Disappearing Managers, YAPC::EU 2014, Bulgaria, Keynote
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A curious mixture of the Internet and Agile development has led to more and more companies eliminating middle management. Some have eliminated management altogether. This talk explores this trend, discusses how modern corporations resemble feudal societies and why they're less likely to innovate. We then survey many "managerless" companies that have arisen today, but also cover many highly successful, large, managerless companies who have been with us for decades, including some whose products you probably have in your home.
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Disappearing Managers, YAPC::EU 2014, Bulgaria, Keynote
- 1. You’re Killing Managers Keep it up. YAPC::EU Keynote, Bulgaria, 2014 Curtis "Ovid" Poe http://allaroundtheworld.fr/ August 26, 2014 Copyright 2014, All Around The World
- 2. Why Aren’t I Talking About Perl? August 26, 2014 Copyright 2014, All Around The World
- 3. My Goal is to Inspire You August 26, 2014 Copyright 2014, All Around The World
- 4. Agile is Spreading “The Best Kept Management Secret On The Planet: Agile” Forbes, April 2012 http://www.forbes.com/sites/stevedenning/2012/04/09/the-best-kept-management-secret-on-the-planet-agile/ August 26, 2014 Copyright 2014, All Around The World
- 5. It’s called a “bubble” Photo by Hartwig HKD — https://www.flickr.com/photos/h-k-d/2595755975/in/photostream/ August 26, 2014 Copyright 2014, All Around The World
- 6. The “New” Tech Industry … • Needs to move fast • Needs to adjust to its environment • Iconoclastic by necessity • Old-school versus new-school August 26, 2014 Copyright 2014, All Around The World
- 7. The Elephant in the Agile Room • Why do self-directed teams need managers? • The “unsolved problem” in Agile • Traditional management doesn’t work • So … history http://www.flickr.com/photos/hbarrison/7522705738/ August 26, 2014 Copyright 2014, All Around The World
- 8. Hunter-Gatherers • Follow the leader • … or die • Not much hierarchy A Kali'na hunter with a woman gatherer. http://commons.wikimedia.org/wiki/File:Kalina_hunter_gatherer.jpg August 26, 2014 Copyright 2014, All Around The World
- 9. The Feudal Era August 26, 2014 Copyright 2014, All Around The World
- 10. The Corporate Era August 26, 2014 Copyright 2014, All Around The World Bill Gates, Berlin, 2013 http://www.dts-nachrichtenagentur. de/kostenlose_bilder.php
- 11. Startup August 26, 2014 Copyright 2014, All Around The World
- 12. Growth August 26, 2014 Copyright 2014, All Around The World
- 13. Mature August 26, 2014 Copyright 2014, All Around The World
- 14. Feudalism 2.0 August 26, 2014 Copyright 2014, All Around The World
- 15. Progressive August 26, 2014 Copyright 2014, All Around The World
- 16. Feudal Inefficiencies • Local allegiances • Poor internal communication • No price signals • No internal markets • Command-and-control from king to serf August 26, 2014 Copyright 2014, All Around The World
- 17. Corporate Inefficiencies • Local allegiances • Poor internal communication • No price signals • No internal markets • Command-and-control from CEO to serf August 26, 2014 Copyright 2014, All Around The World
- 18. Why Do Corporations Struggle? • Why don't big companies innovate more? (Forbes) • Why big companies can't innovate. (Harvard Business Review) • Why is innovation so hard for large companies? (Game Changer) • Why small companies have the innovation advantage. (entrepreneur.com) August 26, 2014 Copyright 2014, All Around The World
- 19. The Dark Side of Analyst Coverage: The Case of Innovation. (Journal of Financial Economics) Used under “Fair Use” copyright exception http://villains.wikia.com/wiki/Darth_Vader?file=Lord_Darth_Vader.jpg August 26, 2014 Copyright 2014, All Around The World
- 20. Public Companies • Share prices tied to compensation • Share prices tied to job security • Share prices vis-à-vis company takeover • Share prices as a measure of success August 26, 2014 Copyright 2014, All Around The World
- 21. Share Prices Keeping share prices high requires minimizing risk Jashuah - Own work by uploader, data from Stooq - http://en.wikipedia.org/wiki/DAX#mediaviewer/File:DAX.png August 26, 2014 Copyright 2014, All Around The World
- 22. Share Prices Minimizing risk = Minimizing innovation August 26, 2014 Copyright 2014, All Around The World
- 23. If we are willing to die for Democracy and Capitalism … why don’t we allow it in our corporations? By Dan Smith (Own work) CC-BY-SA-2.0 http://creativecommons.org/licenses/by-sa/2.0 via Wikimedia Commons August 26, 2014 Copyright 2014, All Around The World
- 24. Why Bother? • Little personal incentive • Risk averse/hide-and-seek • Blame avoidance • Groupthink Dilbert image, created by Scott Adams, used under “Fair use” copyright exception http://en.wikipedia.org/wiki/Dilbert#mediaviewer/File:Dilbert-20050910.png August 26, 2014 Copyright 2014, All Around The World
- 25. Why Do Feudal Corporations Exist? August 26, 2014 Copyright 2014, All Around The World
- 26. Why Do Feudal Corporations Exist? • Brand recognition • Mature products • Financial reserves August 26, 2014 Copyright 2014, All Around The World 1924 IBM Logo
- 27. How Do Large Corporations Cope? • BBC Blue Room • Funding startups • Litigation (“Hello, RIAA”) August 26, 2014 Copyright 2014, All Around The World
- 28. “Managerless” Companies August 26, 2014 Copyright 2014, All Around The World
- 29. Basecamp (formerly 37signals) • Basecamp, Highrise, Campfire, Rails • 35 to 40 employees • Self-organizing teams • Reluctantly trying “middle manager” role August 26, 2014 Copyright 2014, All Around The World
- 30. Github • Github! • 200+ employees • Self-organizing teams • Reluctantly trying “middle manager” role August 26, 2014 Copyright 2014, All Around The World
- 31. VALVE • 250+ people • Better profits/employee than Google or Apple • The platonic ideal of Agile? • What are corporations for? http://blogs.valvesoftware.com/economics/why-valve-or-what-do-we-need-corporations-for-and-how-does-valves-management-structure-fit- into-todays-corporate-world/ August 26, 2014 Copyright 2014, All Around The World
- 32. VALVE • Half-Life series • Counter-Strike series • Team Fortress series • Portal series • Left 4 Dead series • Steam August 26, 2014 Copyright 2014, All Around The World
- 33. VALVE • Entirely self-funded • Own their intellectual property • “Hiring well is the most important thing in the universe. Nothing else comes close.” August 26, 2014 Copyright 2014, All Around The World
- 34. VALVE • No managers • None • Really Not really August 26, 2014 Copyright 2014, All Around The World
- 35. VALVE • No job titles* • Everybody is an expert • 100% Time • All desks have wheels • Evaluation by your peers August 26, 2014 Copyright 2014, All Around The World
- 36. New Employee Handbook VALVE http://www.valvesoftware.com/company/Valve_Handbook_LowRes.pdf August 26, 2014 Copyright 2014, All Around The World
- 37. High-tech is the Catalyst ← Not that one August 26, 2014 Copyright 2014, All Around The World
- 38. Ricardo Semler • Over 3,000 employees! • 24%-27% annual growth for 25 years • All employees share profits • Many employees choose their salaries • Employees vote for managers • "Leading by Omission" speech (Google it) August 26, 2014 Copyright 2014, All Around The World
- 39. Semco’s Three Values • Democracy • Profit-sharing • Transparency August 26, 2014 Copyright 2014, All Around The World
- 40. Other Managerless* Comapanies • Morning Star Foods • W. L. Gore & Associates • Zappos.com • Medium.com • … and many more August 26, 2014 Copyright 2014, All Around The World
- 41. Agile — Products Over Process • Managers process • Workers produce • → Workers over managers August 26, 2014 Copyright 2014, All Around The World
- 42. Managerless companies • Usually Agile/Lean • Usually tech companies • Usually privately funded August 26, 2014 Copyright 2014, All Around The World
- 43. Known Unknowns • Can managerless succeed long-term? • What social changes might this entail? • Where are managers required? • Best practices? • Holacracy? August 26, 2014 Copyright 2014, All Around The World
- 44. We • We’re the ones doing this • We’re changing how business is being done • And we’re making things more fair August 26, 2014 Copyright 2014, All Around The World
- 45. Summary • Corporations == Feudalism 2.0 • Agile reduces need for middle management • We don’t know what the future holds August 26, 2014 Copyright 2014, All Around The World
- 46. Thank You August 26, 2014 Copyright 2014, All Around The World
Editor's Notes
- If you’ve ever wondered what happens in a corporate training session, this is it.
- This bubble keeps them out, and us in.
- Anyone who thinks that Amazon is so successful because they slapped a Web interface on a bookstore is missing the point.
- (Oversimplified history)
- Tend to be more egalitarian Tend to be more communal Picture: Kali’na hunter-gatherers in South America
- If you were in this structure, you didn’t think to question it because it’s what you knew.
- If you were in this structure, you don’t think to question it because it’s what you know. Ricardo Semler’s description of a textile corporation
- You can leave the company. Room for advancement. Incentives and motivations are different.
- You can leave the company. Room for advancement. Incentives and motivations are different.
- You can leave the company. Room for advancement. Incentives and motivations are different.
- You can leave the company. Room for advancement. Incentives and motivations are different.
- I tiny team dedicated to innovation, while the rest of the company remains static
- They didn’t see themselves as inefficient because it was all they knew.
- Dark side of analyst coverage: study demonstrating the more financial analysts cover your company, the less innovative you are
- Dark side of analyst coverage: study demonstrating the more financial analysts cover your company, the less innovative you are
- Obviously, private companies have more freedom (ValvE)
- Innovation is a long term strategy but minimizing risk is a short term strategy When Amazon first turned a profit, Jeff Bezos said it was an accident — they hadn’t meant to turn a profit yet
- Large companies often do large projects which means that blame avoidance is a critical strategy to keep your job (tied to ignoring sunk costs) http://www.ft.com/cms/s/0/863409bc-5fca-11e0-a718-00144feab49a.html Hide-and-seek is easier when the management graph is complex
- Part of this is because “internet speed” is relatively new.
- Nobody gets fired for buying IBM 1924 IBM logo, the company formerly named The Computing Tabulating Recording Company
- Some corps fund start-up "incubators" to tap into startup innovations If you can’t stop your competitors, crush them.
- Much
- Much of this is unsubstantiated research
- Recently celebrated 10 years of not taking a single decision as owner.
- Democracy can work better for a company than a country because the problem space is smaller.