Customers, employees and stakeholders demand increasingly more from businesses. Unfortunately, hierarchies and centralization prevent companies from evolving and responding as fast as they need to. A 2020 study of 28 companies revealed that 100% of organizations with decentralized management structures experienced positive market-cap growth, while only 33% of companies with traditional structures could say the same. As the co-founder and CEO of a self-managed company, I can say for certain that businesses will need this structure to survive in the future.
Self-management in the workplace is often seen as operating with no formal hierarchy, which is true to a certain degree. Employees in self-managed organizations are given the freedom to organize their time and work in whatever ways best suit their individual needs. However, they also understand what’s expected of them and how their contributions relate to the organization’s overarching goals.
Don’t misunderstand: Companies that use self-managed teams will still rely on you as a manager to offer input and directives, but you’ll provide these on more of a “trust-and-verify” basis rather than the traditional “command-and-control” style. A decentralized management structure has a lot to do with self-responsibility and instilling this trait within all employees. When done right, people find more purpose in their work. According to some studies, self-management provides employees with more motivation and job satisfaction than traditional work structures.
Your challenge as a manager is to create direction and maintain alignment between greater autonomy and your company’s growth. Without direction, decisions might not produce the intended outcomes. A lack of direction can also leave workers questioning their responsibilities, which can lead to turf wars and departmental silos. By cultivating self-management in the workplace, you can better prepare for the future of work and use your abilities to prompt individual growth.
Building self-management skills in your team.
Companies that use self-managed teams don’t adopt this model by chance. They work toward the structure with intent, helping employees develop self-management skills. If your business is decentralizing management, here are a few ways you can help your team develop the skills they need to succeed:
1. Encourage team members to embrace self-expression.
First and foremost, outer change requires inner change. Your team members’ personal development journeys will be key to establishing self-management skills. Encourage them to uncover their purposes, values and belief systems (i.e., “ikigai,” which is the convergence of what someone loves, what they’re good at, what they can contribute to the world and what others will pay them to do).
Part of helping team members embrace self-expression involves facilitating the right environment. Employees need a safe space where authenticity is valued, as it can be difficult for people to express themselves when they’re uncomfortable sharing ideas, opinions or emotions. The onus of creating that safe space is on you as a manager. So, start genuinely listening, supporting team members when they don’t feel like they can express themselves and appreciating everyone’s distinct differences.
2. Establish objectives and plans that encourage spontaneity.
To some extent, structure drives human behaviors. And with the sum of collective human behaviors building a culture, a balancing act is necessary when it comes to the hierarchy of a self-managed team structure. Even the slightest disparity in central processes can limit autonomy and prevent people from being spontaneous in ways that serve businesses well. This isn’t to say an organization should operate without structure, but more so with a structure that’s organic in nature to encourage creativity, critical thinking and intrinsic motivations.
Learning how to be spontaneous—or at least supporting greater spontaneity in the workplace—often comes down to plans and objectives. Plans can change, especially long-term ones. As a manager, you must understand this fact and instill the idea in team members. When it comes to planning, you should aim to identify gaps between the plan itself and the potential outcomes. It can highlight opportunities for rapid learning. With bigger initiatives, small, more incremental activities offer the flexibility and agility necessary to fail fast and learn before succeeding. Break things down and provide just enough details to guide the direction but not limit autonomy or spontaneity.
3. Use transparency in decision-making.
Managers don’t always use transparent decision-making, treating information as a “need-to-know” commodity. Although there are situations where this is true, parceling out details can limit understanding and lead to less effective decisions. With the exception of certain legal data privacy obligations, you should provide access to necessary business information. Doing so allows your company to leverage the collective intelligence and collaboration of the team. It can also eliminate the “ego” often built as people rise in rank.
As far as decisions go, a self-managed team structure allows all employees to provide input—with a caveat or two, of course. If a decision will impact certain groups, you should encourage team decision makers to seek advice from those groups. Additionally, input from finance will be necessary if significant out-of-pocket costs are involved. Again, this goes back to the idea of collective intelligence. Recommendations from a variety of perspectives can bring to light solutions not otherwise possible and help avoid blind spots that can put your company at risk.
4. Resist ‘pretend’ harmony.
Only when team members have reflected on their self-value will they have the confidence and strength to thrive in a self-managed team structure. However, it’s not easy to prioritize self-management. You need to move away from the idea of harmony and lean into the tensions that inevitably develop in the workplace. Otherwise, positivity will become an illusion that fractures when obstacles grow. For example, consider Zappos. The company adopted holacracy, a type of self-management model, but failed to address big challenges related to culture.
So, create safe spaces and discuss what’s going on within your team. Encourage people to actively listen, try to understand the points of view of other parties, and take ownership of their verbal and nonverbal communication. Don’t shy away from conflict. Instead, meet it head-on without assigning blame or debating right versus wrong. Use the situation to help team members grow as individuals. If need be, you can act as or involve a mediator in the discussion to help individuals arrive at a solution.
Transitioning to self-management.
In the past, you likely controlled budgets, goal achievements, timesheets and more. All of this will still be important in the self-managed future, but every worker will do this for themselves or as a team. For example, at our company, we don’t do central time bookings. Everyone ensures they don’t work too much or too little according to employment laws and their individual capacities. In self-managed organizations, everyone is a manager, so your role will change over time.
Luckily, there are many individual and company benefits to this structure. As you help foster self-management in the workplace, the self-responsibility that comes with it can lead to greater employee retention due to higher job satisfaction. Self-management also encourages innovation, creates a resource fluidity that improves operations and allows team members to more nimbly react to the ever-changing marketplace. As a manager at a self-managed organization, you’ll reap the benefits of continuous team and business success.
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