The foundations of running a company are evolving. Much of the operations of technology companies inherited ideas from very old fashioned concepts. For example, in old companies you had managers and workers. You paid the workers with the expectation that they would produce a given amount of output per hour. This was measurable. The managers would define what the workers should do, and the workers would simply comply. The compliance model (also known as the dictatorship model) works well in factories and places where manual labor is the main concern. However, in a modern technology company, this model is completely wrong.
Modern day tasks require higher-level processing. Creative ideas need to flow. The complexities of successful coordination and communication are paramount. The difference in output of a motivated individual and a unmotivated individual is far greater than with manual labor. Team work and the dynamic processing and problem-solving of a continuous flow of unexpected problems is critical. There is no script. In a technology company, the horses become the drivers. They are coming up with the solutions to the problem. The successful implementation of one idea requires several other ideas to be constructed. Management only gets in the way. The role of management is to facilitate and provide any assistance for maximum self-directed output of the workers. Telling them what to do makes no sense, as it is the workers job to figure out what needs to be done.
This modern day self-directed model breaks a lot of ancient corporate rules. In the old days, workers were typically paid very little. They had almost no stake or share. They did not need to be creative. They only needed to follow instructions and do the work they were told to do. The real value was created at the management level. Therefore, management had all the power and all the money. But in a technology company, it is often the technical minds of the development staff that creates the real value. In the world of startups, ideas are a dime a dozen. Many founders protect their ideas with an NDA and work in “stealth-mode” to prevent other people from stealing their idea. In reality, you could share your idea with everyone you know, and nobody will take the time to implement it no matter how good it may seem. It would be a huge effort and most people are cynical and skeptical anyways. The idea isn’t as valuable as some might think it is. And if management is coming up with the ideas, which have little value, why are they paid the most?
In the modern technology company, management is to some degree, the slave. They may be the ones providing funding and salary. They keep you alive, and in exchange, you work. Their role becomes that of purely support. Obviously they still exhibit control as they can withdraw their funds and stop paying you if they believe that you are not producing anything. But things have changed and continue to change. No longer do you really need millions of dollars to build your idea. If you’re a web application start-up, you can purchase pay-as-you-grow cloud-based hosting and scale as your business grows. All you need is a computer and a place to write your code. So even the funding provided by management is of little need.
But that isn’t to say management is useless. Management is a form of government. A sort of necessary evil when you have more than one person in a company. There is the coordination of different people. There are human resources related issues. Sick days. Shares and options. Legal issues. There needs to be coordination between the sales team and the engineering team and the marketing team. As the company grows, this effort becomes increasingly complex.
Furthermore, management can provide important business connections. A resourceful management team can help find suitable partners for the company, making critical connections and introducing valuable people to the company family. These soft-skills can be just as important as many of the technical and engineering aspects of the company.
But really, most of these “services” offered by management can be selectively found in certain specialists. If you need funding, you should seek a venture capitalist. If you need connections, you might want to hire someone who has connections. If you need human resource coordination, you might want to hire someone who can handle such issues. And if all these specialists can work autonomously to the maximum of their capabilities, then there is very little need for management.
But there are a few reasons people resort to management (or government). Eventually there can be problems that can’t be resolved by the individual people. One person says they should do X, the other person says they should do Y. And rather than resolving it, they resort to asking a “higher-level decision maker” – the manager. The manager then takes the role of decision maker. And then there are political issues. You might have a team member who has a problem with another member that can’t be addressed directly. A manager can help act as a middle-man between the situation with confidentiality.
And there is the on-going question of how to deal with workers who are riding on the backs of the others. Anytime you have a team who is evaluated by the output of the group rather than the individual, you can have some members degrade into doing the least amount of work. People can be lazy and that is undeniable. Especially if they don’t feel like they have a responsibility to the team. This is what people usually mean by team work. Everyone should be giving a fair amount of effort. And this is not easy to measure, because really it’s the perception of fair effort that is more important than actual effort. Some people might feel that they are providing more value in their vast experience and knowledge, while others think they are being lazy and not doing the actual coding work. A manager can step in and evaluate to make sure that the company communism is working effectively and everyone is contributing equally.
And this is a difficult problem to solve. Even if you gave all workers the same amount of % share or stake in the company, it’s always easy to not put in a fair share amount of work. So the work must be divided and agreed upon, signed and stamped by legal language. But this type of measured group dictatorship is the start of a poor relationship. It is the prenuptial problem. If you have two people who are already planning on protecting themselves, how can you expect them to stick together?
This truly is a human problem. The only known solution that can compete in the modern competitive technology space is building teams where the relationship is not unlike marriage. There is an underlying spirit that connects the team. And spirit is hard to measure or predict. Spirit is not something that engineers or lawyers like to talk about. It has connections to the religious and voodoo. But marriage is a religious institution. In order for people to work together, they have to believe in illogical things. It’s a blind faith in many respects, because logically it really doesn’t make any sense. And if you look at the team from a logical perspective, it will never make sense. Someone is getting screwed, and if you’re focused on who that is, the team will spiral into disconnect. In fact, the only way it can work is if people are a bit dumb and act in very counter-intuitive ways.
So what is management? It’s a evil that is created when people lose spirit. When people are no longer able to resolve their conflicts on their own, the size of management grows. When we lose spirit, we turn to lawyers. And this destroys any creative effort, any team work, and the company is doomed. When we lost spirit, we lose the ability to lead ourselves to success.
When building a modern company, you must nip the loss of spirit in the bud because that’s the beginning of the end. If you have anyone who thinks something is unfair, you begin a chain of blaming and selfishness that permeates and spreads like a virus. You can try to mitigate the loss of spirit by simply gathering the most honest feedback possible about the conditions of their work and how strongly they feel about the team’s effort and fairness. Do they feel encouraged to contribute as much as they can? How excited are they about their work? It’s a very human thing. Look at any successful sports team. Sure, they might have their share of stars, but time and time again it’s the team that works together as a team that succeeds.
Conflicts are a natural part of the process of solving problems. It is the ability of individuals to resolve these conflicts that define the success of the team. This usually happens when they believe in something greater than themselves. We know that nothing binds a team together like a common foe. We also know that like-minded people will have fewer conflicts to begin with. Also, flexible-minded people who are not fixed on doing things a certain way (arrogance coupled with stubbornness) can help. People who are open-minded and willing to learn is critical to resolving such conflicts. People who are willing to change and people who are willing to consider other points of view. These are personality issues that revolve around psychology and behavior.
A modern company understands these human elements and makes it a priority above everything else. Because if you don’t have people who are motivated to contribute, what do you have? Nothing.
It’s the human spirit that breeds success in companies, sports teams, society and in government.