Excellent article about working without managers

I recommend that everyone reads this article about a company that works without managers.

Here’s what it boils down to:

• No one has a boss.
• Employees negotiate responsibilities with their peers.
• Everyone can spend the company’s money.
• Each individual is responsible for acquiring the tools needed to do his or her work.
• There are no titles and no promotions.
• Compensation decisions are peer-based.

It almost sounds like peer learning …


Thanks for sharing Dirk. The article is very interesting, but it is actually somewhat concerning, to my mind, as well. Anyway, it seems to me it is really worth reading and discussing to enhance the understanding of p2p-activity.
In particular, I have to disagree with the statement that its principles are almost the same as those of peer to peer learning (or sharing, or whatever). Well, I don’t deny that there is some similarity in terms of experience exchange and collaboration within projects. But it seems that this is the way it works in any sensible company, especially in small and medium-size businesses where there’s no need for strict control and the result is the most important priority. Same would be true for some traditional education practices where learning, though centralised around the instructor, still provides some options for distributed activity and p2p-cooperation within assignments or study-groups.
If p2p only means this, then fine, I might agree that this is almost the same.
But as I was reading I had a feeling that it is still not the same, moreover, it’s rather far from the same as, say, P2PU. That made me think what was wrong. It appears that the key thing here is ownership, in other words who gets the resulting benefits and how incomes/profits are distributed. Well, what is the resulting ‘income’ in terms of p2p education? To my mind, it is the knowledge (and skills) that comes from shared experience and materials, mutual help and cooperation. All the resources are open and available, so peers can take as much knowledge as they want and use it in a way they like.
In the case of Morning Star and any other commercial company, income (and profit) is what is normally meant by it: money that the company gets for selling its production. How is this money distributed in Morning Star? I don’t know, there’s nothing about it in the article. Is it equally distributed among all the ‘colleagues’? Or is it available for everyone as much as they need, just like in the case of p2p-learning? I seriously doubt it. Otherwise, I think, it would be claimed right away, in the very beginning, as a teaser. Yes, of course, the members can buy whatever they need for their mission and there are no explicit limitations of how much company money they can spend on it. But that’s for the company, not just for the people who are working there. It’s like as if we had a programming MOOC at P2PU, which made sure that everyone who has completed it can apply their skills only to develop the P2PU platform and can’t use them elsewhere. But it seems impossible even to arrange, let alone rather contradictory to the idea of open p2p-learning.
That said, I don’t deny that a true p2p-company project theoretically could exist. To my mind, that would mean that the key idea would be that every worker there is a shareholder and one of the owners of the business. I’m sure there are some experiments in this area, but I don’t know much about it. I only wanted to point out that there seems to be still a huge and principle difference between such projects as Morning Star and p2p-initatives as they are.
Of course I’d love to know what others think about it.

Hey @ansakoy & @dirk:

I feel weird about mixing up the idea of the collective and profit as well. I think it can be done well in a social enterprise model–I think about Arduino and Freeformers, who are not exactly “collective” but have open, do-goodery spirits as examples.

Holacracy” is a concepts that’s getting legs within the organizational behavior world. Zappos just went “boss-free” and explains the concept as:

The unusual approach is called a “holacracy.” Developed by a former software entrepreneur, the idea is to replace the traditional corporate chain of command with a series of overlapping, self-governing “circles.” In theory, this gives employees more of a voice in the way the company is run.

At its core, a holacracy aims to organize a company around the work that needs to be done instead of around the people who do it. As a result, employees do not have job titles. They are typically assigned to several roles that have explicit expectations. Rather than working on a single team, employees are usually part of multiple circles that each perform certain functions.

Full article: http://www.washingtonpost.com/blogs/on-leadership/wp/2014/01/03/zappos-gets-rid-of-all-managers/

In the end, I like the idea of people being elastic, not bound to their job titles, and in charge of their own destinies. That sounds like P2P-learning in the for-profit world. Which I can live with.

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Hey @ansakoy

I agree that P2PU and Morning Star are 2 very different things with overlapping principles. I like the general concept of a self coverning business is because I think that looking at education differently (like peer learning) have implications for business too.

Two specific points where I think that can be of interest to us:

  1. How we work at P2PU
  2. How peer learning can compliment a business model like this

ps. They do mention that “compensation decisions are peer-based”. I don’t know if this applies to the whole pool of money they make or if there are still bosses taking away the larger part of the profit?

@vanessa, thanks for providing an interesting link. I still wonder if it is another type of mere corporate rhetoric or a real working model that makes people’s work slightly better. So I’ll probably try and explore the subject in a greater detail.

I do agree that more freedom at work might make the very process much more exciting. It probably doesn’t seem so striking to me, because I’ve always worked in similar conditions, especially for the past 5 years (my ‘job-title’ is just a burocratic formality and it doesn’t cover a tenth part of what I really do). But working for a big corporation might be very different from this, so that even if these are simply an algorithm for exploiting people more kindly, it still may make sense.

@dirk, thanks for the clarification, I think I got your point. Yes, in terms of better understanding of p2p-environment potential and mechanisms this is very instructive. As well as the integration of some of the peer-learning principles into a business model. In my previous comment, I actually tried to formulate the distinctions at the background of apparent similarity, which seems to be an helpful aspect of any comparison process.

As to the peer-based compensation decisions, I agree, there’s no clear explanation of what exactly it means. I only suggested that in case there were the inexplicit bosses who get the most of the profit, it would be formulated in a more straightforward way, because in some other cases the author is very straightforward. But I don’t insist.

By the way, what seemed to me really strange is that the article was published in 2011, when the company had existed for 20 years. I wonder why this unusual model wasn’t widely discussed before.

Thanks for sharing. I enjoyed reading the article (and hope to read the Zappo’s one later today).

@dirk Would you be interested in running a conversation during the community call about this? I am wondering how well P2PU is doing with respect to giving everyone ownership, what changes we might want to make as an organization, and what that would mean for each of us individually. I can help!

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@1L2P I think it is a good conversation to have during the community call. I’m happy to introduce the topic and hear what other people’s thoughts are. If you have something more structured in mind feel free to lead the conversation.

I mainly want to know what aspects of the article we like and if we need to make changes to the way we work, in order to implement them.

I personally think the article glances over three issues that are pretty complicated: involving everyone in sustainability (if everyone has full ownership, that also means ownership of generating income), knowing who makes which decisions when everyone has authority, and the difficulty of dealing with de facto hierarchies when they are not explicit (it might make it harder to identify problems).

To add more food for discussion, here is an excellent article that argues “Hierarchy is Good. Hierarchy is Essential. And Less Isn’t Always Better”. The authors studied communities and can’t find any without hierarchies. They suggest that the real target should not be hierarchy, but bad bureaucracy. The differences are important.

Great article @dirk, thanks for sharing.

Brain melting in parts to imagine & believe it works (tho I do!).

Would be interested to see 100 other co’s try and see who fails and who doesn’t, to start to understand what lets this work.

Aspects of this remind me of working at a professional services firm, which tend to employ no professional managers either, but with v diff results (managerial (and hierarchical) responsibilities allocated to front-line practitioners, who don’t stop practising their trade, just have to do both that and management - which often leads to pretty mixed results). That also tied in with my first thought on this article, which was that the co. doesn’t support the theory that management is bad, just that bad management is bad.

I’d assume peer-driven management could go just as wrong as hierarchical management (you don’t need a monarch to get a royal screw-up), so the really interesting part is what lets this company self-manage successfully? Presumably this kind of approach susceptible to the usual problems of non-hierarchical communities, like group-think mediocrity, or containing dominant-but-inexpert personalities (squeaky whell probs), tho they’ve clearly dealt with those so far. I suspect v. clear goals & metrics must be important to this - ie process-tomatoes-to-make-a-profit, & interesting tools like P&L accounts per team.

Interesting to think how this should apply to a small NFP. Arguably a lot of this should already be working in a small NFP - smaller org usually means more shared responsibility, less prof managerial class, more exposure of all employees to the market forces, etc. So interesting to think about where they seem to be actually doing things better.

Good food for discussion.

Hmmmm, for every article I’ve read defending hierarchy, I’ve read others that show how the dynamic is changing–young people demand access to decision-makers at all levels of power, more transparency, more feedback and, like Morningstar, flexible roles.

In many ways, I think our organization is a mashup of hierarchical models and flat ones. I think it will be interesting when our organization is a bit more “headless” for a bit before a new ED. I’ve been thinking about where I can help raise money, how I’d like to see our team expand, think through how I can patch weaknesses in the organization and where I’d like to grow in the next year. It’s (really) scary, but also really empowering.

I’ve enjoyed @Carl’s “management” :slight_smile: because it’s the kind that I’ve been compatible with in the past–he urges me to think bigger, rationalize the value proposition to the organization, and take more confidence in my expertise. Which is ironic, because his “management” has made me feel “flatter.” So perhaps there’s something to be said for the mindset / approach / texture of management.

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I agree with this, it is not about hierarchy vs no hierarchy. I would say that people not only want to have access to decision makers - they want to feel that they have an influence in decisions.

A difficult part for me is figuring out where the community and board fits in. If we think of the organization as @1L2P, @bekka, @vanessa, @Erika, @Carl and me I would say it is mostly flat. Introducing the board and the community make that less clear? What do we look like from the perspective of a community member?

Isn’t there a saying that if something is not scary it is not worth persuing :slight_smile:

If you come across articles, that you find equally useful as the Morning Star case-study, please do share them.

I don’t think the article tried to “defend” hierarchy. It simply stated that there are no organizational structures (or forms of human organization) that don’t have some form of hierarchy. And that bureaucracy is the problem (not hierarchy).

Do you agree or disagree with that statement?

I am interested to see more articles about flat-structures and their impact on how organizations work. I really enjoyed reading the Morning Star case study, and found myself hoping for more detail on how they overcame the challenges that were identified.

There is a point where everyone being involved in all decisions breaks down. Key is trusting others to make decisions they are better equipped to make, being transparent about decisions that are being taken, and having a way for everyone to disagree constructively.

Two criteria (at least) can guide who should be making decisions:

  • Someone’s level of expertise in the issue
  • Someone’s stake / skin in the game / ownership

That is a great question. The board is not involved in day-to-day activities, or even in identifying project opportunities. The board is a “sounding board” for the high-level direction. When we (the team) put together different scenarios for where P2PU could be going, the board very carefully reviewed them and made a recommendation for one. We trust them to have the best long-term interest of the organization in mind.

My sense is that we need to become much more open (both transparent, but also creating opportunities for meaningful contribution) with respect to the community.

@Vanessa’s comments remind me of the slide deck we’ve discussed
previously (Teams that work well - different roles /

making the point that every team member brings diff strengths and
weaknesses to a project and trick is to ensure you have the right ones on
the team at any given point.

Many management skills aren’t necessarily hierarchical, just one part of
the skillset useful in getting a project to completion. Eg much management
is about coordination, organisation, decision-making (not necessarily
making decisions, but wrangling the necessary people/info/resources into
a place where decisions get made), etc.

Management doesn’t have to be synonymous with seniority and hierarchical
structures, but usually is because managerial functions are usually coupled
with authority. While this makes some sense given the manager generally is
the bigger picture person, it doesn’t have to be a given that

If you can find a way to decouple authority from managerial skills then you
get the best of both worlds. I think that’s where this article is really
interesting - case study on how decoupling can be achieved. Don’t think
P2PU is there yet, but def working in that direction.

Two big pieces that are missing from the P2PU puzzle are: very clear goals
for everyone to work toward (ours may never be as clear as ‘process
tomatoes into desirable products’) and very clear delegated authority
(which I think we actually have but just aren’t very clear on / willing to
act on).

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Disagree with that statement :smile:

In sociology and behavioral science fields, the theory holds that difference gives way to hierarchy. Male / female. North / south. East / West. So I’d hesitate to say hierarchy is natural, but that closing the gap on difference can erase the lines of power.

If knowledge is networked and flat on the web (even if expertise is not evenly distributed) can we re-think how power in a professional context works as well?

I often refer to this article (for better and for worse–it’s not all complimentary about how millenials would like to work. I usually point to:

  • Access. Young folks assume they’ll have access to folks at all levels.
  • New challenges and lateral movement. Moving around vs. moving “up”
  • Desire for frequent career growth & frequent feedback

In the 1970s and 1980s, young people understood the need to patiently move up the corporate pyramid. Today the working world is different: companies like GE which used to have 16 layers of management now have only 7.

The flattening of organizations mean that moving “up” is not always as possible – so leadership opportunities must open up at all levels.

As Deloitte describes it, we must build a corporate lattice, not a corporate ladder. Cathy Benko and Molly Anderson’s groundbreaking book The Corporate Lattice is a must-read.

People in their 20s would like new jobs and new assignments every 12-24 months. The research shows they won’t necessarily wait three to five years for a promotion –  so you have to create more talent mobility, special assignments, and job rotation programs.

3. Millennials Value an Open, Transparent, Inclusive Leadership Style

Millennials grew up in glass houses. They are comfortable with transparency.  They believe leadership should be the same.

When asked what they look for in their leaders, they look for openness, inclusion, and diversity.


Fig 4:  Desire for Open, Inclusive Leadership

One of the ways to do this, of course, is through social media. This is why internal blogs and wikis and various corporate social networks are so widely used by younger people, and often not by boomers. If you want to attract and retain young people, you and your top leaders must be more open and transparent.

Can you give examples of communities that do not have hierarchies? The Millenials article states that organizations are flatter than they used to be, but that they still have on average 7 layers of management. And it defines leadership as number of people who report to you (and that leadership is something that Millenials want). That all sounds like hierarchy.

I am not sure what it means to erase the lines of power. And what you mean by power. Is power the ability to make decisions, or the weight of responsibility - or is it telling other people what to do without involving them in the process? For me the last one has nothing to do with hierarchy, but with bad bureaucracy. The real issue might be the abuse of hierarchy rather than hierarchy itself.

For me hierarchy is just an expression of responsibility and accountability. I am comfortable with other people making decisions if they have more expertise than me, make decisions in a transparent, inclusive and accountable way, and give consideration to the broad implications of their decisions.

What if we redefine hierarchy as a tactic that makes it easier for communities to do the things they want to do?

I should add that I am both really enjoying the conversation and am thinking about communities that are active participants in the global economy. There may be communities that have very different types of hierarchies and structures (but they probably also don’t know the term “Millenials”).

The organizational structure at Valve might be an interesting “case study” in relation to this discussion: http://www.businessweek.com/articles/2012-04-27/why-there-are-no-bosses-at-valve

I agree that Valve is an interesting case. Highly recommend their handbook for new employees: http://www.valvesoftware.com/company/Valve_Handbook_LowRes.pdf

@1L2P like you, if someone earns my respect and trust, I’ll probably think of them as a leader. But not because of hierarchy or power that’s automatic or a given–but the sort of graceful, organic esteem that I think you also refer to.

I’m really conflicted about the workplace and power and “leadership.” I’d never clock management as direct reports–I don’t ever think I could conceive of having direct reports. Like @Carl mentioned, many of the skills I possess (collaboration, outreach etc) are somewhat invisible and soft and rarely yield hard “KPI” results. I don’t think of myself as a leader.

I’d also point to two points vis-a-vis how we think about hierarchy:

  1. Our assessment principles: recognize many paths to the answer, and
    many answers. Identifying a “right” answer, I believe is
    hierarchical, and leads to competition for the status of “right”
    answer. Many answers encourages collaboration and networked
  2. Does this community have “hierarchy”?