By the end of October I went to Business of Software conference, an interesting conference about, well, the business of software. Many interesting speakers and interesting people in the audience to chat.

One of the presentations was given by Scott Berkun, who was team lead at WordPress.com from 2010 to 2012. WordPress.com has over 10 billion page views per month, fewer than 200 employees and everyone gets to work from home making it a very interesting environment to think about the future of the workplace. He told us about the advantages and challenges of a distributed work environment, what we can consider as an innovation in management. His presentation was very interesting but when he got to the Q&A session, he got the inevitable question about Yahoo! and their move back from the remote working policy. His answer was very straight forward: since Yahoo! is in a crisis, they cannot afford the management innovation, it is natural that they revoked this policy and returned to traditional management practices, in this case, co-location of workers.

So this got me thinking, whenever a company faces a crisis, it should stop innovation management and should go back to traditional management?

Participative management in a crisis environment

Today I had again the opportunity to join a conversation with Clóvis Bojikian and Heiko Fischer. This was the third or forth encounter we had and, as always, the conversation was very interesting, full of ideas, examples and how-tos related to participative management.

    

At a certain point Clóvis told about a crisis at Semco, during the Collor president years, where the market was abruptly opened to foreign companies. That impacted Semco and forced them to do a downsize, which is always painful. Clóvis discussed with the workers how they wanted to do it and the workers told that they would provide a list of people that should not be laid off either because of age or personal issues and they said to the managers that, preserving the people in that list, the manager could select who should be laid off based on technical criteria. Two things we can pick from this episode:

• Even in a crisis there’s no need to abandon management innovations such as participative management. It’s a good test for the management innovation, to see if it’s capable to cope with the crisis at hand. In this case, participative management was able to cope with the need for lay offs due to a crisis in the market.
   
• There are a lot of numbers between 0 and 1, i.e., it’s not a matter of participative management or non-participative management. There are options in between, there are decisions that workers are willing to cope with and others that they don’t want to cope with and each issue will require a different mix.

It takes a tyrant to sustain participative management

Back in 2008 I read a very interesting article entitled “Sometimes It Takes a Tyrant to Support Collaboration“. We were in the initial steps agile implementation at Locaweb and this article showed that even though one of the outcomes of agile implementation would be self managed teams, this was not a natural outcome, and it requires a constant push from leaders to move into that direction.

Now I have the impression that the same happens with participative management. Even though this is an outcome appreciated by many workers, this is not a natural outcome. It requires that someone forces and sustains the move into this direction. Clóvis and Ricardo Semler did that at Semco. Heiko did that at the largest video game maker in Europe. I did that with my teams at Locaweb. We need to force and reinforce this behavior until it is imprinted in the company’s or team’s culture.

Heiko told about a decision they made in a company facing an economic crisis where the options where to either lay off people or cut 20% of the salaries of everybody so there won’t be any lay offs. Obviously the team preferred the second option. I said to Heiko that in Brazil that’s not an option since we can’t reduce salaries. He told that this is not possible in Europe either, but they figure out a way to do it. Employees would deposite 20% of their salaries in a company fund. At this moment Clóvis told that they also did that at Semco, in agreement with the Union.

Another exemple given by Clóvis was about employee time tracking. In Brazil it is required to have time tracking of all employees but at Semco they wanted to free up the workers from this hassle and show them they trust them. Even though they were subject to a fine if they didn’t do time tracking, they decided to pay the fine but keep off the time tracking to show workers their trust. So they found a way to support participative management even if it has costs.

This is an interesting paradox: in order to implement participative management you need to force it’s implementation, it doesn’t just happen. You need to force and sustain the movement into this direction, even more in crisis.