By Jennifer Briggs
When companies begin pondering the journey toward employee ownership there are many options and opportunities to start shifting to the new work world. For companies selling to an employee stock ownership plan (ESOP), one obvious and essential activity is to teach employees about their new retirement benefit. But, a quick next step is to figure out how to instill more ownership thinking.
Years ago I had the pleasure to host an amazing company from Cape Town, South Africa. They were visiting New Belgium Brewing Company to gather ideas on how to connect their employees to the idea of employee ownership. We spent the day exchanging practices and incubating ideas. One very practical and simple example was starting the process of moving from rigid rules to a more values-based and responsibility-oriented environment - starting with dress code. The concept was simple - if we can't own ourselves and how we show up at work how can we fathom the responsibly of owning shares? I share this example with you because it demonstrates how starting points for each company will be different. What's important is to define it, make your map and to get started.
A few thought starters on framing up new or more intense responsibilities in an employee-owned culture:
- Leadership attitude. How open is the top leadership team to distributing power, authority, and responsibility throughout the company? This will likely evolve over time with more practice in an employee-owned culture, but it is important to determine your starting point and your leadership team's attitude toward that starting point. One team, one dream. Shared profit motive. All great rallying calls, but putting the leadership mindset and practices in place that will demonstrate the shift is important. "Authority without responsibility is tyranny, and responsibility without authority is impotence." ~ Peter Drucker
- Organizational health. Patrick Lencioni goes in to depth on this concept. The short version - by having trusting, committed teams the performance follows. When healthy teams work together they are focused on the best outcomes for the company. Healthy teams + organizational commitment = better results.
- Recruiting. How will you change your recruiting and interviewing process to find great talent that is ready to work in a more open, responsibility-oriented company? Are you introducing your company culture to your applicants so they understand how working for you is different from what they might be accustomed? Are you using behavioral interviewing techniques focused on identifying the mindset that you need to support the environment you are building? Skill vs. mindset? I pick mindset first and then develop the skills.
- Business and financial literacy. These are two interrelated concepts. I see business literacy as understating the marketplace and how to use it to make money. Think Porter's five forces and other marketplace economic concepts. Our world is changing fast and understanding marketplace dynamics and better yet, getting ahead of it, is critical. Teach people about the business you are in and then use their intelligence for continual improvement. Financial literacy is understanding how the company operates. For every $1 of revenue, how is it spent and reinvested? What is the profit? How are financial investments determined? What are your short-term goals and vision for the long-term horizon? What are the financial mechanics of it all? Then, most importantly, how can you involve employees to better forecast the financials and refine their priorities to improve their impacts on the business? Teach both - financial and business literacy. Start with basic terminology and your financial statements. Share your consumer insights and marketplace demand reports. Grow from there. There are risks and rewards when you own stock. Share the risks and celebrate the rewards.
- Owning one's performance. This is a manager's dream. A company that has a powerful, unified collective consciousness and individual accountability to one's own performance. Aligned goal setting, new approaches to performance coaching, and unified norms help form a collective accountably minimizing the need for organizational policing and wasteful bureaucracy. This might mean changing your performance management system including goal setting and performance reviews. When you can get an adaptive, disciplined system of everyone rowing in the same direction, you are getting the full support of your human system behind your business goals.
- Taking advantage of tension and conflict. As you open books and open minds it is likely that there will be more tension and conflict. Tension does not need to be associated with negative thought. You can teach people how to have inquiry and debate as a means to improving the quality of decision making. Debate and decision making is a process and skill that can be taught and a wise use of energy and effort. Tension helps build muscle and the right amount developed with skill can make your company more fit.
- Levity. Read "The Levity Effect." The author, Scott Christopher, joined New Belgium for one of our retreats to remind us that it does pay off to lighten up. This is serious stuff and we can all benefit by being a little more light-hearted.
Many employee activities can spin from these general concepts. For example, if you have a self-funded health plan, how can you teach people about using consumer-driven health care to make your plan more effective and mitigate future increases? How can you assign financial line items to specific owners and have them report progress, concerns, and forecasts about their line? How can you use involved project teams to make the project more effective using the revenue/profit connection? How can you use the collective intelligence to identify potential opportunities with your consumers? How can you take hints from participative agile techniques to improve project outcomes? What unique ways can you celebrate accomplishments and build employee trust and commitment?
Most leaders see the idea of employee ownership culture as one of responsibility and intrapreneurship. To allow responsibility to flourish, you have to create an environment that nourishes it. Leaders may need to be more directive and specific in the beginning of the journey to teach the different ways of working. That attention will create the emotional connection, community commitment, and passionate drive that will strengthen the shared profit motive.
Jennifer Briggs, organizational development and HR executive consultant