The soul of a start-up, nimble leadership, flexibility and control

By Elisabeth Goodman, 5th August 2019

Remember Gary Hamel’s article last November about how to retain employee engagement in growing and large organisations?

The latest issue of Harvard Business Review (July – August 2019) carries two articles that provide some stimulating and converging ideas about how to achieve employee engagement through a combination of control and flexibility.

It is good food for thought in the context of another article on employee engagement, from the 31st July Business Weekly, which I reference in the conclusion at the end of this blog.

The start-up “soul”

The first article is by Ranjay Gulati (a professor at Harvard Business School) which essentially shows us how to retain engagement in start-ups.  It all hinges around what he calls “the soul of a start-up” – discovering what this is for your organisation, and then putting in measures to retain it.

Image inspired by Ranjay Gulati’s article: “The sould of a start-up”, HBR July-August 2019, pp. 84-91

Ranjay Gulati studied more than a dozen fast growing ventures, and interviewed 200-plus founders and executives to help him reach his conclusions.  Although the companies he spoke to are US-based, and did not include the kinds of Life Science SMEs we work with at RiverRhee , what he deduced certainly resonates with our experiences.

THe three dimensions of a start-up’s “soul”

Ranjay Gulati has identified three dimensions (“the spiritual trinity”) of a start-up’s “soul”:

1/ Business intent. Employees are energised in SMEs by being connected with what their organisation aspires to achieve – also referred to as the vision, mission, purpose, or meaning of their work.

2/ Customer connection. An intimate understanding of the perspectives and needs of their customers will enhance employees’ energy and creativity.

3/ Employee experience. This is described as giving employees “freedom with a framework”, “voice and choice”, or basically the autonomy to innovate and make decisions within the context of the company’s overarching purpose and general rules of engagement.

balancing control and flexibility

Ranjay Gulati’s experience is that start-ups will fail if they don’t introduce structure and discipline to support them as they grow.  But they do also need to be uncompromising about their original business intent, maintain strong customer connections and ensure that they retain the flexibility that will allow employees to be autonomous and passionate about their goal.

The author cites examples from Netflix and Warby Parker for how to do this.

At Netflix, the message to employees, once managers have made the context about the organisation and its operations clear, is: “We think you’re really good at what you do.  We’re not going to mandate how you do it, but we’re going to trust and empower you to do great work.”

At Warby Parker, they developed the “Warbles” program, where engineers are asked to suggest and advocate new technology initiatives, and to position them within the context of the organisation’s strategic intent. Although the ideas are voted on by senior management, individuals can also pursue any that they choose if they align with their priorities and can deliver “maximum value”.

RiverRhee delivers training, workshops and one-to-one coaching in range of management and team member skills.  See our website for more information.

“Nimble leadership”

Deborah Ancona, Elaine Backman and Kate Isaacs (all associated in some way with MIT), approach the subject of employee engagement from the perspective of retaining employees’ entrepreneurial spirit in mature organisations.

They use PARC and W.L.Gore as case studies in their article (Nimble Leadership, HBR July-August 2019, pp. 74-83) to describe three types of leadership, which, together with clear cultural norms, also result in a balance of flexibility and control.

THree types of leadership

Deborah Ancona et al’s three types of leaders and their characteristics are as follows:

1/ Entrepreneurial leaders who are very much in the frontline of the action in the two companies.  They “sense and seize” opportunities, or new initiatives, and influence their colleagues to join them, or provide resources to make them happen.

These entrepreneurial leaders are again well-tuned into the strategic goals of the organisation.  They have the self-confidence and energy that enable them to exercise autonomy.  They are also good at influencing and persuading others, whilst having the openness to listen to others’ views and the flexibility to change course if it makes sense to do so.

[These sound like they could be the senior scientists, or project leaders that we encounter in Life Science SMEs – but with a significantly different decision-making and resource allocation model.]

2/ Enabling leaders are generally more experienced than entrepreneurial leaders, and are there to coach, develop and connect the entrepreneurs to each other.  They also have a strong communicating role to ensure that everyone is kept abreast of the bigger picture:

• What activities others are engaged in
• The overall business context (which includes the vision, values and simple organisational rules – all key “guardrails” for decision-making)

[These sound like they could be the line managers we encounter in Life Science SMEs – but with a much more explicit remit for talent development and support.]

3/ Architecting leaders are essentially the senior leaders in an organisation who are paying attention to the bigger picture, and changing remit, culture and structure.  They initiate change, and will also respond to how the ‘bottom up’ initiatives may be a prompt for change.

Conclusion – some refreshing ideas for tackling employee engagement

These two articles have some very refreshing ideas for creating the combination of “flexibility and control” which seem to be key to achieving employee engagement.

Jennifer Leeder (Senior Associate at Birketts LLP) has some sobering data about the current state of employee engagement in the UK (“Taking steps to improve employee engagement”, Business Weekly, 31st July 2019, p. 14).

She quotes a 2017 Gallup analysis, State of the Global Workplace, revealing that only seven per cent of UK employees are actively engaged at work.  The data no doubt vary by sector but that is little consolation for this very low average.

I was interested to find three measures in Jennifer Leeder’s article that echo those in the HBR articles and would also create and support environments featuring flexibility and control:

1. Define your culture. She mentions company values as a component of culture.
2. Keep open and honest communication flowing between managers and employees.
3. Develop your leaders and managers

How rigorously are you preserving the ‘soul’ of your organisation?  Are you making sure that everyone in your organisation is connected to your strategic intent, perfectly attuned to your customers’ perceptions and needs, and exercising autonomy within this well-defined framework of mission and values?

Are you keeping the communication flowing in all directions?  And are you developing your leaders and managers to sustain this way of working?

Notes

RiverRhee‘s offerings include team building workshops and leadership and management development. We can help you to articulate your vision, mission and values, as well as develop your team.  You can see further details and testimonials on our team building workshops and on our management development.

Elisabeth Goodman is the Owner and Principal Consultant at RiverRhee Consulting., a consultancy that specialises in “creating exceptional managers and teams”, with a focus on the Life Sciences. (We support our clients through courses, workshops and personal one-to-one coaching.)  Elisabeth founded RiverRhee Consulting in 2009, and prior to that had 25+ years’ experience in the Pharmaceutical Industry in line management and internal training and consultancy roles supporting Information Management and other business teams on a global basis.  RiverRhee is a member-to-member training provider for One Nucleus. 

Elisabeth is accredited in Change Management, in Lean Sigma, in Belbin Team Roles, MBTI (Myers Briggs Type Indicator) and is an NLP (NeuroLinguistic Programming) Practitioner. She is a member of CILIP (Chartered Institute for Library and Information Professionals) and of APM (Association for Project Management) in which she was a founding member of the Enabling Change SIG.

The “Lean Startup” approach to understanding customer needs

By John Riddell

Notes from a Cambridge Network talk by Eric Ries

I attended the January Cambridge Network meeting, which was focused on a talk by Eric Ries, the author of a new book entitled “The Lean Startup”.

Eric had developed the book based on the lessons learned by entrepreneurial start-ups of software companies that he had worked with in California’s Silicon Valley.  Most of these companies had been driving forward Web 2.0, and had either failed or been taken over.

Opportunities to use Lean to improve start-up success

Eric saw the opportunity to apply Lean principles both to identify value in the eyes of the customer, and to reduce the cycle times involved for gathering and obtaining learnings and so improve on their performance.

He described a “pivot approach”.  This involves “keeping one foot planted in what your idea is and the other moving with learning”.  The idea is that, as you gain feedback on your product or idea, you “pivot” (or change your plan) towards what the customer really wants.

The value of focusing on what your customer wants

The “Lean Startup” approach resonated with me as “focusing on your customers” is RiverRhee Consulting’s first principle for enhancing team effectiveness.  This enables you to identify what your customers want (and not what you think they want).

Of course you need to work out how to find out what your potential customers want, and it might involve recognition of the failure of the bright idea that you were so enthusiastic about!

Experimentation vs. customer surveys

An interesting point in Eric’s presentation was his differentiation between using a customer survey, where a broad range of feedback can be obtained from a wide sample of customers (with the results shaping general direction and strategy), and the use of experimentation.

With experimentation, customers can handle a product (in a trial or pilot), give feedback on the product, and, most importantly, give feedback as to whether they would purchase the product or not.  Once you have that knowledge and recognise that you need to change direction then you need to fire up and go again!

The more frequent the number of cycles in which this occurs the better.

In his presentation Eric emphasised that there is no point in brilliantly executing a start-up plan to produce something that nobody wants.  He also emphasised not leaving change “until the building is on fire”!

Closing thoughts

TV programmes like Dragon’s Den and The Apprentice have given us all more exposure to the concept of entrepreneurs and new business start-ups.

Eric’s background with software company start-ups in Silicon Valley seems a long way from the pharmaceutical manufacturing environment that I’m familiar with.  It was very interesting to see both kinds of organisation connected by Lean principles.

Notes

John Riddell is an Associate with RiverRhee Consulting.  He has held technical, operational and project management roles in pharmaceutical manufacturing working with both small and large teams from a local to a global basis. John is a certified practitioner in Lean Six Sigma and is highly experienced in knowledge management.  He has developed a successful programme to coach leaders in developing teams that have multiple cultures and are spread across global locations.

 

Deep Visuals Ltd – how Kodak’s knowledge assets did not quite ‘walk out of the door’

When Alan Payne, then Director of Kodak’s European Research team, found out that his 25 strong Cambridge unit was to close in early 2009, he spotted an opportunity that was to prove irresistible.  He suggested to one of the US business heads that they could continue the project they had been working on, outside of the Kodak umbrella, and do so at a lower cost. His US colleague had been very upset by the upcoming closure, and Alan’s suggestion made his day.  Alan’s colleague persuaded others in the US, and, before long, the contract was signed and in place.

I met Alan at one of Cambridge Network’s events, and when he told me about this, I asked if he would be willing for me to put together a ‘case study’, as a response to some of the comments I had received to an earlier blog: Knowledge assets have been walking out of the door – is anyone taking note?’ Alan kindly agreed, so here then is the rest of the case study.

Kodak’s European Research team had itself been the result of substantial organizational change when, in 2005, the umbrella organisation decided to consolidate the previous teams in Harrow, North London, and in France, to create the Unit in Cambridge. More than 200 people had been cut back to just 25 when the new Unit opened in January 2006.

The Cambridge team had been instrumental in introducing a new culture as a result of the transition from film to digital images. Whereas Kodak had previously been one of only a few companies in the world with expertise in film, they were suddenly vastly out-numbered by all those with digital expertise.  Alan, and the previous Director of the unit, Sam Weller, convinced Kodak Research to adopt what became an example of the ‘open innovation’ model.  As Alan describes it, the model is like a pair of scales: you give some of your technology away, but this is vastly outweighed by the expertise that comes in.  Although the US really liked this model, they could not afford to continue funding it, hence the closure of the unit.

Now Alan, and Peter Fry, each with more than 30 years experience at Kodak, co-own Deep Visuals Ltd, and run it with 2 other members of the original team, as well as a 5^th team member that they’ve recently taken on.  They provide Kodak with an invaluable worldwide perspective on their client base and on product design and development – an important counterpoint to Kodak’s otherwise strong US focus.  They draw on a wide network of consultants, many from Cambridge University’s student population.  And they use a strong user-centered approach for product design, an important strategy where large organisations often risk relying too much on a technology-centered approach.

Kodak is very supportive of Deep Visuals current attempts to broaden their client base and strengthen their financial footing.  One area that Alan is exploring is museum collections.  He sees parallels between the challenges that we as individuals face in managing our personal historical photographic collections and those that museums have in making their vast collections of artifacts accessible to the public.  He is applying for grants to research the museum sector and to develop demonstrations of what might be possible.

This latter is in itself an example of Knowledge Management: an area that Alan also previously championed within Kodak.  He and his then colleague John Trigg believed that Knowledge Management was all about culture and people.  They were cognizant that people’s knowledge could be easily buried and lost and they promoted the use of electronic Laboratory Notebooks (eLNBs) as a way of making their knowledge more accessible.  Additionally, when the European Research team was due to be closed, Alan and his peers in the US set up a few interview sessions between the UK and US staff to enable sharing of knowledge.  They also ensured that all work in progress was fully documented, and of course that the eLNBs were available.

Finally, the existence of Deep Visuals Ltd itself, has obviously ensured that their invaluable ‘knowledge assets’ continue to be available to Kodak.

For Alan, the experience has been very liberating.  Like many who have spent most of their working life in the corporate world, he assumed that it would be very difficult to start up his own company.  With encouragement from his friends, and the support of Business Link, Alan was encouraged to go ahead, and was amazed at how easy the whole process was.  The hardest thing was coming up with a unique name!  Now, Alan is keen to ensure that the development of his staff is not overlooked.  He is beginning discussions with individuals to understand their technical and personal goals, and to ensure that Deep Visuals continues to be an exciting place to work.

Note:

This case study is one of a series that I am pulling together along my company’s, RiverRhee Consulting, 4 main areas of expertise for enhancing team effectiveness for improved productivity and team morale:

1. Focusing on your customers
2. Simplifying and streamlining what you do
3. Optimising information and knowledge assets
4. Ensuring successful business change

If you would like to share a case study relating to how your organisation is addressing these topics do please get in touch and I would be happy to discuss documenting it in one of my blogs.

You may also be interested in taking advantage of one of my complementary monthly Friday afternoon clinics

You can find more information about RiverRhee Consulting, and about me, Elisabeth Goodman, Business and Information Consultant, on http://www.linkedin.com/in/elisabethgoodman, and in the Cambridge Network directory, http://www.cambridgenetwork.co.uk

(A consultant’s) Life is like a game of Rummy..

Rummy is one of our favourite family card games.  For those not familiar with it this site might help http://www.pagat.com/rummy/rummy.html.

My husband and I were mulling over this at breakfast today.  To be effective as a consultant you need to be able to spot the opportunities that might ‘win’: you might be lucky enough to win from your starting hand, but it might be something in your hand that you had not spotted straight-away, or a chance card that you pick up on the way and decide to try your luck with.  And of course you need to pay attention to what’s going on around you!

Dafydd Wright at RSA http://www.thersagroup.com/ told me to look for any trends in the jobs that I was turning down, because that would be a good indication of what people wanted (and that they thought I could offer something in).  I am in fact finding that there is a pattern in the assignments that are coming my way, which luckily I have not been turning down… and they are all to do with business skills for information professionals, and information strategies for business.  This isn’t quite the cards I’ve been leading with, but I’m finding it very exciting to reconnect my original Information Management skills, with my business skills.  So, I’m reconsidering my ‘usp’..

I’d love to get feedback from the people who know me, and the people who don’t on any aspect of this posting.  I like this analogy too, from Tom Hanks as Forrest Gump: “Life is like a box of chocolates: you never know what you’re going to get.”