Are Managers An Endangered Species?
If team are self-directing, why do we need managers?
Curtis "Ovid" Poe
http://allaroun...
The Elephant in the Room
• The “unsolved problem” in Agile
• Traditional management doesn’t work
• This problem is often i...
Hunter-Gatherers
• Follow the leader
• … or die
• Tend to be more egalitarian
• Tend to be more communal
April 3, 2014 Cop...
Feudalism Oversimplified
• Local allegiances
• Poor internal communication
– No price signals
– Thus no markets (in the mo...
The Feudal Era
April 3, 2014 Copyright 2014, All Around The World
The Corporate Era
April 3, 2014 Copyright 2014, All Around The World
Wait, what?
April 3, 2014 Copyright 2014, All Around The World
Startup
April 3, 2014 Copyright 2014, All Around The World
Growth
April 3, 2014 Copyright 2014, All Around The World
Mature
April 3, 2014 Copyright 2014, All Around The World
Senile
April 3, 2014 Copyright 2014, All Around The World
Progressive
April 3, 2014 Copyright 2014, All Around The World
Why Do Corporations Struggle?
• Why don't big companies innovate more? (Forbes)
• Why big companies can't innovate. (Harva...
Public Companies
• Share prices tied to compensation
• Share prices tied to job security
• Share prices vis-à-vis company ...
Share Prices
Keeping share prices high
requires minimizing risk
April 3, 2014 Copyright 2014, All Around The World
Share Prices
Minimizing risk
means
minimizing innovation
April 3, 2014 Copyright 2014, All Around The World
Inefficiencies
• Feudal societies were inefficient
– Local allegiances
– Poor internal communication
• No price signals
• ...
Inefficiencies
• Corporations are inefficient
– Local allegiances
– Poor internal communication
• No price signals
• Thus ...
April 3, 2014 Copyright 2014, All Around The World
If we are willing to die for Democracy and Capitalism
… why do we forbi...
People (a.k.a. “resources”)
• Little personal incentive
• Groupthink
• Risk averse/hide-and-seek
• Blame avoidance
• Large...
Why Do Feudal Corporations Exist?
April 3, 2014 Copyright 2014, All Around The World
Why Do Feudal Corporations Exist?
• Brand recognition
• Mature products
• Financial reserves
April 3, 2014 Copyright 2014,...
How Do Large Corporations Cope?
• BBC Blue Room
• Funding startups
• Litigation instead of innovation (“Hello, RIAA”)
• Go...
Existing Agile Corporations
April 3, 2014 Copyright 2014, All Around The World
37signals
• Basecamp, Highrise, Campfire, Rails
• 38 employees
• Self-organizing teams
• Reluctantly trying “middle manage...
Github
• Github!
• 200+ employees
• Self-organizing teams
• Reluctantly trying “middle manager” role
April 3, 2014 Copyrig...
Priceline
(profits courtesy Booking.com)
April 3, 2014 Copyright 2014, All Around The World
Booking.com
Copyright 2014, All Around The World
Goal Sell more hotel rooms
Strategy An Agile company
Tactics P.O.P. (ish)...
Booking.com
• Third largest e-commerce site in the world
• 200+ IT staff
• Thousands of employees
• No project managers
Ap...
Priceline Record Growth
April 3, 2014 Copyright 2014, All Around The World
Booking.com Strengths
• Relatively flat hierarchy
• Excellent customer service
• A/B testing experts
• Strong continuous d...
Booking.com Challenges
• Extensive technical debt
• Lack of Perl developers
• Dutch tax law changes
• Poor US market penet...
April 3, 2014 Copyright 2014, All Around The World
VALVE
• Half-Life Series
• Counter-Strike Series
• Team Fortress Series
• Portal Series
• Left 4 Dead Series
• Steam
April...
VALVE
• 250+ people
• Better profits/employee than Google or Apple
• The platonic ideal of Agile?
• What are corporations ...
VALVE
• Entirely self-funded
• Own their intellectual property
• “Hiring well is the most important thing in the
universe....
VALVE
• No managers
• None
• Really
April 3, 2014 Copyright 2014, All Around The World
VALVE
• No job titles, either (except on business cards)
• Everybody is an expert
• 100% Time
• All desks have wheels
• Ev...
VALVE Struggles
• “Valve Time”
• Mentoring
• Disseminating information internally
• Long-term predictions
• High barrier t...
VALVE (Alleged) Struggles
• Not always as flat as they appear
• Excess cash can kill incentives
• Windows lock-in
April 3,...
April 3, 2014 Copyright 2014, All Around The World
Ricardo Semler
April 3, 2014 Copyright 2014, All Around The World
•http://en.wikipedia.org/wiki/Ricardo_semler
•http://www...
Other “Managerless” Comapanies
• Morningstar, Inc.
• Gore-Tex ®
• Zappos.com
• Medium.com
• … and many more
April 3, 2014 ...
Process Versus Product
• Products over process
• Managers are often “Process”
• Hence, minimizing management
April 3, 2014...
Managerless companies
• Generally agile/lean
• Usually tech companies
• Almost always privately funded
April 3, 2014 Copyr...
Open Questions
• Can “managerless” succeed long-term?
• What social changes might this entail?
• Where are managers requir...
Summary
• Corporate management resembles feudalism
• Agile teams are self-directing
• Many companies are eliminating manag...
Questions?
?
http://www.allaroundtheworld.fr/
April 3, 2014 Copyright 2014, All Around The World
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Are Managers An Endangered Species?

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It's long been noticed that public companies tend to be less innovative. There's also a trend in many Agile companies to eschew management. Are private, Agile companies without managers the future?

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  • Though generally more egalitarian than today’s societies
  • Local allegiance. No price signals.
  • You can leave the company. Room for advancement. Incentives and motivations are different.(Watch Office Space again)
  • You can leave the company. Room for advancement. Incentives and motivations are different.
  • You can leave the company. Room for advancement. Incentives and motivations are different.
  • You can leave the company. Room for advancement. Incentives and motivations are different.
  • You can leave the company. Room for advancement. Incentives and motivations are different.
  • I tiny team dedicated to innovation, while the rest of the company remains static
  • Dark side of analyst coverage: study demonstrating the more financial analysts cover your company, the less innovative you are
  • Obviously, private companies have more freedom (ValvE)
  • Large companies often do large projects which means that blame avoidance is a critical strategy to keep your job (tied to ignoring sunk costs)http://www.ft.com/cms/s/0/863409bc-5fca-11e0-a718-00144feab49a.htmlHide-and-seek is easier when the management graph is complex
  • Oracle atRentrak
  • Some corps fund start-up "incubators" to tap into startup innovationsIf you can’t stop your competitors, crush them.
  • Kawasaki: “Beat Yamaha”. Kennedy: “Go to the moon”.How many people can succinctly describe cPanel’s mission statement?
  • Much
  • Much of this is unsubstantiated research
  • Are Managers An Endangered Species?

    1. 1. Are Managers An Endangered Species? If team are self-directing, why do we need managers? Curtis "Ovid" Poe http://allaroundtheworld.fr/ Copyright 2014, All Around The WorldApril 3, 2014
    2. 2. The Elephant in the Room • The “unsolved problem” in Agile • Traditional management doesn’t work • This problem is often ignored • So … history April 3, 2014 Copyright 2014, All Around The World http://www.flickr.com/photos/hbarrison/7522705738/
    3. 3. Hunter-Gatherers • Follow the leader • … or die • Tend to be more egalitarian • Tend to be more communal April 3, 2014 Copyright 2014, All Around The World
    4. 4. Feudalism Oversimplified • Local allegiances • Poor internal communication – No price signals – Thus no markets (in the modern sense) • Command-and-control from king to serf April 3, 2014 Copyright 2014, All Around The World
    5. 5. The Feudal Era April 3, 2014 Copyright 2014, All Around The World
    6. 6. The Corporate Era April 3, 2014 Copyright 2014, All Around The World
    7. 7. Wait, what? April 3, 2014 Copyright 2014, All Around The World
    8. 8. Startup April 3, 2014 Copyright 2014, All Around The World
    9. 9. Growth April 3, 2014 Copyright 2014, All Around The World
    10. 10. Mature April 3, 2014 Copyright 2014, All Around The World
    11. 11. Senile April 3, 2014 Copyright 2014, All Around The World
    12. 12. Progressive April 3, 2014 Copyright 2014, All Around The World
    13. 13. Why Do Corporations Struggle? • Why don't big companies innovate more? (Forbes) • Why big companies can't innovate. (Harvard Business Review) • Why is innovation so hard for large companies? (Game Changer) • Why small companies have the innovation advantage. (entrepreneur.com) • The Dark Side of Analyst Coverage: The Case of Innovation. (Journal of Financial Economics) April 3, 2014 Copyright 2014, All Around The World
    14. 14. Public Companies • Share prices tied to compensation • Share prices tied to job security • Share prices vis-à-vis company takeover • Share prices as a measure of success April 3, 2014 Copyright 2014, All Around The World
    15. 15. Share Prices Keeping share prices high requires minimizing risk April 3, 2014 Copyright 2014, All Around The World
    16. 16. Share Prices Minimizing risk means minimizing innovation April 3, 2014 Copyright 2014, All Around The World
    17. 17. Inefficiencies • Feudal societies were inefficient – Local allegiances – Poor internal communication • No price signals • Thus no internal markets (in the modern sense) – Command-and-control from king to serf April 3, 2014 Copyright 2014, All Around The World
    18. 18. Inefficiencies • Corporations are inefficient – Local allegiances – Poor internal communication • No price signals • Thus no internal markets (in the modern sense) – Command-and-control from CEO to grunt April 3, 2014 Copyright 2014, All Around The World
    19. 19. April 3, 2014 Copyright 2014, All Around The World If we are willing to die for Democracy and Capitalism … why do we forbid it in our corporations?
    20. 20. People (a.k.a. “resources”) • Little personal incentive • Groupthink • Risk averse/hide-and-seek • Blame avoidance • Large projects bring prestige April 3, 2014 Copyright 2014, All Around The World
    21. 21. Why Do Feudal Corporations Exist? April 3, 2014 Copyright 2014, All Around The World
    22. 22. Why Do Feudal Corporations Exist? • Brand recognition • Mature products • Financial reserves April 3, 2014 Copyright 2014, All Around The World
    23. 23. How Do Large Corporations Cope? • BBC Blue Room • Funding startups • Litigation instead of innovation (“Hello, RIAA”) • Going Agile April 3, 2014 Copyright 2014, All Around The World
    24. 24. Existing Agile Corporations April 3, 2014 Copyright 2014, All Around The World
    25. 25. 37signals • Basecamp, Highrise, Campfire, Rails • 38 employees • Self-organizing teams • Reluctantly trying “middle manager” role April 3, 2014 Copyright 2014, All Around The World
    26. 26. Github • Github! • 200+ employees • Self-organizing teams • Reluctantly trying “middle manager” role April 3, 2014 Copyright 2014, All Around The World
    27. 27. Priceline (profits courtesy Booking.com) April 3, 2014 Copyright 2014, All Around The World
    28. 28. Booking.com Copyright 2014, All Around The World Goal Sell more hotel rooms Strategy An Agile company Tactics P.O.P. (ish) April 3, 2014
    29. 29. Booking.com • Third largest e-commerce site in the world • 200+ IT staff • Thousands of employees • No project managers April 3, 2014 Copyright 2014, All Around The World
    30. 30. Priceline Record Growth April 3, 2014 Copyright 2014, All Around The World
    31. 31. Booking.com Strengths • Relatively flat hierarchy • Excellent customer service • A/B testing experts • Strong continuous deployment • Focus on customers, not code April 3, 2014 Copyright 2014, All Around The World
    32. 32. Booking.com Challenges • Extensive technical debt • Lack of Perl developers • Dutch tax law changes • Poor US market penetration (*) • Focus on small projects April 3, 2014 Copyright 2014, All Around The World
    33. 33. April 3, 2014 Copyright 2014, All Around The World
    34. 34. VALVE • Half-Life Series • Counter-Strike Series • Team Fortress Series • Portal Series • Left 4 Dead Series • Steam April 3, 2014 Copyright 2014, All Around The World
    35. 35. VALVE • 250+ people • Better profits/employee than Google or Apple • The platonic ideal of Agile? • What are corporations for? April 3, 2014 Copyright 2014, All Around The World
    36. 36. VALVE • Entirely self-funded • Own their intellectual property • “Hiring well is the most important thing in the universe. Nothing else comes close.” April 3, 2014 Copyright 2014, All Around The World
    37. 37. VALVE • No managers • None • Really April 3, 2014 Copyright 2014, All Around The World
    38. 38. VALVE • No job titles, either (except on business cards) • Everybody is an expert • 100% Time • All desks have wheels • Evaluation by your peers April 3, 2014 Copyright 2014, All Around The World
    39. 39. VALVE Struggles • “Valve Time” • Mentoring • Disseminating information internally • Long-term predictions • High barrier to entry April 3, 2014 Copyright 2014, All Around The World
    40. 40. VALVE (Alleged) Struggles • Not always as flat as they appear • Excess cash can kill incentives • Windows lock-in April 3, 2014 Copyright 2014, All Around The World
    41. 41. April 3, 2014 Copyright 2014, All Around The World
    42. 42. Ricardo Semler April 3, 2014 Copyright 2014, All Around The World •http://en.wikipedia.org/wiki/Ricardo_semler •http://www.semco.com.br/en/ • 27% average annual growth for 25 years •http://www.slideshare.net/camilletaper/semco • "Leading by Omission" speech (Google it)
    43. 43. Other “Managerless” Comapanies • Morningstar, Inc. • Gore-Tex ® • Zappos.com • Medium.com • … and many more April 3, 2014 Copyright 2014, All Around The World
    44. 44. Process Versus Product • Products over process • Managers are often “Process” • Hence, minimizing management April 3, 2014 Copyright 2014, All Around The World
    45. 45. Managerless companies • Generally agile/lean • Usually tech companies • Almost always privately funded April 3, 2014 Copyright 2014, All Around The World
    46. 46. Open Questions • Can “managerless” succeed long-term? • What social changes might this entail? • Where are managers required? • Can public companies effectively compete? April 3, 2014 Copyright 2014, All Around The World
    47. 47. Summary • Corporate management resembles feudalism • Agile teams are self-directing • Many companies are eliminating management April 3, 2014 Copyright 2014, All Around The World
    48. 48. Questions? ? http://www.allaroundtheworld.fr/ April 3, 2014 Copyright 2014, All Around The World

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