[OSList] sparking innovation from bottom

Tue Nov 26 03:27:03 PST 2013

“It takes guts to be democratic and give employees more control, but the
payoff is happiness and engagement.”

http://www.bbc.com/capital/story/20131125-sparking-innovation-from-bottom

Roberto Henriquez had an intriguing idea. The 30-year-old information
technology project manager thought he and his IBM colleagues could work
more efficiently if they had an app enabling them.

Normally, he would need approval from a senior-level review board for such
an idea. But not this time.

Instead, he quickly received the blessing — and financial backing — of his
peers through a new “corporate crowdfunding” system in IBM’s internal IT
organisation.

Not every investment decision has to be made by a director or vice
president. — Francoise LeGoues

Henriquez’s idea was pitted against other proposed projects seeking funding
from employees in the IT group. Each of the more than 300 participants —
from entry-level workers to vice presidents — received $2,000 to invest
over an eight-week period*. *Then, through the crowdfunding system,
Henriquez managed to raise a total of $20,000, and after a few months of
development and testing, project managers started using his app.

The experience was empowering for Henriquez, who is based in Bratislava,
Slovakia. “I don’t feel like I work for IBM; I feel like this is my
company,” he said.

That’s music to the ears of IBM executives who hope the iFundIT project
will engage employees and spark more innovation from the bottom up.

*Getting employees engaged*

Employee engagement is a pressing issue for most companies these days. In a
study of 142 countries, Gallup found that only 13% of employees worldwide
are engaged in their work. The percentages vary widely by nation, with 30%
of workers in America saying they are engaged; 24% in Australia; 17% in the
UK; 15% in Germany; 9% in India; and just 6% in China.

One possible solution to this problem: more egalitarian workplaces where
employees feel they have more control over decisions, such as IBM’s iFundIT
program.

“Companies need to be more compatible with this democratic age of the
Internet and social media that we live in now,” said Traci Fenton, chief
executive officer of St. Louis and London-based WorldBlu, which provides
consulting services for creating “freedom-centred” workplaces.
“Organisational democracy means decentralizing power and recognising that
good ideas are everywhere in the workplace.”

Seeking employee input may slow some types of decision-making, but Fenton
believes it could speed up the execution process because workers would feel
more invested after having their say. “Of course, companies only want to do
this if they’re sure they’re going to act on a group decision,” she said.
“If they don’t follow through, they’ve done more harm than good.”

WorldBlu compiles an annual list of the world’s “most democratic
workplaces” based on such factors as being transparent and accountable,
sharing power, and giving employees meaningful choices. The biggest
obstacles to workplace democracy are executive ego and ignorance, Fenton
said.

“Some people simply don’t want to give up control; others fear what they
don’t understand,” she said.

A democratic workplace has cross-generational appeal, although IBM believes
its crowdfunding project will especially resonate with millennials, who are
used to airing their views in blogs and social media and believe they
deserve to be heard at work, too. Millennials is a term used to describe
the generation of people born between about 1980 and 2000.

 *Small workforce, big voice*

Some companies with a small workforce are going even further and giving
employees a voice in some very major decisions. When DreamHost’s founders
decided in 2011 to recruit the first CEO for the Los Angeles-based Web
hosting firm, they let employees vote on the finalists. More recently, its
165 workers voted on the company’s health benefits plan.

“We feel that by letting our employees make the decision after they know
how much different benefit packages will cost, we’re empowering them and
encouraging them to stay with the company,” said Ed Wesley, director of
organisational development and learning. “It takes guts to be democratic
and give employees more control, but the payoff is happiness and
engagement.”

Companies like DreamHost and Menlo Innovations, a software company in Ann
Arbor, Michigan, also are opening the financial books to their employees to
guide their decision-making. “Our goal is for the staff to make decisions
about where we spend money, but they need to understand the big financial
picture of the company first,” said Rich Sheridan, the CEO at Menlo, which
has about 50 full-time and temporary workers.

Already, Menlo gets 15 to 25 workers involved in assessing a job candidate
as he or she goes through interviews and tryouts. “We work in pairs so we
want to see evidence of kindergarten skills, whether they can play well
with our employees,” Sheridan said.

Of course, it’s easier to democratise small businesses than multinationals
with thousands of workers scattered around the globe. But IBM shows that
even a company with more than 430,000 employees in 170 countries can give
at least some of them more decision-making authority.

 “We need to flatten the organisation; not every investment decision has to
be made by a director or vice president,” said Francoise LeGoues, the head
of IBM’s CIOLab and creator of iFundIT. “We want collaborative innovation.
How do we ensure that young people’s ideas get attention and that someone
in Bangalore connects with someone in New York?”

Eligible projects must be related to internal information technology,
although they could also be applied to products, such as IBM’s social
software platform for businesses. “It has to be a small project,” LeGoues
said. “These won’t be large, multi-year projects like a redesign of the
entire HR system, for example.”

About 160 projects were submitted during the first two crowdfunding rounds
this year, with 20 reaching their funding target of between $10,000 and
$30,000. Funded projects included Influence of Communities from China
(search results based on influence, not popularity) and reMap from the UK
(a collaborative outlining tool to organise and share information across
teams of all sizes).

“The level of excitement and participation has surprised me,” LeGoues said.
“People have even begun running internal campaigns to try to get others to
spend money on their projects. This is really a game changer in the way
people think about what it means to be an IBMer.”
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