⭐ Toby's Rating: 10/10 - Recommended For: Managers in "Traditional" Organisations
3 Big Ideas from Humanocracy 💡
Humanocracy by Michele Zanini, Gary Hamel will help transform your organisation:
Dismantling bureaucracy means dismantling traditional power structures.
The genius in organisations does not reside in management. It comes from the teams doing the work. Many traditional organisations fail to tap into the potential of their teams.
The distance between the employee and customer determines its success. The best organisations close the gap. Bringing employees into direct contact with real customers. Directly feeling the market forces at play.
2 Best Quotes from Humanocracy Summary by Michele Zanini, Gary Hamel 💬
When “ordinary” employees are given the chance to learn, grow, and contribute, they’ll achieve extraordinary results.
A leader's job is to facilitate, not force.
Humanocracy Summary Takeaway ✅
Humanocracy will hit you hard.
I believe in many of the ideals. Yet it still makes you stop and think.
"Traditional" Organisations hoping to transform have a serious challenge ahead.
As you will learn from this Humanocracy summary, there are big obstacles to overcome.
Three examples:
Shifting from a culture where managers are the experts, workers the executors. To a culture where everyone, regardless of rank can contribute fully to the business outcomes.
Moving employees to have closer proximity to real customers. To feel the market dynamics directly.
Recognising competence not confidence as the primary driver for success.
Essential reading for any leaders driving workplace change. I hope this book reaches the leaders that need it most.
Big Ideas Expanded 💡
Humanocracy Principles
Empower Ordinary People To Create Extraordinary Results
When “ordinary” employees are given the chance to learn, grow, and contribute, they’ll achieve extraordinary results.
Gallup’s 2019 Great Jobs Demonstration survey, barely a third of US employees strongly agreed with the statement: “I have the opportunity to do what I do best every day.” Less than a quarter said they were expected to be innovative in their job and only one in five felt their opinions mattered at work.
What percentage of your organization would agree with these statements?
My work is my passion
I get to make meaningful business decisions
I feel directly accountable to customers
I intuitively think lean
My team is small and super-flexible
The success of this business depends critically on me
I measure progress in days and weeks, not months and quarters
Every day I have the chance to solve new, interesting problems
I have a significant financial stake in the success of this business
Most of today’s corporations were conceived as command-and-control organizations. The founders of integrated steel mills, for example, clearly assumed that the “genius” of the organization resided almost completely in management.
Few established companies offer recruits what they crave most: autonomy and financial upside.
In contrast, the best businesses operate under the assumption that most of the “genius” is found among the people doing the work.
The best businesses focus on:
Turning every employee into an entrepreneur
Creating “zero distance” between employees and users
Making the company a power node in an ever-expanding, web-centric ecosystem
Don't Copy Paste Change
Drawing lessons from these and other vanguard companies is a bit like trying to learn from Tiger Woods. The challenge is less to mimic the mechanics of his golf swing, which are uniquely suited to his physique and are constantly evolving than to learn something about the reserves of stamina and determination that helped him win fifteen major golf tournaments.
Being a pioneer isn’t easy. There’s no trail map. The only thing that can guide you is your worldview about people, organizations, and success.
What works in one organization may not work in another. Additionally, each process is part of a larger whole. Bolting a single, vanguard process onto a conventional management model is usually a fruitless exercise—like donning Cristiano Ronaldo’s number 7 jersey in hopes of becoming a soccer legend.
Stop Managing Start Leading
A leader's job is to facilitate, not force.
The goal is to maximize contribution, not compliance.
High impact behaviours include:
EMPOWERMENT: Increasing the decision-making autonomy of one’s subordinates
ACCOUNTABILITY: Holding individuals accountable for the consequences of their decisions
SELFLESSNESS: Giving priority to the needs of others
HUMILITY: Openly acknowledging one’s limitations and mistakes
AUTHENTICITY: Relating honestly and openly with others
COURAGE: Challenging institutional norms in the interest of supporting others
FORGIVENESS: Demonstrating empathy and a willingness to forgive
STEWARDSHIP: Taking responsibility for the success and integrity of the institution as a whole
Empowerment is the most highly correlated with employee engagement, job satisfaction, and organizational commitment, while accountability was the strongest factor impacting job performance.
Behaviours that degrade performance:
DEFEND WHAT’S YOURS. Leaders tend to be territorial about the resources they control and are typically reluctant to share money and talent with other units, even when the returns might be higher.
THE RICH GET RICHER. The biggest units in a multibusiness company tend to get more than their fair share of capital, not because they offer better returns, but because the leaders of these businesses have more political clout.
GOOD MONEY AFTER BAD. Executives tend to overinvest in struggling businesses in hopes of turning them around. Research shows that in most cases, returns would have been higher if the money had been invested in less troubled units.
SHARE THE PAIN. When cash is short, executives tend to cut spending across the board rather than protect high-priority areas.
IT’S WHO YOU KNOW. Senior leaders with strong internal networks typically win more resources than leaders who are less well connected, irrespective of the merits of the particular business case.
HOME IS WHERE THE HEART IS. Senior executives are less likely to defund or divest a business in which they worked earlier in their career.
PRETTY IT UP. In competing for funds, business unit leaders have an incentive to inflate the merits of their investment proposals. These distortions are often difficult for corporate-level executives to ferret out.
MORE OF THE SAME. Funding decisions are often made relative to last year’s budget. Every business or product line gets pretty much what it got the year before, plus or minus a few percentage points.
In a survey with the Harvard Business Review, 76 percent of big-company respondents said that political behaviors highly influence who gets ahead in their organization.
In another survey, 84 percent of middle managers and 97 percent of executives claimed to be among the top 10 percent of performers in their organization.
So common is the habit of overrating one’s abilities that it has a name: the better-than-average effect. One oft-cited meta study found that the correlation between self-assessed and actual performance was just 0.29 and, in the case of managerial performance, a paltry 0.04.
Focus on Competence Not Confidence
First, highly confident people tend to have an advantage in competing for power. Research shows that in judging the competence of others, we’re heavily influenced by bluster. The more confident someone appears, the more likely we are to believe they’re genuinely capable, whether or not that’s true.
The implication: it’s often the most confident people, not the most competent, who get to the top.
Research shows our assessments usually say more about us than those we’re evaluating. Again, this phenomenon has its own name—idiosyncratic rater bias.
As woke adults, we’re more conscious of our biases, but it’s still hard to disentangle the question of “who’s competent?” from the question of “who makes me feel comfortable?”
There’s little evidence that wisdom correlates with rank. Indeed, a growing body of research suggests the opposite—that positional power increases the odds of bone-headed decisions.
Commitment is voluntary. No one has the power to give an order. If you want people to follow you, you have to give them a reason for doing so.
Customer Proximity
In a startup, everyone reports to the customer. Most employees have a financial stake in the business and understand the only way to create value is to do amazing things for customers. In large organizations, by contrast, employees are often insulated from market forces.
The paradox is that in some ways, large companies are well equipped to be entrepreneurial hot spots. They have deep pockets, thousands of talented employees, terabytes of customer data, and powerful brands. What they lack, though, are employees who feel like owners.
With rare exceptions, those who work in internal functions aren’t exposed to market forces.
Employees in market-facing roles know that if they fail to satisfy user needs, they’ll get fired by their customers. Corporate staffers, by contrast, can only be fired by their overlords, so that’s where their loyalties lie.
Internal administrators suffer little or no penalty when they inflate costs, offer substandard services, or insist on compliance at any cost.
A company can’t expect to win in hypercompetitive markets if operating units are forced to buy uncompetitive services from internal providers.
Create a Workplace Community
AA’s effectiveness is the product of the relationships that get forged during meetings. Self-acknowledged drunks encourage one another and serve as emotional ballast in the stormy seas of recovery. AA’s model stands in stark contrast to the credentialed and hierarchical structures of formal treatment programs. In AA, there’s no certification, supervision, or monitoring. Therapists and physicians aren’t allowed to participate in AA meetings unless they too suffer from alcoholism. Yet despite the lack of professionalism, AA’s twelve-step communities have helped countless individuals overcome addiction.
“From what looks like anarchy—traditions rather than rules, maximum local autonomy and independence, and absence of centralized or layered tiers of authority—emerges consistency and stability.”
Southwest Airlines: Community at Scale
“The core of our success—that’s the most difficult thing for a competitor to imitate. They can buy all the physical things. The things you can’t buy are dedication, devotion, loyalty—the feeling that you are participating in a crusade."
Herb Kelleher
At Southwest, the building blocks include …
A Mission Worth Caring About
Open Communication, Transparent Data
Feeling Safe Enough to Be Yourself
The Right of Self-Determination
Peer-to-Peer Accountability
Mutual Respect
A Sense of Family
In a community, status differentiators are muted. Everyone feels as if they matter. This doesn’t happen by accident. Instead, it reflects a conscious choice to treat everyone as an equal and to celebrate everyone’s contribution.
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