Dynamic Leadership
I have been a recent student of “Dynamic Governance” (DG). This concept was introduced to me via the national chapter of the US Green Building Council. Most of my clients know I am a founding board member of the Colorado Chapter. Developed in the Netherlands as "Sociocracy" in the 1980s, DG enhances productivity through a system of decision-making and self governance that facilitates feedback and allows the rapid ability to change. The USGBC adopted DG to manage the working relationships between the national org and its chapters. When we started the chapters we felt isolated. Chapters were new to national, and we felt like we were reinventing the wheel. DG has made a huge difference in how we communicate. I appreciate and enjoy the training I have received and am working toward certification.
Nonprofits are very challenging to lead and wonderful training for anyone you are grooming for management. It will teach them to manage without the usual threats, and with few incentives. You also are working with your peers, or if it’s a children’s group—you are not only managing the children but their parents. You have lost the traditional sticks and don’t have a lot of carrots. To motive and enlist the willing cooperation of volunteers, you have to praise and recognize each achievement. The buy in is critical and everyone, wants their carrots.
Dynamic Governance is the perfect way to organize a nonprofit and any forward thinking organization. The equivalence in decision making creates immediate buy in with feelings of identity. It inspires creativity and a sharing of ideas. Leaders find they are better informed and able to lead easier. In DG, a decision is made by consent decisions instead of consensus, vs traditional winner/loser roles. A proposal is put on the table, and, rather than focusing on whether they are completely "for" the proposal, individuals react quickly, indicating whether it falls within their range of tolerance for achieving the group aim.
Decisions are made by both the hierarchical layers involved and feedback on implementation of the decision gets back to the top. The double linking principle means that an organization becomes more responsible and can quickly adapt. It also engages all the intelligence within a group to evaluate a problem or opportunity.
In the Netherlands any company with more than 50 employees, by law, must have work groups—a group resembling our unions. Companies using DG are excluded from this law. Imagine suggesting the UAW that they can be represented to management without the need for unions? In Holland instead of the knee jerk US reaction of “I’m giving up my power!!, it has been proven over and over that leaders are more, not less empowered. It shows the lack of trust created in traditional management hierarchy.
DG creates not a top down management style, but functional units called circles. The circle exists as an individual unit in relation to other circles. Each semi autonomous circle has its own aim, given by the higher-level circle, and has the authority and responsibility to execute, measure, and control its own processes to move towards its aim. It is connected to the circle above in the form of a double link. This means that at least two people from one circle take part in the decision making in the next higher circle. One of those two is the person charged with accountability of the expected results, the other elected by the group. In traditional management, the hierarchy creates the policy and the workers implement. Those implementing the policies don't always have input into the decisions, and feedback on implementation doesn't always get conveyed back to management. Both positive and negative information is continuously fed back through the system so that incremental adjustments can be made. This makes dynamic governance appealing in today's rapidly evolving environment, where business decisions and adaptations need to be made and executed quickly in order to stay competitive.
In DG classes the example of riding a bicycle is often given. You think you are moving forward in a straight line, but in reality you are constantly checking and balancing. If you were to ride that bike eyes closed, you would crash quickly. Traditional management without important feedback rides often, eyes closed.
An employee’s behavior in general is a function of what he knows and believes. Employees need the KSA’s (knowledge, skills and attitudes) or they cannot perform. However, no matter how knowledgeable you are, if you aren’t motivated to perform the activity you won’t. Traditional punishments, actually motivates you NOT to do it. Threats “do it or leave” result in the top performers leaving for a position that will be respectful of their talents. The employees that are marginal, fearful they may not find another job, stay. To the children of the Great Depression, having a job was a matter of survival. This is no longer the case.
You have seen the results of surveys of why people stay at their jobs—the most recent survey I saw asked for interesting work, appreciation and feeling like they were “in” on things above “good pay”. Employees work to satisfy their needs, and understanding the type of needs is important to motivation.
We too quickly regard workers as focused on outcome. Consider a story about Volkswagen in 1992. The carmaker was negotiating a new labor agreement in Mexico. The company signed with the union a generous 20% pay increase for workers. VW thought everyone would be happy. But the union leaders did a poor job of involving the employees and didn’t communicate some changes of work rules. Workers did not understand the basis for the decisions and felt betrayed. The employees walked out, costing VW $10Mil a day. Violence began and the government had to intervene to restore peace.
Contrast this to an event in the 70’s at Endenburg Electrotechniek (EE), the company where DG was formed. Almost half of their staff worked in Dutch shipyards installing the electrical wiring for big ships. Heavy competition came from the Japanese and the shipyards closed their doors. The EE top circle decided it had no choice but to lay off the shipyard staff.
Within a few hours of the announcement, a member of a team circle had an idea and called an emergency meeting of his circle. He was not a person slated for lay off. He suggested the company could avoid a layoff by training the shipyard workers to become salespeople. The circle liked the idea, added details and elected him as their circle’s representative to the EE top circle. He was then empowered to call a second emergency meeting to the top circle. He presented his idea, and within a few weeks the workers, new marketers, brought in a number of small diversified jobs resulting in only a few staff layoffs.
This is an example of a company pulling together vs traditional me vs them thinking. In the US a proposed layoff has workers thinking “whew, glad its not me”, without inspiration to look for another solution. Stand beside any water cooler—the conversation is almost always, “they never listen”. When a new sales person is hired rarely is the sentiment “great we need the help!” They are more likely to be seen as a competitor. When an aggressive sales goal needs to be attained, companies often put in a sales contest. Having a winner means the rest are losers.
Does DG work in the private sector? Ternary Software claims to be the first for profit entities to enlist it. Their CEO, Brian Robertson, has adapted the process and calls it Holacracy™. In reading from his site, the only difference I see is the name. Their basic premise is still to give voice throughout the organization.
There are 4 basic premises of DG.
Decision Making by Consent: Decisions are made based on discussion till no one present has a paramount objection to the proposal presented.
Circle Organization: The organization is built of semi-autonomous circles. Each circle has its own aim, given by the higher-level circle, and has the authority and responsibility to execute, measure, and control its own processes to move towards its aim.
Double-Linking: A lower circle is always linked to the circle above it via at least two people who belong to and take part in the decision making of both circles.
Elections by Consent: People are elected to key roles exclusively by consent after open discussion.
DG assumes that often there is no “best” candidate or solution to a problem. Managing by consent means we are not seeking perfection because there is rarely a perfect candidate or decision. Decisions are not made in a democracy “majority rules” or consensus—of unanimous agreement. These processes can be used, providing the group consents to using this method on this occasion.
The top circle can get out of the details confident the circles below are fully empowered and feedback is established. Managers do not give up their power, just the time draining micromanaging. Their job gets easier and time is freed to develop other strategies and aims.
