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Wavelength100: Human Organizations for Human Beings

By Polly LaBarre While it’s fair to say that most of the world has woken up to the gravity of the contraction of our natural and financial resources, it’s all-too-often the exception when one of our leaders stands up against the …

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By Polly LaBarre

While it’s fair to say that most of the world has woken up to the gravity of the contraction of our natural and financial resources, it’s all-too-often the exception when one of our leaders stands up against the squandering of a third class of resources—the human kind. Which is why it was so refreshing to listen to the stories of the Wavelength leaders, so many of whom offered up a powerful point of view and clever designs for unleashing and maximizing the innate imagination, energy, and passion of their people.

This should be old news by now. We’ve all scoured the “best places to work” lists year after year, read the business bestsellers, and poured over the case studies of worldclass cultures. We all get the iron-clad connection between our design for work and our designs on the marketplace. Yet, it’s still a thrill to hear about organizations that are as fully human as the human beings that populate them—from leaders who are not just intent on driving performance but driven to inspire people.

Why? I suspect it’s because so many of us have done time inside the kind of organization (from kindergarten to Fortune 500 companies) designed to dull and dampen the gifts the world needs most: our wildest imagination, eclectic passions, tingly intuition, and organic adaptability. There’s no denying those industrial-era institutions are responsible for enormous progress, it’s just that they tend to stand in the way of the kind of progress we urgently need to make right now.

The kind of progress Emma Harrison has been making for the last 20 years with A4E: supporting people society has long declared devoid of potential. Now 3,000 people in 10 countries around the world, A4E’s innovative training and development programs for the bankrupt, homeless, and imprisoned are all based on a radically simple and ferociously steadfast point of view: “We do anything to improve the lives of people but nothing that won’t.”

Emma’s clarity when it comes to that powerful sense of purpose is striking: if “improving people’s lives” means investing tens of thousands of dollars and moving heaven and earth to unearth a pathway to a career in rope-access work for a chronically unemployed woman whose deepest passion is climbing, then that’s the job that day. Even more important, that clarity runs deep in the organization. “We have to do anything it takes to help that person move forward in her life,” says Emma. “And my staff have to be free to do it. Before you say no to a reasonable request, one of our clients might make of us, you have to ring me. And of course I never get any phone calls, because that’s the message: you have to find a way to say yes. If people are busy all day thinking of reasons to say no, then I’m spending money on people finding ways to say no. I want to spend money on people finding ways to say yes.”

That’s a powerfully straightforward approach that applies to any leader seeking to engage her people and create a genuine emotional bond with customers.

The other potent takeaway from Wavelength leaders when it comes to cultivating both humanity and high performance: freedom is a bigger game than power. The more you free people from top-down control and bureaucratic barriers, the more of that person shows up to work every day. But that doesn’t mean chaos rules. Again and again, the leaders I interviewed—from Mads Kamp of Oticon to Allison Ball of FRC — spoke of replacing rules with values. When everybody knows what the organization stands for, what it will never sacrifice for expediency or prevailing winds, decision-making at all levels tends to line up and people’s productive and imaginative energy tends to show up.

Nowhere was that lesson on more striking display than in the story of Middelfart Sparekasse, a 150-year-old savings bank located on an island in Jutland, Denmark. Eighteen years ago, the bank’s managing director Hans Erik Bronserud couldn’t shake a nagging question: “Is there another way to manage a company like ours?” The bank was small but successful, and yet, Bronserud said, “I’d seen people come to work every day and thought, ‘You must have so much more inside you.’ I wanted to see people grow.”

With that conviction in mind, Bronserud staged a kind of coup in his own company. In February 1991, he called the entire staff to a meeting to talk about the business. At one point, he turned off the lights and stopped talking for several minutes (which, in Denmark in February, makes for a very dramatic moment). When he turned the lights back on, it was to introduce a completely new design for work to his colleagues.

“We stopped every form of control,” he says. No longer would employees have to apply to bosses for vacation days, punch in at a certain time, or even consult with a manager when adjusting fees or considering an unorthodox application from a customer. As Bronserud puts it, “If you get the wrong leg out of bed in the morning, it’s better to take a long walk along the sea shore rather than boring your colleagues or your customer.” In short, the bank’s people were given complee freedom (and the responsibility) to manage their own work, their own career path, and their interactions with customers.

The reaction across the board was “you’re crazy,” says Bronserud. “Banking is too serious to work this way. They thought we would run the bank over the edge.” In fact, the opposite has happened. Middelfart Sparekasse has grown from 38 people and one branch in 1991 to 170 people in 8 branches around the country. The bank has expanded into the real estate business (30 people and 6 branches), the insurance business (35 people), and a collection of small business (most launched by employees with the support of the company). It’s reputation for employee engagement, customer service, and community involvement is unparalleled (and relentlessly tracked and improved upon via an annual “Social Ethical Accounting” statement which delves into every aspect of the bank’s performance against the expectations of a range of stakeholders). Meanwhile, in the midst of the financial sector’s epic meltdown, Middelfart has avoided any liquidity issues or bad loans. The business is thriving, says Bronserud “because when our people see unethical or unsustainable business practices, they avoid them. So we haven’t had the problems that many of our colleagues in banking have had.”

What’s behind the breakout performance of this once-sleepy savings bank in the middle of Denmark? Bronserud argues it’s Middelfart’s “100% values-managed” culture. Bronserud replaced the bank’s extensive rules and controls with a simple set of values, which he determined ought to be short, in Danish, and memorable. They translate roughly into a simple but powerful formula for success: treat customers in a way that inspires them to come back and talk about the bank positively. Treat employees in a way that they look forward to coming to work every day and are proud to say where they work. Earn enough money to keep the first two promises. Beyond that, “individuals make all the decisions and once made, nobody can change them.”

The transition to the new mode of working wasn’t entirely smooth. Bronserud encountered serious resistance from leaders (“When all our employees are self-managed, what’s the job of the boss?”) and regulators. “They come every 3 years and we tell them we don’t have any rules here,” says Bronserud. “We have a manual somewhere in a cupboard if they want to see it. They don’t like that very much. But the last audit, they finished 2 days early. Everything was in order because the employees are responsible. That’s what happens when you don’t have anybody looking over your shoulder.”

The employees were another story. After offering a series of tests and audits to employees, Bronserud says, “we found our employees had so much inside them. We asked, ‘Why don’t you use that at work?’ And they said, ‘Nobody ever asked me.’” The journey since that initial discovery has been one dedicated to unearthing and leveraging the passions, talents, and insights of every single person inside the organization. Middelfart offers extensive training in self-management (from transforming bosses into coaches to NLP courses for all) and continuous opportunities to stretch. “When I see a person with certain skills, I encourage them to start a business for themselves,” says Bronserud. Most important, the bank gets out of its own way to offer each person room to grow. Bronserud’s advice is simple and striking: “You have to remove rules because you’re killing your employees—and you’re killing the business.”

Read Polly’s other blogs from Wavelength100:

Wavelength100: We Should Be Angry
Wavelength100: The Power of the Poor and the Purpose of Profit
Wavelength100: Higher Aims: From Poverty of Ambition to Audacity of Imagination

 

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