No 6: Our unforgettable journey to trust, transparency and eventually success (Guest Blog)

// Blog number 6 is a Guest Blog from Mats Lindblom, Meridium CEO
// This is a shorter version in English of the original blog written in Swedish.

“Year 2010, we had good skills of different methodologies, but still we had failed, several times in a row, to use agile and scrum practices in our customer projects. We were getting to a crossroads and tough situation. We should either give up and accept the consequences or continue believing and try something totally different. We decided to put all-in and head towards something unknown and scary. Our analysis was saying that it’s not enough that only teams and projects become agile, instead the whole company needs to fundamentally change. This meant that we needed to question all our existing beliefs and ways-of-working. There was no room for any more failures, otherwise our people would loose their faith and the company would collapse.”, explains Mats Lindblom, CEO of Meridium, about the situation in 2010.

Meridium

Meridium is a company designing and building digital services in order to make end-customers’ and users’ everyday life easier and better. Meridium has around 60 employees in Kalmar and Stockholm and today is part of Tieto CEM (Customer Experience Management) business unit.

Meridium Team

Our journey

One of the reasons, why we were in a deep trouble in 2010 was that from the very beginning we had been a traditional organization of managers, team leads, leadership teams etc. where only a limited group of people had access to the information and possibility to truly impact and make decisions. Our teams were not empowered and there was a big gap between sales and deliveries. The individuals in the teams felt like being “code-monkeys” waiting for instructions and commands to land on them.

However, there was lot of good elements and potential in the organization. Good people, customer oriented thinking, commitment, high quality, enthusiasm, curiosity of new things — but it was our company models that prevented that asset to shine at its best. Our cultural elements of humbleness, willingness to help each other and the psychologically safe environment created a good platform for the challenging journey. What is important to underline is that it was not a one-man-show, instead all the people in the whole organization have had significant contribution in our transformation.

Change the way we change

Latest research and studies show the alarming facts about how often “Change/Transformation programs” are perceived ineffective and sometimes even total failures. Typically it relates to changes being driven by top management without proper involvement of the organization and changes are planned like big comprehensive programs where the change is expected to happen in a very short period of time.

At Meridium we decided to change the way we think about change and choose a totally different path. Our new principles were to (1) involve the whole organization from day-1 with full transparency, (2) not plan too much beforehand, but explore and take incremental small steps, (3) foster agility and continuous adaptation.

In our change journey we didn’t have a clearly defined objective or target state. We had a direction and some kind of vision, but we didn’t have any idea of how long the change would take. Our inspiration and vision was to build a company culture that puts people at the center and is adaptive to anything that happens in the complex world around us. Fostering positiveness, joy and well-being in people were important for us.

Trust and transparency

Reflecting back afterwards, I think that ‘courage’ has been the most important factor in our journey. Meaning that we dare to choose our own way and dare to trust the organization’s ability to find solutions to any problem. All this requires extreme transparency to make the teams and people empowered. In practice, we decentralized all planning and decision making so that teams were doing that as part of their daily routines. Teams were also actively involved in all sales operations from the very beginning and had a strong word to say which cases to take forward and how.

Success

Step-by-step we started to see small signs of progress and eventually it became a great success for us. All the teams were taking strong ownership and responsibility of operations. Clients’ satisfaction broke the records. We were able to drastically reduce the need for internal meetings and administration and the pace of innovation got to a new level. Teams were proactively improving our operations in all areas and teams where exchanging ideas across the whole company with good co-operation. All this happened without any management which was a clear evidence that Self-organization really works!

Epic Failure

Year 2014 we got highly inspired about the Frederic Laloux book ‘Reinventing Organizations’. It felt like a perfect guide for solving our problems and it felt like the ‘Teal’ model was the description of our unknown target state.

We got so excited that we started to implement Teal full-blown to our organization straight away. It didn’t work out and we learned the hard way that pushing a ready made model to an organization is not the way to go. We learned our lessons and later on we worked on creating our own version and adaption of Teal and involved the whole organization into this exercise.

Decision making — Salaries — Feedback — Conflict handling

During the journey we realized that we need to fundamentally change many core elements of our operations in order to reach the vision. This was demanding and we were faced with questions like: How do we make decisions when there is no-one clearly responsible based on his/her role or title? How to place incentives for people when the traditional career path doesn’t exist in a flat organization? How do we foster feedback in an organization where there are no managers having a formal role and models for giving feedback? How to handle conflicts in a situation without hierarchies and authority originating from the structure?

This might sound and feel dangerous next to anarchy and chaos. However, for the people with the ‘Teal consciousness’ all this is a positive challenge and creates energy. The consciousness creates a strong belief that all this can be solved in one or another way if you just dare to trust the process and path chosen. We were building our consciousness and belief by studying different organizations like Zappos, Netflix, Spotify,Valve, Slack, Southwest Airlines, Buurtzorg och Semco Group and concepts like Teal, Holocracy, Sociocracy och Management 3.0.

In our process of studying, testing and learning we iteratively came up with following practices:

• Transparent salaries. Everyone knows each other’s salaries and salary increases are set by the whole organization together, not by any manager.
• Two alternative processes for decision making. Advisory Board or Concent method.
• No formal managers. However, there are several strong leaders.
• Everyone involved in setting the direction and strategy for the company (strategy forum approach). No leadership team exists.
• All information 100% transparently shared to everyone
• Conflict management with a trusted advisory approach
• Continuous feedback process in teams all the time

CEO role in the process

What has been my role as CEO in this journey? My mission and guiding principle has been to create a company that would operate smoothly without a CEO with very adaptive and resilient living organism type of organization. During the journey I have tried to paint a shared vision for the future, and encourage the individuals and organization. I’ve tried to be always available and present. But, maybe the most important factor for me has been to try to stay out from the everyday decisions and show that I trust the organization. I have also been working on removing potential blockers of internal politics, egoistic behavior etc. Celebrating success together and creating a safe environment has been important.

What is success depends on your perspective

One can ask, if this journey was a success or not. Answer depends on your personal definition of success. For me personally this is definitely a success story. We have learned a lot in 10 years. We have shown to ourselves and others that there truly exists other alternative ways to operate companies than the ones we all are familiar with. We have shown that it’s possible to get results with a real ‘family feeling’, where peoples’ wellbeing is prioritized over short term economic goals. Paradoxically, at the same time we have experienced economical success that many of our competitors have had hard time to reach.

Wind of change

Without going into details here, the changes in the markets and technology landscape created a situation where we saw a need to become drastically bigger with a wider offering for being able to stay relevant and competitive for our customers in the long term. The owners and board of Meridium started to investigate M&A opportunities for selling and merging the company with some bigger player. With the 10 years journey and family feeling this was a demanding and tough process. Our requirements were clear: In addition to proper business fit, we needed to find a company and organization that shares our culture and values, otherwise it is a No-Go.

Our principle of 100% transparency kept us awake at nights. We discussed a lot about pros and cons of sharing the M&A ideas and status to the organization. We had a fear of causing too much uncertainty and we decided to compromise our transparency principle and didn’t share the information to the organization. It was maybe the toughest decision in my life to behave against my own and company’s values and I felt betraying the colleagues and organization.

In the process we met several candidate companies. Despite the companies were really good and professional, we always felt that something important with the cultural fit was missing. One day Tieto came into the list and our advisor persuaded us to meet the company. Persuasion was required since our view was that Tieto would not share the values and culture we have. With low expectations we took the meeting and sat down together with people from Tieto CEM unit. That meeting became something totally different we had ever expected. Very soon we got a strong feeling that we are discussing about the same core beliefs and we had very similar vision & values.

Because the stakeholders (Meridium and Tieto CEM) didn’t have the “mainstream beliefs and culture” the M&A process became different to a typical, straightforward acquisition process. In the process we worked a lot together for combining our beliefs and purposes and to build a strong trust between the people and companies. Even if we were in a process of negotiating the deal, we had high transparency and honesty in all our discussions. Already in that phase we created a detailed idea and joint “Game Plan” for going forward after the deal would be signed and announced.

Summary and my own learnings

• For succeeding in transformation you need to change the way you think about change
• Clear purpose is essential. Everyone shall be part of creating the joint purpose.
• Transparency creates trust.
• Never compromise. Think about Greta Thurnberg as an example of mindset.
• Create an environment of safety, where it’s safe to fail.
• Create processes that secure the adaptivity, so that you ideas and learnings are always taken into account.
• Focus always on the customer! Transformation might attract people to focus on internal things. It is important to remember the customer focus.
• Copying and using some ready made model never works. You need to build it yourself.
• Change shall be initiated bottom-up and supported top-down.

Mats Lindblom

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Blog series:
No 0: Call for Paradigm Shift in Management
No 1: Magnitude of Change when Shifting Management Paradigm
No 2: Why do so many companies manage people like machines and why is it one of the biggest problems of our times?
No 3: How to drive paradigm level change? — Our learnings and one crucial breakthrough innovation
No 4: Incredible India and breaking the hierarchy
No 5: Management paradigms in a nutshell, inspired by Frederic Laloux book Reinventing Organizations
No 6: Vår oförglömliga resa till tillit, transparens och framgång (Guest Blog)
No 6: Our unforgettable journey to trust, transparency and eventually success (Guest Blog)
No 7: We all know that “Carrot and Stick” model is outdated — Why is it so damn hard to implement new ways?
No 8: The Power of Purpose
No 9: Finding your purpose and living your life with it can unleash tremendous potential