How to Build a Decentralized Organization
“Not finance. Not strategy. Not technology. It is teamwork that remains the ultimate competitive advantage, both because it is so powerful and so rare.”
— Patrick Lencioni, The Five Dysfunctions of a Team: A Leadership Fable
TL;DR: If you are in the process of having to build a decentralized organization start with the culture, followed by training your teams in collaboration, communication and facilitation skills. Last but not least don’t forget to develop the individual people this will provide the most ROI.
Note: This article is written from the point of view of culture, team and individual development. Acknowledging that governance processes, decision making, and dispute resolution are also very important to decentralization. We will parse that out for another article soon.
On Decentralization
Futurists have been predicting a decentralized world for some time. In his 1982 New York Times Best Seller, “Megatrends”, futurist John Naisbitt’s made a case for the world moving from “centralization to decentralization.” His book sold 14 million copies. Open source software like Linux and peer to peer platforms like Napster and Bit Torrent have been good examples of decentralization in software and now Blockchain companies are pushing decentralization front and center in how companies, teams and eco-systems work.
Start with the Culture First
Management guru Peter Drucker famously said “Culture Eats Strategy for Breakfast”, yet most companies merely pay lip service to this. More often than not they define their cultural values put them in a Powerpoint Deck and share it a few times. Best case scenario print posters with their values and send them to all their offices. But culture is a living, ever shifting organism that like that succulent on your desk (that you got at your house warming party) it needs to be fed, watered (just enough) and taken care of. Otherwise it dries up and dies. So how do you establish and maintain your culture?
- Broadcast your values and principles continuously.
Not in listicle form with a brief explanation but in a living conversation about what it means to have these values. What are tangible examples of these values being lived? What real scenarios are playing out in your organization? Via videos, podcasts, webinars and skits that play act how your cultural values and principles look in action. Better yet hire and organizational management expert and an internal content creator and embed them into your organization to gather the stories and challenges faced every day by your teams. - Include everyone in evolving your values and principles.
As you you grow, your culture changes, evolves, transforms, both in positive and in negative ways. It can be easy to ignore or deny the negative direction your culture is taking, but it is always better to name it. That is best done in an action oriented way. For example if a cultural value of your organization is transparency but the culture has shifted towards opacity and information hoarding then say “How can we be more transparent and reduce information silos?” Start the conversation.
Create a space to prioritize, discuss and flesh out the values.
To help keep the culture fresh and up-to-date, creating a living culture index as a web-based tool and have people vote on which values are most important to them. This can also be a place for people to share their stories and views on your cultural values. Ultimately, this will create a sense of collective ownership of your values and more importantly make people feel included. - Train teams together in culturally aligned tools and processes.
Sticking with the transparency value from earlier, If teamwork is a value, train your teams in facilitation, prioritization and communication. If compassionate leadership is a value train your team leaders in what that means and how to be a compassionate leader.
Develop your Teams Early and Continuously
In a fluid, decentralized organization, project and product and product teams form and dissolve frequently. First, you have to make this ‘OK.’ Meaning let your people know that this will happen and it’s ‘OK’’. Whether it happens because of team friction, changes in market dynamics, initiatives failing to get traction or simply the successful end to a project, the “dismount” is as important as the floor routine. So start by providing a playbook for starting a team and ending a team.
- Provide guidance on how to form a team (Circle).
It’s easy to assume that everyone knows how to do this. But more often than not even seasoned specialists have limited experience in forming or running successful teams. I might be an experienced Developer who has created amazing software, but I might have limited real world experience in setting up a functional team. Having a playbook that helps me guide my team through establishing and aligning on a Vision, Mission, Goals, Objectives, Risks, Roles and Responsibilities, Project Roadmap and Project Budget would help prevent many challenges down the road. Equally, if not more, important is building team communication agreements and developing an internal practice of continuous feedback do wonders to help avoid common friction points and bottlenecks. - Have team members understand each other’s communication styles.
How we communicate depends a lot on our innate thinking and behavioral patterns. Someone who is more analytical and structured will focus on and communicate based on these traits. If they are communicating to someone who is more creative or relational this often causes friction. Not because of what they are saying but become of how they might be saying it. I often hear software developers admit that they change how they provide feedback when they address designers versus when they give feedback to each other. But it is not only designers who might be differently wired, even fellow software developers often run different behavioral “Operating Systems.”
Using tools like the DISC Assessment or Emergenetics to assess each team member’s natural communication styles and interests is a great start. You might be skeptical and think that “these things never really work” but they do. And they have a marked impact on how team members behave with each other. Imagine knowing that you are more imaginative and intuitive in how you communicate and your teammate is more of an analytical and practical thinker. Now you will understand why they often seemed so uncomfortable when you come up to them with big eyes to share your vision for a feature or tool you are designing using big metaphors and effusive emotional language. When they respond with a dry “And how does it work?” Or “that won’t work.” you are always upset at how close minded your teammate is. Had you done a behavioral assessment and had a conversation about it together, you would laugh at knowing you each express yourselves based on your innate style.
Don’t Forget Developing the Individual People
It took me a long time to realize how important this is. In my 20’s I honed the skills in my CV and discovered my natural talent for building teams. In my 30’s I learned how to grow an organization. But it hasn’t until today, in my 40’s that I have finally understood that it is unlocking and developing the individual capabilities of your people that provides the highest ROI for an organization. In time it became clear that even people with pedigree, connections and the best skills in their field hit a ceiling when you introduced autonomy, speed and uncertainty to the decentralizion equation. At that point emotional intelligence, communication and leadership skills become as important as how smart or accomplished they were.
- Get to know the humans on your team.
Not just their job history but their life history both past and current. This will help team members relate to each other and also give team facilitators a better understanding of the team members world view. Knowing where a teammate grew up, what their parents did for a living, whether both parents are alive, still married, retired or still working and how many brothers and sisters then have goes a long way to understanding your teammate. At a minimum in relating to them. This is often seen out of bounds in corporate culture, or something that you do after work over beers or at the yearly “Trust Falls and Long Powerpoints” retreat everyone loves to hate. But in the hands of great leaders and great teammates this information is gold. The first thing you should do is have each team member define their purpose. - Provide the tools and opportunity for individuals to define their purpose.
Have the individuals write and share their purpose with each other. Encourage individuals to share their purpose openly with others in the organization. This will help people find others with a shared purpose. There are many definitions of a what a “Purpose Statement” is; but the short of it is that they are just like a Mission Statement or Brand Statement. They define who you are, what you do, how you do it, for whom what the impact is of what you do. Below is an example of my personal brand statement. I didn’t come up with it, it was created by the people I serve. This is what they saw me being.
“Jose provides live training and facilitation to powerful leaders in a quirky way with a caring voice. Helping them feel empowered and assured.” — May, 2014 - Pair-program as much as possible.
Decentralized orgs are self-organizing, which is awesome for self-directed and swashbuckling individuals. Though there are many leadership nodes in the system the lack of a hierarchical structure often leaves a feedback vacuum. “How am I doing? Am I doing the right things? Am I doing ok?” Not knowing the answers to those questions can cause a lot of anxiety for many. In the absence of formal feedback mechanisms borrowing “Paired Programming” from tech culture is of great value. Having two people formally assigned to work together provides both feedback mechanisms and an accountability system. The main impact of implementing “Paired Working” is that you get a boost in productivity by not losing the momentum that comes with not being sure what your direction and focus should be. Training your paired working teams in how to coach /consult each other is a masterful way of helping individuals express, troubleshoot and overcome obstacles.
Bonus: Help people uncover and solve their own problems.
Finally providing the individuals and teams with enough of the necessary resources to troubleshoot challenges and learn new skills is a critical focus. Rather than adding more and more managers, invest in hiring facilitators, coaches and servant leaders who are focused on training, coaching and removing obstacles both organizational and personal is imperative. Better yet hire people (in any role) who are attuned to these skills naturally by hiring based on Emotional Intelligence and not just pedigree and CV’s.
In closing, if you are in the process of building a decentralized organization start with the culture, train your teams in collaboration, communication and facilitation skills and don’t forget to develop and grow your people. They will provide the highest ROI for your organization. Focusing on these three areas will help you cultivate fertile soil on which your organization will grow and thrive.
Much Love,
-jc
Special Thanks to Sarah Durlacher for contributing to this article.
