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The Results-Based Culture and What It Will Do For You

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Day 12 of 21 days with Chuck’s new book, Why Employees Are ALWAYS a Bad Idea

There is a growing wave of companies rejecting the front office practices of the 21st century Industrialist. Here’s what a Participation Age company looks like. They come in in all sizes and industries, and are showing us the future of business is already here.

Our company, Crankset Group, has grown 409% in the last five years by building a company on the following business practices:

– Culture is King – Culture is the most important asset in our business. It is who we are at our very core and oozes out of our products and services into every relationship we build. As Peter Drucker said, “Culture eats strategy for lunch.” Great companies do not “have” a company culture. The leadership lives out their beliefs and life principles in their business, and that IS their culture. If our culture is right, we will attract the right people who want to work in that kind of environment. Culture comes from our written beliefs and principles, on which we run our business.

– Vision and Mission – A Participation Age company has a well-defined vision and mission. Our vision: To Live Well By Doing Good. Our mission: To provide tools for business owners to make more money in less time, get off the treadmill, and get back to the passion that brought them into business in the first place.

– Everyone is a leader – Whoever is most effected by a decision should make that decision whenever possible.

– No Promotions – everyone comes in as a “Chief” – Chief Results Officer, Chief Connecting Officer, Chief Relationship Officer, etc. Promotions are time-based constructs of the Industrial Age. Instead of promotions, as people increase their influence in our business, they make more money.

– No management – None of the people at Crankset Group are stupid or lazy, so there is no need for smart and motivated managers. We’re all smart and motivated. Everyone is self-motivated and self-managed.

– Results Based model – We don’t have office hours. People are measured by results, not time spent in a chair. Get your work done and go home. Pay increases are based on the same thing.

– No Vacation Time or Sick Days – Again, get your work done, and go on vacation. We’re all adults and are all owners of our responsibilities, so we can also own our time. We expect people to get more time off than they would in a typical 21st century Industrialist company.

– No Annual Bonuses – Bonuses are “time-based” rewards for occupying a chair for another year. We do “Ad hoc” rewards to reward performance throughout the year. They add up to a lot more than an a bonus and actually mean something to those being rewarded.

– No Annual Reviews – we review each other and how things are going all the time. It makes no sense to store it up to dump it on somebody once a year. We all know how we’re doing throughout the year – no surprises.

– No Annual Raises – As people raise their level of influence and responsibility in the business (they do this, we don’t), we recognize that because raises come ad hoc throughout the years, sometimes a couple months in a row.

– No Departments – people don’t “belong” to someone or some artificial group.

– Direct Communications – without departments, people don’t have to go through gatekeepers to talk to someone. People who need to talk, do so, and stuff gets done a lot faster as a result.

– Profit-Sharing – within 20 months of joining Crankset Group, people begin to receive profit-sharing. They help make the money, they share in the profits, not just a salary (which the owners also get).

The Bottom Line
Ownership is the most powerful motivator we have in business. Stakeholders are treated like owners and expected to act that way. (Note: Because of that, profit-sharing is non-negotiable in a Participation Age company.)

This is a glimpse into our Committed Community business model. If you don’t work for a company like this, start looking for one. Companies everywhere, in every industry, are leaving the Industrial Age, entering the Participation Age, and embracing similar models. We’ll look at a few of those in the next blog post.

This is a summary of a chapter from Chuck’s new book, “Why Employees Are ALWAYS a Bad Idea (And Other Business Diseases of the Industrial Age)”. Click here to pre-order this new ground breaking book at a discount on IndieGoGo.com until July 28.

9-5; A Business Disease of the Industrial Age

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Day 7 of 21 days with Chuck’s new book, Why Employees Are ALWAYS a Bad Idea

Work is good. It adds meaning to our lives. But work that is done from 9am-5pm is almost antithetical to our natural understanding of work. Mary Paul’s account below sheds light on a broken history of rigid work hours.

Dear Father,
I received your letter on Thursday the 14th with much pleasure. I am well, which is one comfort. My life and health are spared while others are cut off. Last Thursday one girl fell down and broke her neck, which caused instant death. She was going in or coming out of the mill and slipped down, it being very icy. The same day a man was killed by the [railroad] cars. Another had nearly all of his ribs broken. Another was nearly killed by falling down and having a bale of cotton fall on him. Last Tuesday we were paid. In all I had six dollars and sixty cents. I paid $4.68 of it for board. With the rest I got me a pair of rubbers and a pair of 50 cent shoes. Next payment I am to have a dollar a week beside my board… I think that the factory is the best place for me and if any girl wants employment, I advise them to come to Lowell.

-Excerpt from a Letter by Mary Paul, Lowell, Massachusetts “mill girl”, Age 16, December 21, 1845.

As with all the business diseases of the Industrial Age, working with ceaseless regularity and rigid hours is a very new thing in the history of man. It first got started in textile mills in the 1790s. In 1845, Mary Paul had to report at 5am, got thirty minutes each for breakfast, lunch and dinner, and got off at 7pm. She didn’t have to work Sundays. She had the good deal – the English textile mills indentured thousands of orphan children for no pay, from 1784 to 1847.

A Very New Thing
But even as late as 1850, the majority of manufacturing and other work was being done at home, not at places of business. However, when machines started to take over parts of the production, they needed people to run them and it was easier to move the people to where the machines were than to move the machines – the workplace was born.

And the machines wanted to run 24 hours a day, but weren’t very good at adapting to human biorhythms and cycles, either. So the humans adapted to the machine’s need to run 24 hours a day, and started showing up at the workplace in shifts to take turns running the machine – the rigid workday schedule with a whistle on both ends was born – a Time-Based system of work.

Results vs. Time
In the preindustrial world, the most important factor was the individual’s dedication to accomplishing the task, or a Results-Based system of work. The modern system, with it’s roots in the Industrial Age, simply rewards being in a certain place and doing minimal work until the clock runs out – Time-Based.

This all came from what Max Weber coined as “the Protestant Work Ethic” which laid a nice foundation for creating the Factory System in the 1800s, because two of its four foundational beliefs were 1) punctuality and 2) the primacy of the workplace in life.

But what the Industrialists conveniently forgot is that the Protestant work ethic also taught that by hard work the individual could be master of their own fate. When we worked for ourselves on farms, in workshops and stores, this was true. But the Factory System violated this tenet of the Protestant ethic and demanded harder work for even less freedom. In the Factory System you were no longer master of your fate no matter how productive you were. That shows up in today’s workforce.

Work Less, Accomplish More
In a 2008 survey called Wasting Time at Work, Salary.com showed that the average employee wastes more than 25% of their workday, or 2.09 hours a day, excluding lunch and scheduled breaks, doing nothing. Why? Because we set up a system that grades them on time spent in the office, not on productivity. It’s a system of mistrust based on management’s belief that employees are lazy. And this research shows they are living up to our worst expectations of them.

Management makes people lazy. Expect more of them as Stakeholders and they will raise their game or leave. The Nine to Five “car in the parking lot” mindset is the root of many of the dumbest practices in business.

Time is the New Money
The lesson here is simple – give people clear deadlines for when things should be done, with the incentive that if they can get it done without you looking over their shoulder, they can have a much more flexible work life for achieving it. If someone gets their work done by 2pm, they should go home and play with their kids. If they are Stakeholders, they will be even more productive going forward. If they are employees, they will abuse this a couple times and you will move them along to find a day care center where they can be children. And doing so will ensure that everyone gets the message they have to be self-managed adults.

The Industrial Age was an interruption in our age-old commitment to accomplishing the task in the shortest time possible, and instead promoted the idea that people are inherently lazy and need to be clocked. The faster we get back to our preindustrial Results-Based system of work, the more productive we will be as a society.

Get your work done and go home.

This is a summary of a chapter from Chuck’s new book, “Why Employees Are ALWAYS a Bad Idea (And Other Business Diseases of the Industrial Age)”. Click here to pre-order this new ground breaking book at a discount on IndieGoGo.com until July 28.

The Industrial Age is Dead – Time is the New Money

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The Industrial Age is Dead – Time is the New Money

As a business owner, you’re likely carrying a lot of baggage from the Industrial age (1800-ish to 1965-ish) that won’t fully go away for decades to come. He who makes the rules wins. You need to stop running your business on Industrial Age rules.

The Industrial Age brought us two incredibly bad ideas that led to many other bad ideas:

  1. Retirement
  2. Separation of work and play

A few weeks ago we said retirement is a bankrupt industrial age idea . Here we’re saying separation of work and play is a bad idea.

Time vs. Money
A young web designer friend of mine just one year out of college was given a huge pay raise by an ad agency, from $48,000 to $69,000. The company saw him as indispensable and didn’t want him going anywhere. A few months later, as winter approached, he quit. They wanted him there 8am-5pm and in the winter the only time to ride a bike was in the afternoon.

He would have worked in the evening, and that would have had no impact on the company, but they were stuck in the Industrial Age that valued money over time, and couldn’t see it. They were giving him the same tired “I’ll trade you money for your hours” deal that was dominant in the Industrial Age. He now runs his own very successful company and goes for a run or bike ride in the middle of the day any time he wants.

The Old (and Returning) Normal
For thousands of years people lived where they worked (over the storefront, on the farm) and played where they worked. Community was built around work and small markets. The kids ran and played, learned and worked there, the grandparents helped out – everyone was involved.

And there wasn’t much separation of work and play in the process. We look back and have a dreary and incorrect view of what life before “jobs” was like. What we miss is that above all else, we had community, something we’re only now beginning to recapture.

Humans as Extensions of Machines
It’s easy to see how this happened. During the Industrial Age, machines needed humans to become extensions of them in order to serve the machines properly. The machines needed people to be there all the time to run them, so we created humans in the image of machines. That “condition” was spread across all vocations, and “jobs” that separated work and play become the norm, even where there were no machines.

The Silent Generation – the worst label ever given
And it all worked in response to the needs of the machine, not the person. As the companies that owned the machines became huge, the pervasive need was to serve the corporation, and we were told to shut up, sit down, live invisibly, be loyal, don’t make waves and go out quietly. The generation which lived at the pinnacle of the Industrial Age, who are now in their late 70’s and early 80’s, have been labeled by marketers and sociologists as “The Silent Generation.” Can you think of a more condemning label? But it accurately reflects the damage the Industrial Age has done to us as a culture.

Time is The New Money
The Industrial Age taught us to value money above time. Giant Corporation, Inc. wanted you to focus on making money, not on having time to do anything with it. They needed all your time to run the machines. In the 21st Century we will understand that riches may equal money, but wealth equals freedom – the ability to choose what to do with my time. We will understand that money does not give us freedom, only time can do that.

Do you have time (wealth) or just money (riches)? Stop focusing on making money (see my book, Making Money Is Killing Your Business on the same subject), and intend to be wealthy instead. You’ll actually make more money and have a lot more fun in life, too.