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Would You Want To Work For These Organizations?

Would You Want To Work For These Organizations?

It’s rare that I get really excited about an article in Harvard Business Review. But this month, I’m talking to everybody I know about an article in the April 2014 issue of the magazine. Robert Kegan and Lisa Lahey, along with two other colleagues, wrote “Making Business Personal,” and I just happen to think that it’s one of the best, most cogent arguments for the work that I do that I’ve ever read.

The authors begin their article with a bold and provocative statement:

“To an extent that we ourselves are only beginning to appreciate, most people at work, even in high-performing organizations, divert considerable energy every day to a second job that no one has hired them to do: preserving their reputations, putting their best selves forward, and hiding their inadequacies from others and themselves. We believe this is the single biggest cause of wasted resources in nearly every company today.”

Think about this for a moment. “The single biggest cause of wasted resources in nearly every company today.” That’s no small statement. The authors are making the case that lost time and money stem not primarily from duplication or bad management or unforeseen external circumstances, but from people hiding what they don’t know, don’t understand, don’t agree with, and can’t (or didn’t) do.

In other words, people inside organizations are typically driven by questions like these: What do I need to do in order to look my best? How can I shine the most positive light on this less-than-ideal situation? What can I say that doesn’t challenge my boss or the status quo?

Kegan and his colleagues want to know what happens when people are driven by different questions. Questions like: What am I doing that contributed to this problem? How do I take this mistake/setback and learn from it? What can I say that furthers our collective understanding of this issue? And they want to know what happens when organizations expect their employees to pay attention to those questions. What’s the impact on business results, and on employee engagement, when the organizations we work for operate in ways that expect us to question everything (including ourselves), acknowledge what we don’t do well, and work to get better at those things?

In other words…what happens when organizations are committed to “developing every one of their people by weaving personal growth into daily work?”

Over the past three years Kegan and his colleagues have been looking for companies with such an approach, which they call “deliberately developmental organizations” (DDO’s). Over those three years they have found only about 20 worldwide. “Making Business Personal” describes the in-depth research they did with two of those companies: Bridgewater Associates, an East Coast investment firm, and Decurion Corporation, a California-based company with various subsidiaries, including a real estate firm and a movie theater operator, that describes its mission as “providing places for people to flourish.”

Both of these organizations have long track records of success on conventional measures of business performance, which are detailed in the article. Both also have remarkable cultures, supported and expressed by specific principles and practices that are laser-focused on the personal development of each and every employee, regardless of rank or position.

I’ll share here just a few of the principles and practices at these DDO’s that really caught my attention. For the full picture, I encourage you to read the article itself. (You’ll have to register at the HBR Web site, but then will have access to the entire article free of charge.)

  • Transparency. This is one of the guiding principles at Bridgewater Associates, and it’s clearly not just a poster on the wall. The commitment to transparency permeates the organization. All performance reviews are public, for all employees from senior leaders on down. Every meeting is recorded, and recordings are made available to everyone in the organization.
  • “Constructive destabilization.” Both companies purposefully stretch their employees in every position, with the goal of supporting their constant development. According to the HBR article, their view of a “good fit” between employee and job “means being regularly, though manageably, in over your head…At both companies, if it’s clear that you can perform all your responsibilities at a high level, you are no longer in the right job. If you want to stay in that job, having finally mastered it, you’ll be seen as someone who prefers to coast.”
  • Issues log. In an effort to support employees in viewing mistakes, errors, and problems as growth opportunities, Bridgewater keeps an “issues log.” This is a company-wide practice in which people are expected to record what’s not working as well as their own contribution to those breakdowns. Doing so is rewarded, while “not recording a mistake is viewed as a serious breach of duty.”

Granted, in any organization, on any issue, there will be multiple viewpoints. This is certainly true when it comes to Bridgewater. (I had a harder time finding criticism of Decurion in an online search.) According to an article in Institutional Investor’s Alpha magazine, “about 30% of Bridgewater’s employees quit or are fired” during their first two years, compared to a rough industry average of 10%. Based on the anonymous quotes from former employees in this same article, at least some of that turnover has to do with the culture. Criticism ranges from calling the organization a “cult” to a more mildly stated “it looks better on paper than when you observe it in practice.”

So, there are many questions left to research. What really is the relationship between an organizational emphasis on the personal growth of employees and the bottom line? Are there some ways to encourage employees in their own development that are more successful than others? What distinguishes honest feedback that supports growth and higher performance from painful criticism that contributes to high employee turnover?

In the end, though, I am excited by “Making Business Personal” because it confirms my own experience working with leaders and teams. Over and over again, I have seen how the ability of team members to honestly describe what’s not working and skillfully give and receive difficult feedback leads not only to higher levels of trust and engagement but also to better business results: higher quality decisions, more creative problem solving, and less time wasted in end runs around each other.

Kegan and his colleagues suggest the same thing. They are not calling for organizations to foster personal growth in employees for its own sake. They argue that developing a resilient organization capable of delivering excellent performance in uncertain and constantly changing circumstances goes hand in glove with fostering personal growth in employees. One leads to the other; they are inextricably entwined.

As the authors say, the organizations they studied “offer a form of proof that the quest for business excellence and the search for personal realization need not be mutually exclusive – and can, in fact, be essential to each other.” Decurion echoes this sentiment on its Web site: “We have come to see that profitability and human development are part of a single whole. Pursuing both emerges as one set of activities. In other words, they are not two things to be traded off or two parts of a ‘double bottom line.’”

Now that’s an organization I’d want to work for.

What about you? What questions does this provoke for you? What’s been your experience with deliberately developmental organizations or teams? I’d love to hear your thoughts!

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