July 2020

Now more than ever, there is substantial interest in what the future of work looks like in practice or as we commonly call them, the new ways of working. In this blog, I reflect on the book 'CORPORATE REBELS – Make Work More Fun' by Joost Minnaar and Pim de Morree. Initially, I'll review the driving forces behind the need for new ways of working. Then I'll discuss the six steps required to establish new ways of working successfully. The initial inspiration for Minnaar and de Morree's work stems from their personal experience. Both worked in jobs where they were dissatisfied with their companies' status quo approach to work. To contribute to this topic, both authors dropped their jobs and visited organizations and leaders around the world. They created a list of 170 progressive organizations, inspiring thought leaders, and entrepreneurs to learn from and meet. Purposefully they set out to include a diverse range of companies. Spotify expectedly made it on the list, but also Haier, a home appliance and consumer electronics company headquartered in Qingdao, China, and Hollands Kroon, a municipality in the Northwest Netherlands. The eight trends progressive organizations use to define the future of work. Through discussions and visits with most of the 170 organizations and people, Minnaar and de Morree identified eight trends for new ways of working. Progressive organizations focus on purpose and values rather than profit. Companies that take this approach perform significantly better than their peers. Customers are willing to pay higher prices for their products, and talent is more attracted to organizations with a higher purpose. They also found that these companies create a network of teams vs. a hierarchical pyramid found in traditional organizations. People need trust and autonomy in order to perform well. Teams stay small (10-15 employees), are multifunctional, and act like mini-companies within the larger companies, resolving customer issues within the group. Leadership in this organization is supportive of creating environments where people learn, challenge, collaborate and grow. Leaders are responsible for developing people. Decisions are based on content, and people can speak freely without fear. Leaders are evaluated on their capability to enable and develop people. Experimentation and adaptation are the norms as environments constantly change, and those who survive can continuously adapt to the change. Fast learning is required to be successful. Freedom and trust instead of rules and control. In other words, allowing people to experiment with design in their workplace gives them the freedom to decide how to approach work themselves. Progressive organizations require people to make full use of their intellectual capacity, which requires autonomy. Authority is distributed across those responsible for carrying out the task. An inspiring example is the turnaround of the US nuclear submarine, USS Santa Fe, under the leadership of Commander David Marquet. When Marquet was appointed Captain of the Santa Fe, the submarine was considered the worst in the US Navy. To create an environment where change was possible, Marquet decreased bureaucracy and increased morale. He made his crew genuinely own and be responsible for their tasks – turning the vessel in one year to the top-ranked Navy submarine. Radical transparency. Highly successful organizations share not only financial goals and performance figures, but also information. Information is connected to the higher purpose of the organization and motivates people to achieve business results. Talent and Mastery. Progressive organizations find and develop proficiency, making room to transition from job descriptions to job crafting by combining multiple roles. Skills are advanced by employees deciding what skills they need to do the work. Minnaar and de Morree broadly summarized what progressive organizations do successfully in Corporate Rebels. Every chapter in their book includes a summary of the key elements defining the trend. But there is no answer on how an organization can effectively transition from a traditional to a progressive organization. And why should organizations care about ways of working in the first place? Driving forces behind the new ways of working. What drives the need for new ways of working? I see three driving forces that require organizations to review their ways of working: The war for talent, a need for sustainable development, and a rapidly changing environment. The term "War for Talent" was first coined by Steven Hankin of McKinsey in 1997, but this war is still on. And it will continue for as long as the world requires more complex and demanding work, and as long as there are large numbers of people with higher education. Salary remains a central factor for every generation. But while the Baby-Boomers were motivated by a boss worthy of respect, Generation Z looks for the ability to pursue a passion. In the UK, the willingness to stay in any role dropped from an average of 8 years to 3 years in 2018 for Generation Z (Source: Visual Capitalist, May 2019). Organizations that don't offer purposeful jobs will quickly disconnect from the talented and well-educated workforce. The second driver I see is sustainable development, i.e. a more ethical and responsive business culture. Investors are increasingly searching to invest in organizations and projects that have a lasting impact on the planet and strong financial returns. From 2012 to 2018, the global growth in sustainable investments increased by 230% to 30.7Trillion USD (Source: Global Sustainable Investment Alliance, Mar 2019). When Paul Polman became CEO of Unilever in 2009, the FMCG giant announced its strategic intent to focus on sustainable development. Many investors were perplexed and the stock price was around 30 USD per share. When Paul Polman retired in 2019, Unilever only partly met its communicated sustainability targets. However, Unilever continues with a strong commitment to sustainable development, and its share prices have nearly doubled to 60 USD / share - vastly superior to the FTSE index (Source: ft.com, Dec 2018). Every organization ignoring sustainable development not only becomes less attractive for investors but also for the talented workforce. The last driver I identified is the rapidly changing environment, in terms of business and society, in which organizations must operate. The McKinsey Global Institute identified ten significant trends reshaping business and society, including the way we live and work (Source: Visual Capitalist, December 2019). For example, the world is "shrinking" as humans and trade become more connected every day. Technologies like AI mature and create opportunities but have an unclear effect on the future of work. New technologies and related opportunities also create new social challenges for low- and middle-income households. Those trends influence competition which leads to the creation of corporate superstars. Each organization and its leaders will need to adapt to the new realities, or they will diminish. "Design the culture you want, or get the culture you get." Based on these drivers, there are six action areas that are central for integrating new ways of working, which will ensure the successful design and implementation of enhanced operations. Start by developing a strategic intent using a broad scope of inputs and the participation of the entire management team. Rethink and define the operating model. Realign the social attributes of the organization to the future of work requirements, and design an operating model that is flexible enough to integrate technological innovations continuously. Align the organization to the strategy and work that adds value for customers. Make your design process your management and leadership development program. A change impact analysis on any future operating model designed around future of work requirements will highlight that the stakeholders most impacted by the change are the current managers. Create a socio-technical transformation map. Transforming the operating model to integrate future of work requirements requires deliberate planning of the social and technical milestones. Identifying these milestones ensures that the social system is ready before the technical change is implemented. Don't make IT or HR the central authority for coordination of implementation activity. Transforming the operating model is an organization-wide initiative impacting and integrating all aspects of the enterprise, changing both the core value-creating work, the enabling work (such as HR and IT), and the management work and mechanisms. Communicate your HR policy early, covering how those who choose not to work in your future of work environment can leave with dignity. Always be a step ahead when it comes to how people leaving the organization are treated. Put your HR policy in place and communicate very early on in your redesign process. An operating model transformation, no matter how collaborative and inclusive, will inevitably result in the design of future ways of working, roles, and jobs that do not suit everyone. OTM's Applied Star Model provides one framework to do this in a systematic and holistic way, ensuring everything is aligned to the same objectives. Through the application of this framework, future of work attributes embedded in the strategy will naturally be included in resultant design criteria and flow through to a new social system once the new operating model is implemented and the organization has been renewed. Never miss out on OTM blog update. Subscribe to be notified whenever we post. Thomas Doering was a Consultant at ON THE MARK. OTM is the leading global boutique organization design consultancy with offices in the USA and UK. With over 450 successful redesigns and operating model modernizations completed, OTM is owner of the industry’s most integrated, comprehensive and holistic organization design solution. OTM enables its clients to realize their future ambitions.

July 2020

The Impact of Corporate Rebels on Future Operating Models

New Ways of Working – The Impact of Corporate Rebels on Future Operating Models

Tools for Virtual Collaboration: MURAL vs. Miro

How Task Uncertainty Plays into the Social and Technical Coordination of Work