How do startups, agencies and companies deal with the need for organisational and cultural change? Jan Pautsch, Head of Creative at Cogs shares his thoughts, personal experiences and inspiration on the subject, alongside a contribution by Eero Aalto, Head of Business Transformation at Heimat.
Self-management needs cultural foundation.
Progressive organisations of all sizes experiment with self-governing operating systems – shifting to decentralisation and dynamic self-management. Holacracy® – a system for self-management is currently used by around 70 companies arcoss the globe. Pioneers in this field like global conscious innovation consultancy Mandalah adopted Holacracy years ago, but startups like Medium, Buffer, Github or Blinkist publicly share their first experiences using the system, as well as highlighting their failures.
It seems, that there are certain traps and difficulties on the way to transcending the traditional management paradigm, as there are far too many rigid processes as well as the misconception of flat hierarchies and the loss of sight of customer-centric culture as the core of the business. Nevertheless, self-management is hitting the boardrooms of large enterprises and even corporate giants like Deutsche Telekom, as they start to adopt new ways of working within small teams. The reasons for these shifts are obvious: fear of failure, lack of speed, engagement, innovation and leadership in our current organisational norms. However, beyond the hype and even the financial considerations, there is a desire to organise a business, in a wholesome and fulfilling way.
‘Organizations can’t be designed, they need to be created, out of a new thinking, a different need and transformational insights.’ Holacracy: not safe enough to try — Julia Culen
I believe that we urgently need a new perspective in our workplace. A self-organised structure should neither be a theoretical exercise nor can it be forced. The key to embracing change is to deeply embed it within the purpose of the organisation, determined by the core-values of a humanistic culture and viewed with a fresh understanding of leadership.
Culture can’t be strategised, but it can be hacked.
A new structural foundation for self-management requires a culture that encourages and supports the individual. Culture cannot be strategised, it’s made up of organisational myths, accepted practices like norms, traditions, habits and mindsets and is infused by the spirit of the founder. Psychologist Edgar Schein describes culture as a product of joint learning:
‘A pattern of shared basic assumptions learned by a group as it solved its problems of external adaptation and internal integration (…) A product of joint learning.’ — Edgar Schein
Culture cannot be designed but can be acted on, challenged and hacked. Zappos Downtown Project is a fantastic example for how a company is externalising it´s culture and values to the next level. The Downtown Project started 5 years ago in an effort to revitalise a grungy neighbourhood of Downtown Las Vegas into a co-learning and co-working capital.
Zappos has done exactly that, by investing in passionate individual entrepreneurs. Unlike chain stores or big businesses, customers can go into the businesses they’ve invested in at almost anytime and actually interact with the owner, learn their story, their inspiration, and their passion. Zappos Tony Hsieh calls this: ‘collisions’ – serendipitous encounters between individuals who can drive innovation.
‘Our number one priority is company culture. Our whole belief is that if you get the culture right, most of the other stuff like delivering great customer service or building a long-term enduring brand will just happen naturally on its own.’ Tony Hsieh, Zappos, about the Art of Great Company Culture
Amplifying cultural change doesn’t always need to be a hundred-million-dollar investment. Single projects can serve as cultural hacks and as pilots for an agile and self-organised structure because, in these types of projects, specialists are more important than hierarchies. These projects can be initiated either by internal fence-jumpers or by bringing in external insurgents who shine a light into a corporate land.
Together with a team of dedicated collaborators, I initiated: DECODER – for Aperto, an IBM Company. DECODER is about ‘unlearning and relearning’ new methods of collaboration across technology and creative skill-sets, in highly innovative environments. It´s a generative format that stands for the deciphering of creative patterns, communications systems, and different methods of working. We decided to open our house to smart people who taught us how to decode communication patterns. Something that was far away from our daily digital communication challenges.
DECODER participants from Trainee to Managing Director are forced to work across team borders and corporate worlds and cultures to interact with one another. The whole purpose of the project was to ensure that participants are taken out of their comfort zone, far removed from their computer screens, to create a product together that‘s more than just tangible, it‘s ‘enterable.’
Smart structural changes enable an organic evolution.
I spoke to Eero Aalto, Head of Business Transformation at Heimat Berlin (part of TBWA), about the necessary cultural changes in the agency-world. Here are his thoughts:
‘Agencies tend to fill in their existing structures over and over again, and never really re-think it to truly match with their clients’ real needs. While the world keeps evolving faster than ever, agencies are still solving today’s problems with structures from the 1950’s – often with art and copy based creatives. While ‘expertise’ in these areas remains very, very important, often we embrace the ‘creative-first’ culture where strategy means back-rationalising and ‘someone else has to make it digital’. What if the best solution is not always one masterpiece of communications anymore, but rather a new business model, new service, or an on-going marketing programme?
People, and the way people are organized, drives the culture. Decades old structures cannot be challenged with processes, as the strong culture simply eats processes for breakfast. But if the structure is changed in a smart way, it will enable an organic cultural evolution.
Hence, creative agencies should to re-think the structure. Who is needed? Who is not? This will help to define the best solutions for clients’ marketing problems now and in the future. With an emphasis on defining the solution (read: the idea), not just crafting the outcomes.’
‘Decades old structures cannot be challenged with processes, as the strong culture simply eats processes for breakfast. But if the structure is changed in a smart way, it will enable an organic cultural evolution.’ — Eero Aalto
Emotional intelligence is becoming the new currency of work.
The key to a developed company culture is the level of consciousness of every single member of the team. But how do you even begin to look for emotional intelligence, for ‘character and trust’ qualities in employees/candidates and how can these qualities be measured?
Emotional Intelligence is becoming the new currency of work and is the key to embracing change in our organisations. Although it is far more difficult than physical or intellectual labour, and yet so easy to avoid. IQ and experience are no longer enough, companies are hiring people for their emotional labour and intelligence. This is the future direction for organisational development. It has never been more important for organisations to be doing and valuing emotional labour during a period a rapid evolutionary change.’ — Johnson
We at Cogs understand that we are in an age of empowerment and collaboration where individual performances become less important than the team. Understanding the candidate’s motivation and inner purpose/driver is vital for finding them the right vocation rather than the interview for a particular role. It’s important to not confuse communication skills with technical abilities and knowledge. We take time with candidates using long observation techniques and extensive testing at times. The key is to build long lasting relationships looking for the potential not just the skill sets. Qualities can be measured with challenges and presentations, and for senior candidates let them interview you. Set a defined and agreed process. The chemistry test is important, just spending time, side by side, working on a real task.
This humanistic approach towards a talent-centred-consultancy is grounded on our own values and beliefs. Cogs is a Meritocracy – where it isn’t what you say you do that is important, it’s what you actually do. Our vision/purpose is bringing true value to our clients and making a difference to their businesses and to them by finding and representing the best talent. Our core principles are: hard work, insight and effectiveness. We are self-organising, we distribute authority, we are transparent with information, leaders by example, constantly learning, investors in training, nurturers of culture and searchers for inspiration. We adopt agile working processes.
This article is inspired by an interview, Alexander Clark conducted with Jan Pautsch for his Hyper Island Master Thesis 2017: Empathic Culture & Self-Leading Teams How might we help organisations ‘shift’ to an empathic culture and a self-organising model? Jan was able to draw on his experiences from his previous role as Executive Creative Director at German agency Aperto – an IBM Company and as his current role as Head of Creative at global recruitment agency, Cogs.
A special thanks to Eero Aalto (Heimat & TBWA\Germany’s Head of Business Transformation) for his contribution. We at Cogs are very proud of our impactful collaboration with Heimat – supporting them in building the next evolution of their business by identifying, attracting and keeping the right global digital talent.
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Images: Aperto Poems – a spatial brand design project for Aperto – An IBM Company.