% in just three years. The stock peaked around $50 per share and then in 2003, started a free fall because the market was over-saturated with Krispy Kreme donuts. In 2009 the stock was at $1.09. The company’s production had outstripped the market demand.

Imbalance Has No Bias

I’ve seen this “unbalanced growth” issue with companies of every size. It respects no boundaries. A real estate agent can get in trouble with too much marketing and not enough cash flow. An Internet store can get in trouble with too many customers and too few suppliers. The entire airline industry is despised because of its focus on profit and a complete abandonment of customer service. This has resulted in huge growth for Southwest Airlines, which balances profits and customer service.

Ways to Give Yourself The Finger

Here’s just a partial list of things that, if not in balance with each other, can put you out of business:

Cash flow – never too much; feel free to be out of balance and be flush!

Staff – very costly to have too many OR not enough–balance!

Production – too much is expensive; too little hurts quality and/or growth

Customers – too many will cause all kinds of bad decision-making

Suppliers – production can be halted by a simple missing part

Cash flow – the #1 way to be out of balance

Facility Space – don’t bite off more than you need (or less)

Products – most often, too many can kill you; rarely, the issue is not enough

Leadership – stop micro-managing, allow & require others to decide things

Culture – “Culture eats strategy for lunch.”–Peter Drucker

Management – gut the management layers; rely on self-management

Cash flow – yes it’s on here three times; it’s that important

Cashflow Finger - the good one

Are You Paying Enough Attention?

What is your imbalance? We’re always fighting one–it’s never not an issue. No matter where you are in the business cycle, you have too much of something, and not enough of something else. And it’s not always easy to see. Take leadership as an example. Too much micro-management and not enough distributed decision-making causes good people to leave, leaving behind unmotivated “responders” who do only what they are told. It could take a year or more to wake up to that.

Grow, Baby, Grow!

Fast growth by itself is never a problem. You can grow incredibly fast as long as you make sure all aspects of your business are growing in balance with each other. But remember, lack of cash flow will put you out of business faster than any other type of imbalance.

By the way, all of this applies to your personal life, too. Read The Power of Full Engagement.

Watch Your Shop

Only the paranoid survive. Don’t give yourself the finger. Stay vigilant, stay balanced, and you can grow as fast as you want. Keep growing!

Article as seen on Inc.com

Pivotal Labs Finds Success With Self-Managed Teams

Pivotal Labs doesn’t talk about not having managers or use the term “self-management”. They just do things this way because it works so much better.

For Pivotal Labs, the only reason to have a process is to get a result. Productivity is the mantra, and it’s all based on three simple, core values: “Do what works,” “Do the right thing,” and “Be kind.” But wait, where are the managers? Oh, that’s right, there are none.

Addition, Not Subtraction

Pivotal Labs never tried to reduce or get rid of managers or create “self-managed teams.” Instead, CEO Rob Mee, who co-founded Pivotal in 1989, based his culture on extreme programming, and designed the most efficient project team structure for getting things done fast and well. It’s focused on “balanced teams,” and managers were never part of the mix. And it worked.

Today, Pivotal has over 2,000 staff members in nearly 20 locations around the globe. Clients like Twitter, Mercedes, GE, Philips, Humana, and Southwest Airlines lead a Who’s-Who list of companies that have benefited from Pivotal’s commitment to results over process. And their technologies and tools touch billions of users every day.

Pairs, Teams, and Generalists

Pivotal Labs structures their workplace very simply, with teams of people working on projects together. Pairs of programmers switch out almost daily to work with other people and on other projects. Cross-functional pairs can also be comprised of user experience (UX) and user interface (UI) designers, product managers, and engineers. Rejecting the specialized assembly line method, there is an emphasis on everyone learning how to do everything. Mee says, “At Pivotal, every developer works on every level of the system, from HTML and JavaScript to Ruby and down to the database. The argument that specialists will be better at a particular layer of the system if they’re allowed to focus on it doesn’t really hold water.”

Shaping Cultures, Not Just Building Apps

The company’s success speaks loudly to that belief, and others have taken notice. Pivotal has been credited for shaping the cultures of some of Silicon Valley’s most influential and valuable companies. This is a result of their own belief that building better software is as much about creating a better culture as it is about creating new products. So companies regularly reach out to Pivotal not just to build an app but also to get help with rebuilding their own software development cultures.

Productivity Drives the Absence of Managers

Pivotal Vice President Drew McManus says, “Few software companies truly operate as self-managed workplaces. Putting agile development principles into practice is harder than it looks. It’s not about Ping-Pong tables in the break room, but about productivity. Rather than providing Ping-Pong or other games as a ‘perk,’ they are used as strategic breaks from staring at computers by employing other motor skills. People are happiest when they are being productive, and productivity drives everything we do here.” Which is why they don’t have managers.

The idea isn’t new. In the late 1950s, Bill Gore created his company, W. L. Gore and Associates, to produce Gore-Tex fabrics and other great products. Today, Gore’s revenue is north of $3 billion annually, and it has over 10,000 staff members. Gore called it the “Lattice Organization”-if you need something from someone, go get it. Pivotal Labs didn’t study Gore, or any of the thousands of other companies running without managers. They focused on getting the best result as fast as possible, and simply arrived at the same conclusion: most corporate layers slow things down without adding value.

Empathy-Based Teamwork

But Pivotal isn’t a rugged individualist culture, either. They don’t hire programming “unicorns,” working in the middle of the night propped up by caffeine, headphones, and Doritos. If you can’t program in pairs and work as part of a team, Pivotal won’t hire you. Again, Rob Mee addresses this myth. He says the most important thing they hire for is “empathy.” “Collaboration is the most important thing we do, and it doesn’t matter how smart you are if you can’t relate to how other people think.”

Janice Fraser, director of innovation practice, says a group of people built the concept of balanced teams together in 2010. “For the best outcome, ownership should be with the team, not with one person,” she notes. As a result of the work environment they’ve built, McManus says, “Pivotal’s best sales tool is the tour, because they see people working without managers. Large corporations say, ‘I want this. Come show us how to do this.'” They’re not just writing software, they’re helping change organizational structures from traditional top-down hierarchy to teams without managers.

Conversations, Not Communications

Every company struggles with communications, but Pivotal approaches it differently. Fraser says, “Our organization is built to create conversations, not just communications. Word of mouth is the best way to communicate. So we give people lots of landing spaces and encourage interaction.” To put feet to creating conversations, Pivotal provides free breakfast every morning and everyone takes lunch at exactly the same time. They also work from “stories,” not architecture, which also facilitates conversations. “Our office sounds like an bustling caf,” says McManus. “Face to face conversations are encouraged. Pivotal Tracker also triggers conversation. Live interaction saves us a lot of time. It happens ad hoc, so we have very few meetings.”

Part of building a culture of conversation is ongoing “AMA” (ask me anything) sessions with leadership. And sideways communication is facilitated by software they developed called Feedback, short tweet-like shout-outs with timely responses. All of it is designed to eliminate latency between identifying an action item and completing it.

Trust Is Everything

Fraser sums up Pivotal’s unique culture, “Think about who else will be affected and get them involved. We all strive to act like grownups. Balanced teams works on the principle that the right decision is made by the right person who has the right information at the right time. It’s all about trust.”

That’s real leadership. And all without managers.

Article as seen on Inc.com

At Nearsoft, No Managers and Complete Freedom Create Responsibility, Not Anarchy

Leaders at Nearsoft believe that when you give people complete freedom, it makes them even more responsible, not less. It’s counter-logical, but actually very intuitive.

Superman Need Not Apply
Nearsoft in San Jose, CA is a fast-growing software development company with nearly 200 developers in the U.S. and Mexico. Roberto Martinez and Matt Perez, the co-founders, aren’t the kind of heroic activists who get featured on the front of business magazines by force of will, command and control, or by building an emotionally charged personality cult. They’ve figured out none of that is a good idea for building a great company in the emerging work world of the Participation Age.

Managerless Responsibility
Nearsoft promotes self-management and runs their company without any managers. Everyone decides for themselves what needs to be done. Roberto says, “Lack of control is the illusion people have. But when you give people true freedom to make decisions, become leaders, or solve problems, it makes them more responsible, not less. This is a very powerful statement. Everyone at Nearsoft is completely free to take care of the important things.”

Nearsoft is an early adopter to the idea that the last 150 years of top-down management was a bad idea when it worked and an even worse idea in a technology-driven world where participation and sharing attract the best people.

In 2006, Nearsoft built their company around two simple but profound assumptions: everyone is an adult and should be treated that way, and everyone wants to be responsible, not just a very few who are “in charge” of others. Julio Gonzalez, head of operations says, “At Nearsoft, leaders encourage everyone to ask questions, not permission. Trust in their desire to be responsible adults is key to our success.”

Managerless, And More Organized
Nearsoft has done a great job of grasping that the profound things are almost always simple. Nothing is complicated in the way they have built their company. But that lack of complexity is many times mistaken for lack of organization. Matt Perez emphasizes the point, “We have a governance structure. That fact that our company is very flat and democratic actually means we are MORE structured than the traditional management model. We have very clear processes for everything we do.”

Ownership By Decision-Making
Clear roles and well-defined processes are consistent with self-managed companies in every industry. The difference is that instead of having roles, responsibilities, and processes foisted on them by top-down command and control structures, the staff themselves determine who will do what and how it will get done. Development of roles and processes by those who will have to carry them out, guarantees ownership of the result. Traditionally managed companies only hope for such “engagement”.

Julio adds, “We even have people get together and form leadership teams to discuss any topic they want, and make decisions. Our entire profit-sharing structure was changed from the bottom up because people took initiative to meet and decide how to make it better. We simply facilitated the process.”

Values Actually Mean Something
Nearsoft runs on five core values: leadership, commitment, teamwork, long-term relationships, and being smart and getting things done. And they have two corresponding principles: transparency and honesty. These are not filler for annual reports, but values that everyone at Nearsoft believes in. Most companies have similar lists, but Nearsoft makes all their decisions based on whether they are aligned with these five values. Very few companies like Nearsoft truly function on an everyday basis from a list of values.

When There is No Manager, Few People Leave
Consistent with all self-managed companies, Nearsoft has extremely low employee turnover. Matt says, “One guy left to be a manager at a traditional company and was miserable. He’s back, because here, even though he isn’t a manager (no one is), he has responsibility and authority. There he was just a spokesperson for upper management. Another woman came back because her employer made her get permission to pick up her mom from an appointment. Here everyone is an adult and doesn’t need permission to take care of their families.”

Work From Anywhere
Part of being an adult is deciding where to work. Sometimes working at home is best and other times coming in to the office to collaborate is more effective. Nobody manages that, the teams decide for themselves according to Nearsoft’s working from home manifesto. Nearsoft adds to that trust in adult behavior by giving everyone the option to work from anywhere in the world for up to a month, twice a year.

Employee engagement is an ongoing buzzword problem with most companies. Nearsoft advances the idea of self-management as a key to solving that problem. And thousands of companies like them, in every industry, are moving quickly in this direction.

Give People Their Brains Back
Nearsoft’s story is a powerful lesson for all companies. If you want to grow quickly, increase profits, reduce unproductive middle management layers, and keep your best and brightest people, you might want to give them their brains back and require that everyone become a self-managed adult at work.

Article as seen on Inc.com

DaVita: a 65,000 Person Corporate Village, or Just a CEO’s Nutty Dream?

What if a global business was not a soulless profit machine, but a community, a “village” where everybody had a brain, made important decisions for the corporation, and promoted and lived in community? Could it work? It already is, and we can all learn something important from them.

In 1999, a company called Total Renal Care, a kidney dialysis provider, was nearly bankrupt. In October of that year, Kent Thiry took over as CEO and started the long road back, taking a very different course than traditional turnarounds.

Instead of a classic top-down, heavy-handed strategy, Thiry and his leadership team set a seemingly crazy course to build a more democratic company where everyone helps to make the important decisions together. Instead of telling everyone where the company needs to go, the leadership invited everyone to lead, and to work together to figure out how to right the ship. They call it the DaVita Village, and people aren’t employees, they are teammates or citizens. Sounds really squishy, but the results are dramatic.

Much of what they do flies in the face of classic MBA teaching, including how they changed their name. In 2000, thousands of teammates worked on it together and decided in a vote to become DaVita, which means “he/she gives life”. It is one of a fast-growing number of companies discarding over 100 years of management theory to try something new—asking everyone to participate together in building a great company, not for the CEO, but with him, as co-leaders, not followers.

And it’s working. DaVita’s revenue has exploded from $1.5 billion in 2001 to $12.5 billion last year. By every other measure DaVita is the kind of huge success that proponents of old-fashioned management claim can’t happen without strong, top-down command and control. Thiry and his team have rejected the classic approach, and instead created a wildly successful company by believing that the principle of shared decision-making involving everyone, will be better for the company, the customers and those who work there.

A radical new direction requires changes in core beliefs. David Hoerman, the chief wisdom officer at DaVita, says, “Our beliefs drive our behaviors, which drive our results. When we all share the same beliefs, the right behaviors follow that benefit our patients, our business and beyond. We call each other on our behaviors that don’t align with those beliefs.”

That is a key statement. DaVita has seven simple core values: Service Excellence, Integrity, Team, Continuous Improvement, Accountability, Fulfillment, and Fun. These values aren’t uncommon. Management teams regularly develop such a list, but that is exactly why they don’t have any impact, because management developed them. At DaVita, these seven values were developed by and voted into existence by the teammates. This is a simple, but dramatic departure from the norm, and explains why these values are held so deeply at every level. The simple principle DaVita employs is that those who are most affected by a decision should have a say in that decision. And when they do, they will own the outcome. In this case, everyone owns DaVita’s values because they were voted on by the people.

To encourage ongoing participation and decision-making, DaVita has a Voice of the Village call for the whole company every six to eight weeks, to listen, get ideas and feedback, and give advice on things that affect everyone. They also have online vehicles for the same purpose.

Hoerman says leaders at DaVita focus on serving others and supporting their teammates in developing their own ability to make decisions. Again, leaders say this all the time, but it’s usually lip service. Not at DaVita. “My job as a leader here is to create an environment where our teammates can step up as leaders and make good decisions.” The art of leadership is to know how few decisions the leader needs to make.

Why is all this involvement of the people who work at DaVita so important? Because the simplest way to get everyone engaged is to promote ownership, and decision-making is the principal way a company can motivate people to own their work. Vince Hancock, another leader at DaVita summed it up well, “Ownership is really important here—nobody washes a rental car.” As a result, Hancock calls DaVita “a shockingly egalitarian place.”

Hoerman says leaders at DaVita focus on serving others and supporting their teammates in developing their own ability to make decisions. Again, leaders say this all the time, but it’s usually lip service. Not at DaVita. “My job as a leader here is to create an environment where our teammates can step up as leaders and make good decisions.” The art of leadership is to know how few decisions the leader needs to make.

Why is all this involvement of the people who work at DaVita so important? Because the simplest way to get everyone engaged is to promote ownership, and decision-making is the principal way a company can motivate people to own their work. Vince Hancock, another leader at DaVita summed it up well, “Ownership is really important here—nobody washes a rental car.” As a result, Hancock calls DaVita “a shockingly egalitarian place.”

DaVita’s lesson is simple, but not easy. They call their culture The DaVita Way—and together, they’re dedicated to building a healthy village and caring intensely about each other, their patients and their communities. At the core of this intense caring is encouraging everyone to bring the whole, messy creative person to work, own their decisions, and participate in building a great community. To make that happen, DaVita leadership allows and requires decisions to be made where they are carried out, and then they get out of the way.

While others are still relying on a few heroic activists to tell everyone else what to do, DaVita is inviting everyone to participate. Giving people their brains back is working for DaVita, and is a way of leading all companies could learn from.


Article as seen on Inc.com

How To Get Off The Treadmill and Never Have a Bucket List

There is a good explanation for why we get stuck trying to simply make money and rarely get around to building a life that matters. We are constantly fighting to balance two opposing daily realities: The Tyranny of the Urgent vs. The Priority of the Important.

Two Opposing Realities
Almost universally we let the Tyranny of the Urgent keep us from paying attention to the Priority of the Important, and as a result, we will never get off the treadmill.

The Tyranny of the Urgent
The Urgent things fly at us all day, everyday, causing us to live reactively and defensively as we hold life together as best we can. The Urgent things are tyrannical—they try to rule over us. Like small unruly kids, they scream and yell, poke and prod, and are relentlessly in front of us.
We don’t have to go find the Urgent things—they find us and rule over us. Overtime we resign ourselves to the notion that this is normal because everyone else around us seems to be doing the same thing. Welcome to the Treadmill.

The Treadmill of Making Money
One of the most Urgent daily tyrants is the need to make money to cover today’s bills. Think about it. That great-looking house, those shiny objects, and that expensive hobby quickly turned into a relentless liability to your cash flow.

Early on this taught you that the “clear and present danger” in life is not having enough money. So from the start you went in search of making money, with the idea that “later” your focus could shift to Making Meaning. But overtime you’ve gotten used to this pressure and have forgotten the excitement of pursuing a life of significance. You might now actually think the goal is itself just to make money.

See how the Treadmill has trained you?And because everyone else is doing it, it seems normal and natural—just the way it works.

But, it’s a dead end.

The Priority of the Important
In stark contrast to the Tyranny of the Urgent is the Priority of the Important. The Important things sit quietly and patiently in the corner and whisper,“I’m really Important. I can help you Make Meaning, not just money. Let me know when you have some time.”

The Important things require us to be proactive because they almost never seem urgent—things like thinking about what next year should look like, and what I really want out of my work and my life. We don’t make money today doing those kinds of things, so they don’t seem Important, and they’re definitely not as urgent as paying the bills.

Which do you want? Riches you don’t have time to use, or Wealth that allows you to live the life you really want? If you focus on the Tyranny of the Urgent and save the Important things for”later,”your best hope is that you will make money, and never as much as you could or should. But if you focus on the Priority of the Important now, you’ll be on the road to real Wealth:freedom. And freedom is the best evidence I can come up with that you are off the treadmill.

The Treadmill vs. A Life of Making Meaning
The Tyranny of the Urgent keeps us focused on making money—the classic treadmill. The Priority of the Important helps us focus on Making Meaning.

Don’t get me wrong. You have to make money. The problem is that we lose focus on why we want to make it. People who focus on making money rarely make a lot of it. People who focus on something bigger than making money, who see money as simply a resource, are much more likely to make a lot of it.

We all know this and are nodding yes. But right now we don’t have time to start proactively designing our future. We have urgent, pressing needs that must be taken care of first. Once we have those covered, we promise ourselves we’ll dive into building a life of significance. Except later never comes. The saddest statement in life is “I wish I had…”, but the second saddest is, “Someday I’m going to…”

Free Beer Tomorrow
The sign in the bar gets us to come back a couple days in a row before we realize tomorrow never comes. When I was in my twenties, a wise old sage said to me, “Chuck, life has a built-in problem. There are three resources, time, money, and energy, and unless we make it happen, we will never get all three at once. When I was your young age, I had all the time and energy, and no money to do anything about it. When I was in my forties, I had all the energy and all the money, and no time to do anything about it. And now in my later years I have all the time and all the money, and no energy to do anything about it.”

No Bucket Lists!
Later never comes. Go get time and money while you have the energy to build a great life. A bucket list is a dumb idea. We have to proactively figure out the very few Important things and people that matter, and prioritize them to the top of our to do list. Once you do, you will find that they take care of a lot of the Urgent things holding you hostage.

What are you doing this all for? Figure that out, then actually live life for that.

Carpe freaking diem already.


Article as seen on Inc.com

Successful People Are Peacemakers, Not Peacekeepers

If it weren’t for people, my business would be perfect. Business is sometimes simple; dealing with people is hard. Peacemaking fixes that. Peacekeeping makes it worse.

At any given time, one-third of us are bugged about something someone is doing at work, and Accenture says a stunning 35% of people who quit do so to avoid confronting an interpersonal issue.

There are two ways to deal with an issue: now or later (“never” falls under later). Successful people do not live passively, just hoping stuff will work out. They understand the golden rule of relationships—peacemaking beats peacekeeping every time.

Peacekeepers don’t want to make waves, rock the boat, or risk tension in a relationship. So instead they let a lot of small issues just pile up until there is no choice but to dump the truck. Instead of dealing with each “border skirmish” as it comes up, they ignore them until they find themselves in World War III. Peacekeepers are more concerned about present peace than long-term relationships.

Peacemakers understand that dealing with issues as they arise keeps them small, keeps the slate clean, and builds an environment of trust where no one is waiting to be blind-sided by someone blowing up at them. Peacemakers always have the other person’s best interests at heart, and are willing to confront small tensions in order to ensure no big ones can fester and explode.

Here’s a short list of common things we tend to ignore in order to keep the short-term peace. See if you find one you’re ignoring right now:

You’re micro-managing me.

You lack initiative (or productivity).

I’ve screwed up (being vulnerable).

Nobody respects you, they just fear you.

You’re too much of a victim at work.

You’re very productive, but a lone ranger.

You’re more interested in beating the other guy than producing.

Here is why I chose Tom for that project and not you.

You’re gossiping, please stop.

We have to let you go; here’s why.

Peacekeepers find someone else (usually a manager) to deal with their problems. In our company, no one is allowed to talk to anyone else about interpersonal issues they are having with someone. If you have an issue with someone, you need to deal with it, not pawn it off on someone else, which we view as gossip. The rule: If you are not part of the problem or part of the solution, it’s gossip. Be an adult and talk to them yourself.

Here’s seven steps to Peacemaking:

1) Where? For a difficult conversation, pick a neutral location, not your office. And don’t discuss hard things over food. Work through some possible anxious moments without other distractions.

2) Motive? Do you want them to respond and change, or do you want to squash them? If you get excited about how this conversation could help that person grow, you will approach it differently. And you won’t go in angry “for the kill”, but empathetic “for the change”.

3) Clarity? Be clear about the issue, and stay focused on it. Choose one thing and don’t be pulled off of it by the conversation. Successful people confront one thing at a time—pick your battles.

4) Listening? Don’t assume. Ask questions and be prepared that they will have a completely different view of the situation than you. You might change your whole “spiel” once you listen.

5) Your Responsibility? Did you play a part in causing the issue? Or is your responsibility simply to be Outside Eyes and give them a different perspective than their own? Own up to your own stuff.

6) Fear? Peacekeepers fear not being liked. Peacemakers focus on how the other person might benefit from the discussion, and also understand that putting it off to be liked now is probably going to make it a bigger deal later.

7) Continue? Maintain the relationship—sometimes you can’t, but do your best to share the issue in a way that allows you both to leave the conversation with dignity and continue talking later. Nobody is supposed to win or lose, we’re supposed to grow.

Successful people are Peacemakers, not Peacekeepers. It may be harder in the short run, but it’s always easier and more beneficial in the long run.

Article as seen on Inc.com

The Degeneration of the Handshake, and Why It Matters to You

Is the handshake devolving? Is there a business opportunity here for those paying attention? Just maybe — on both accounts.

The handshake originated as a sign of mistrust. The modern handshake is said to be traceable to medieval knights who physically shook the hand up and down to shake loose any weapons. But in the centuries that followed it turned into a sign of trust and friendship, and was also regularly used as congratulations for promotions, weddings, or winning something. But is all that changing?

The rise of the impersonal greeting.
Since the 1960s I’ve watched an evolution, or maybe devolution of the handshake — not sure. Each new “style” seems less and less personal. In the 60s I saw clever new ways to touch hands and fingers before or after the handshake. Then it became a quick hand slap with no clasping, and sometimes some clever finger snapping while not touching. Then came the elbow shake — no hands involved. It didn’t last long. Then the high-five took over and has evolved into a victory slap of some sort. (There was a low-five for a while, but it took too much energy.)

More recently athletes developed the chest bump, which requires no involvement from the hands or even the arms. Those of us walking around on the streets couldn’t get the timing right, so we resorted to the fist bump, which even the president uses a lot. Now greetings have become so impersonal that you see athletes jumping to touch back-to-back — you don’t even have to look at each other. (Do not try this on the subway with a stranger — again, timing is very important.)

Does it mean anything or say anything about where we are as a culture? Maybe; maybe not. Could be that it’s just a way to relieve boredom with the way things have always been done. But there might be a warning in it for us businesspeople. I’m not sure where it will go from here, maybe to a version of greeting that requires no touching at all. Oh, wait a minute, I think we call that “the internet.”

The most impersonal handshake — digital.
I run across people all the time on the internet who are convinced they don’t have to be human first; that if they make a data contact, that’s enough.

I connect with almost every real human who asks to follow me on Twitter, Facebook, or LinkedIn. Maybe I shouldn’t, but it seems friendly, and we might actually get to know each other. I’ve got great relationships on a number of continents from becoming interested in what others do on the Web.

Friendly person — not.
But almost every day now I get “Sales Guy” trying to contact me (not connect — that would be too personal), by disguising himself as “Friendly Person.” Today I accepted an invite on LinkedIn, and within a few minutes I got this message, which is similar to ones I get every day:

“Thank you for connecting with me on LinkedIn. When would be a good time to hop on the phone and discuss the potential business opportunities between our two companies?”

To which I replied:

“After we build a relationship, which doesn’t seem likely.”

What makes people think they can say hello and then start selling me something? If you meet a person in a bar and ask them to marry you right there, what are the odds they’ll accept? (If they do, you deserve each other.) Relationships take time to develop. The more impersonal your connection with me, the less likely I am to buy anything.

Hugging, not bugging.
Which brings me to the point of this rant. As an entrepreneur who’s started and built ten businesses, I’ve found the following axiom works really well to build your business:

The closer you get to a hug, the more likely you are to sell something.

Please don’t digitally shake hands with me from 1,000 miles away and expect to sell something because you’ve found a door to my computer. Which brings me to the second axiom that seems to work in the emerging world of the Participation Age:

Serve, don’t sell.

Meet me where I am, not where you are.
If you manage to find a door to my computer, your first interaction should be to figure out how you can be interested in me and what I’m doing, and how you can serve me. Hint: It almost always has nothing to do with your stupid product.

Simple rules: Don’t contact people, connect with them. Don’t sell them, serve them. Build a relationship by meeting them where they are at, not where you want them to be. Someday, if you do, they might actually need one of your widgets and come running to you to buy it, because you are their friend.

Take the long, patient road to my wallet that goes through my heart. We’ll all be happier.

(Feel free to refer people to this article who don’t get it — glad to explain it to them.)

Article as seen on Inc.com