June 7, 2010 at 12:31pm
A story of how one brave company blended work and play and achieved an unmatched level of performance.
Norman Development was a US based R&D subsidiary of a Norwegian software development company. This subsidiary was just acquired (in 1996) and was a total mess. The product was popular among customers but was hard to maintain. Employees weren't motivated. Nothing was getting done. The level of customer service was poor. A turn-around executive was appointed to make it work.
The turn-around executive (CTO) identified de-motivated people as the main source of the problem. They came to work to get a paycheck and didn't care about results. He decided to change that.
Key Innovations & Timeline
The CTO decided that he was going to blend work and play to such an extent that people couldn't see the difference. The approach was to figure out which staff can most effectively blend the two and get rid of everyone else. He did this in several steps:
1. Reduce the paycheck dependency. First, he decided to change the staff mix to only include people for whom paycheck wasn't the primary reason to work. This means he had to drop an older crowd or people with families and keep people who were young and ambitious and were hot commodities, knowing they can quickly find another job elsewhere. Of course he had to overcome US EEOC laws governing age discrimination in the workplace. To do that, he found a common denominator among people he wanted to keep (other than age) and fired other people because they weren't the right fit in the new culture.
2. Pick staff that wants to play and values teamwork. He narrowed down the staff selection to people who were extroverts, liked working in teams, liked to socialize outside of work, and felt like they were a big family. He made sure people liked each other. Because this was a software company, he picked people who were hungry for technology, were early adopters, and spent all of their free time at home messing with computers (real geeks).
3. Become highly selective. He became highly selective when it came to staff hiring and retention. His entire division (about 30 people) had a turnover of about 50% a month for the next three months. He didn't give people warnings. He didn't give people individual goals. He just told the entire team that this company consisted of the brightest people in the industry. They either had to behave like such people or leave. If things didn't work out, people were terminated immediately. As a result, everyone believed they were the chosen ones if they got to stay.
4. Bring fun to work. He then created an environment that was fun and supported the social values of the people he selected. He eliminated offices and put as many people as possible in one big room with no cubicles. He brought in NURF guns and water guns. He gave his technical staff the biggest and most expensive hardware they could ever dream of. He offered free lunches with lobsters and crabs, sometimes even offering blank checks to any restaurants they pick. He eliminated policies, bureaucracy, and work schedules. He allowed people to freely communicate on any subject at any time. He allowed each member of the team to make his own decisions about his work, never giving anyone any directions other than the overall company vision.
5. Inspire to shoot for the stars. He made everyone in the firm an entrepreneur. Everyone knew what business the company is in and everyone was allowed to directly improve the product or come up with a way to beat competition. He organized the staff to function as a team with a common purpose - beat competition at all costs.
6. Blend work and play. He took away any rules and set long term goals for the firm. He then set his people free to execute. People spent half of their time shooting NURF guns and playing video games and the other half of their time working very hard. Because of the types of people he picked to stay and the environment he created, there was no longer a concept of work vs. play. These people treated work as play. It was as fun for them to shoot guns (play) as it was to debug security software (work).
Challenges & Solutions
The firm had to go through a significant employee turnover. Once the right culture was built, it was no longer an issue. Every remaining employee knew he could find a job (the job market for IT people was hot at the time) the day he was let go. People weren't scared to make decisions though. They took risks. The payoff was great!
Benefits & Metrics
Productivity went up significantly
Product quality went up.
Customer satisfaction went up/
This firm became 100% transparent to employees.
Costs went down (no older crowd that cared about paycheck; less experience of the younger crowd means lower payroll costs).
The level of trust went up
Fear disappeared completely
The person who ran this organization was named George Willis. I was a consultant there.