Company configurations
Environments that motivate me to do my best work
There seem to be some parameters of companies that are hard to change after they have been initially set. Certain configurations of these parameters align more than others with my work and what’s important to me. I have previously described what I am trying to achieve with companies I work with in this coaching agreement. I have also described how I work, what I value, and my personal goals in my user manual. This post describes what I look for in a company.
Purpose
😕 No thanks. If your purpose is to make money we are not a match. I’ve got nothing against money per-se. I think it’s a great indicator if you are creating value for your customers. It’s also a great resource to have more impact. However, it’s a means, not an end. Many companies have so-called purpose statements, however, how they measure success reveals what their real purposes are.
🤷♂️ Meh. I am a maximizer. I enjoy making good things excellent. However, I find it somewhat dull to invest my energy into improving the lives of the already privileged. The majority of tech companies seem to fall into this camp.
👌 Nice. I cheer on any company that defines itself through making our lives on this planet more sustainable. I find the thought comforting that someone actually thinks about the planet 50 years from now so that our children and their children get to enjoy life too. A light-weight version of this are companies that do whatever they do in a sustainable way. A lot of companies in the BCorp community are great examples of this.
🤘 Hell yes! What really gets my juices flowing is working on systemic change towards a sustainable future. What if we could change the system in a way that makes the regenerative thing also the easy thing to do? And what if we could do so in a manner that increases the well-being of everyone involved (customers, workers, society, planet)?
Value chain
😕 No thanks. Most companies actively steer towards continuously extending or diversifying their value chain. They chase every opportunity to do more things for more markets. By doing so, they keep adding complexity — and with that more management overhead — to their business. Repeat until everyone is miserable.
🤷♂️ Meh. While diversifying, some companies manage to keep separate value chains mostly independent and the parts of the company that take care of them autonomous — letting synergy effects emerge instead of forcing them. Google seems to do a pretty good job at this. While they have a ton of independent products their common goal is to collect data.
👌 Nice. Some products or services have by their nature long value chains. Only few companies actively work on outsourcing commodity parts of their value chain in order to focus on the differentiating factors. Cause, you know, growth is sexy. Shortening value chains optimizes for internal simplicity and happiness over external validation for growth.
🤘 Hell yes! The shortest possible value chain that you can be the best in the world at. The smaller the company I work for, the happier I am. Why? More intimate relationships, less coordination, more creative freedom. The size of a company is directly correlated to the length of its value chain. The shorter the value chain, the fewer the number of roles needed to deliver on it. Instagram had 13 employees and WhatsApp had 55 when they were bought by Facebook for 1 and 19 billion dollars, respectively. Both had a very clear and simple value chain. Both are market leaders in their domain.
Revenue
😕 No thanks. Most services where users do not pay, they are not the customers, but the product being sold. They (mostly unknowingly) pay with their data or attention which is being sold to advertisers and the likes. I find non-transparent revenue models unethical. Not my cup of tea.
🤷♂️ Meh. Selling my time doesn’t excite me because it doesn’t scale. It has a blatantly obvious bottleneck: me. There is only 24h in a day. It doesn’t work without me, it doesn’t have an impact when I need a break, and it won’t have a lasting impact when I am gone. Consulting falls into this category. While I think it is very helpful, I don’t like that it doesn’t scale.
👌 Nice. Here is where it gets interesting: Selling a product or service that can be easily delivered to many people and also easily scaled up to be delivered to many more on-demand. This means potentially exponential impact.
🤘 Hell yes! I find it easy to advocate for a product when the incentives of everyone involved are aligned: “Everyone” usually includes: the company, its customers, its providers, society, and the planet. Many companies that are part of the Economy for the common good are great examples of this.
Leadership
😕 No thanks. One dimensional hierarchy expects individuals to lead groups in all aspects, e.g. in terms of knowledge, people, and responsibility. It is simply unlikely that one person is great at all of these things. It also only applies to functionally siloed teams. It gets worse when people think they can tell others what to do simply because they outrank them and have the power to punish them. That’s not leading, that’s ruling. Together with the scarcity of these positions, this leads to a culture of internal competition.
🤷♂️ Meh. It gets a lot better once leaders realize that they are in service of the group instead of the other way around. Add a little bit of humility and vulnerability et voilà: you get leaders that are able to say “I don’t know”. This lets them ask the right questions to harness the capabilities of the whole group, instead of thinking they have to have all the answers in order not to appear weak.
👌 Nice. Subgroups with a high level of autonomy require leaders to let go of the illusion of being able to control the whole company. Let’s align on high-level flexible goals to make sure everyone pulls in the same direction. But without the “pretending we can predict the future and being upset when it turns out we couldn’t” bit, please. That just leads to sandbagging, i.e. setting the lowest possible goal that will be accepted.
🤘 Hell yes! Leadership is taking responsibility for the achievement of a goal and attracting others to volunteer their efforts. Leaders use their social capital with integrative power to reach consent for a worthy cause within the group. They hold others to account in a way that helps them grow. Depending on the situation at hand the people with the most competence lead. And just as importantly the same people follow in situations when others have more competence to lead.
Ownership
😕 No thanks. I am done with conventional venture capitalism. Don’t get me wrong, there is nothing bad about getting capital to allow a company to get off the ground. I just don’t find the rat race of growth at all cost, which is usually initiated by VC money, useful for a company to stay on their mission. There are other — harder to come by, but more ethical — ways to get money, e.g. the way Loomio did.
🤷♂️ Meh. When founders own their company they stay in the driving seat and actually get to call the shots. This is a huge improvement over VC owned companies. They get to focus on the company’s mission instead of maximizing shareholder value.
👌 Nice. I find it a lot fairer if other people working in the company besides the founders also take part in profit sharing and governing. I think it’s fair that founders are rewarded for their initial risk and effort. That doesn’t mean they can’t share any of the cake. Buffer and Basecamp are two examples for companies that have simple profit-sharing schemes. Platform coop is a model I find interesting in this regard that also includes the users of a platform.
🤘 Hell yes! The most intriguing model of ownership I know so far is steward ownership. Once all investor shares are bought back the company owns itself and is no longer treated and traded like a slave. It is governed by people within the company. Sharetribe nicely documented their way of doing this.
Scoring
I use these parameters to score the attractiveness of companies. Assuming all else being equal, the higher the score, the more fulfilling I will find working with this company. Landing in the 😕 No thanks column leads to two minus points (-2). A parameter in the 🤷♂️ Meh column does no harm but doesn’t attract either (+0). Parameters in the 👌 Nice column score one point (+1), while parameters in the 🤘 Hell yes! column score three points (+3). Consequently, companies can score between -10 and +15 attractiveness points.
You can find out about what I do in this coaching agreement. You can find out about how I work, what I value, and my personal goals in my user manual. If you read this far, let’s talk.
