To succeed in fast-changing, dynamic markets, organizations must be increasingly flexible and adaptive. Self-managing teams are a key tool in creating such organizations.
Buurtzorg was founded in late 2006 by Jos de Blok. Jos was frustrated working in a traditional home-care organization. He was convinced that the command and control style hindered the delivery of good healthcare.
He set out to prove that an alternative - based on freedom, trust and high levels of autonomy - would benefit everyone, including, most importantly, the patients. From the beginning they decided not to grow a traditional hierarchy. They chose instead to grow a network of teams. Every time a team gets to 12 nurses, they split. They do all the work required (i.e. nursing, planning, personal development, recruitment, hiring, firing, decision-making, etc.).
Buurtzorg is a home-care nursing organization that has grown from nothing to 14,000 employees in just 10 years. They beat their competition on almost any metric you choose: highest client satisfaction, highest employee satisfaction, lowest costs (67% lower than their Dutch peers), and they cure patients faster than the competition.
They have no planning, HR or marketing departments - and there’s not a single manager in the place. If there is no formal hierarchy, how are decisions made? Can anybody just make any decision? That sounds like a recipe for chaos. Yet that only rarely happens at Buurtzorg. How come?
Here we need answers to some very basic questions. What does it mean to have a self-managed team? What are their characteristics, common principles? Is any type of team suited to be self-managed? Self-management sounds complex, shall we just ignore it?
This article will explore each of these question in turn.
A self-managing team (SMT) is a group of individuals that use their diverse skills, knowledge and experience to achieve a common goal. A manager sets the overall direction of a project or task and provides the tools and training, and then the members of the team determine, plan, and manage their daily activities and duties under reduced or no supervision.
A self-managed team is responsible and accountable for all or most aspects of making a product and/or delivering a service. Therefore, it is more likely to be successful if the group is small, cross trained, and has various different job skills.
When done right, SMTs are known to be highly effective, motivated, innovative, and productive. However, many people frequently misunderstand what it is about and what it takes to make it work.
If there’s no pyramidal hierarchy, that must mean there’s no structure, right? In reality, successful self-managing organisations have very clear structures.
The tasks of management – setting direction and objectives, planning, directing, controlling, and evaluating – haven’t disappeared. They are simply no longer concentrated in the management roles. Because they are spread widely, it can be argued that there is more leadership happening in self-managed organizations despite, or rather precisely because of, the absence of fulltime managers.
Another assumption about self-managing organisations is that it means all decisions have to be made by consensus or unanimity — everyone has to decide on and agree on everything. If this were true, self-managing organisations would never get anything done and meetings would be painful and slow.
Instead, the company has a process for decision making that teams walk through in order to determine who owns the decision. Although that person is responsible for checking with all involved stakeholders, they are ultimately the one who must make a decision in order to proceed.
These organizations are anything but “flat”, a word often used for organizations with little or no hierarchy. On the contrary, the point is not to make everyone equal; it is to allow all employees to grow into the strongest, healthiest version of themselves. How high you reach depends on your talents, interests, your character, and the support you inspire from colleagues.
Newly formed teams aren’t self-managed, nor will they be for some time. Team development is evolutionary, and describing new teams as self-directed may establish unrealistic expectations.
Although a seemingly new concept, self-managed teams have been utilized in companies since the 1960s, but have seen a significant increase in popularity over the past decade or so. We see more new purpose-driven companies similar to Buurtzorg, Patagonia, and Zappos emerging every week. What’s more, we also see many larger organizations take on the challenge of reinventing themselves and reorganizing how people work within them.
How do we know the change is actually needed?
And while there are many reasons to it, we want to highlight three:
First, people find it very demotivating to work in a hierarchy, where they’re just expected to do as they’re told. Young, well-educated professionals entering the workforce today are no longer willing to sacrifice years of their career to just following orders. After all, they can afford to be picky: the market for good talent is competitive, meaning employees are no longer desperate to cling on to whatever stable job they can.
Second, the hierarchical organizations are just too slow to succees in competition with young, agile newcomers. Without the burden of a pyramid on their shoulders, they are much faster at adapting to their changing environment. If established corporations used to laugh off small startups operating from garages somewhere – well, who’s laughing now?
Third, if we take a big picture view, we rapidly see that our world desperately needs new kinds of organizations. Many of humanity’s biggest challenges today - from accelerating climate change to increasing inequality - come from our out-of-date organizations. Fortunately enough, countless organizations have already adopted the greater purpose of changing the world for the better, and they continue to evolve around this purpose.
There are countless frameworks, models, and methods that would all be useful in the context of organizational development. And while we certainly can’t claim to know all of them, we have tried and tested a fair share both ourselves and in our work with other organizations.
As different as the various concepts may seem at first glance, we’ve noticed that they do in fact share some underyling principles. We know that we can’t possibly do them real justice with mere few-sentences summaries. Nevertheless, we’re going to try something pretty ambitious: briefly summarize the key concepts that have influenced our knowledge and understanding of self-managing.
People think in narratives, in stories. That’s how we understand the world. The INVEST mnemonic is designed to make it easy to remember what effective agile user stories look like. It was created by Bill Wake, who’s a deeper thinker on software design.
Under the INVEST criteria, good user stories are:
SMART refers to a specific criteria for setting goals and project objectives. The idea is that every project goal must adhere to the SMART criteria to be effective. Therefore, when planning a project's objectives, each one should be:
There are two ways of doing things: the old waterfall method of: “First we do this, then that, then that…” that often doesn’t deliver anything, or the new way, which, with fewer people and in the less time, can deliver more stuff with higher quality at lower cost. This second approach is called “Scrum”.
Scrum embraces uncertainty and creativity. It enables teams to assess how they actually work and gives them the tools to self-organize and rapidly improve both speed and quality of work.
At its root, Scrum is based on a simple idea: whenever you start the project, why not regularly check in, see if what you’re doing is heading in the right direction, and if it’s actually what people want? And question whether there are any ways to improve how you’re doing what you’re doing, any ways of doing it better and faster, and what might be keeping you from doing that.
Even though originally intended for software development, the principles of Scrum are often used in a wide variety of other contexts, too. The end results of Scrum – the design goal, if you will – are teams that dramatically improve productivity.
Getting Things Done (GTD) is a time management and productivity system that helps you complete tasks and meet commitments in a stress-free and efficient manner.
In this method, you break down larger tasks into smaller subtasks and set specific deadlines for them. Doing a regular review ensures that you’ll keep track of all your tasks and projects, identify weaknesses in your system, and make improvements.
There are five basic steps to the Getting Things Done methodology:
Mediation is a form of alternative dispute resolution where a neutral third-party (mediator) facilitates negotiation between the parties but does not participate in the outcome of the mediation process. On a broader scale, it is a method of resolving conflict.
Regarding its technique, mediation includes:
Managing conflict refers to actively handling and resolving conflict among team members in a constructive, solution-oriented way. In contrast, conflict avoidance strategies let teams become dependent on external leadership.
Design thinking is an approach used for practical and creative problem-solving. It is based heavily on the methods and processes that designers use, but it has actually evolved from a range of different fields — including engineering, architecture, and business.
Design thinking is extremely user-centric. It focuses on humans first and foremost, seeking to understand people’s needs and come up with effective solutions to meet those needs. It is what we call a solution-based approach to problem-solving. Also, this is the opposite of problem-based thinking, which tends to fixate on obstacles and limitations.
There are four principles of Design Thinking:
In product development there’s a well-known rule that has been proven over and over again. We talked about it in an earlier article: 80 percent of value is in 20 percent of the features. It means that in anything you buy, most of the value – most of what people want – is in only a fifth of what has been built. The trick of Scrum is figuring out how you build that 20 percent first.
The questions you need to ask are: what are the items that have biggest business impact, that are most important to the customer, that can make the most money, and are the easiest to do? You have to realize that there are a whole bunch of things on the list that you will never get to, but you want to get to the things that deliver the most value with the lowest risk first.
Try to start by figuring out where the most value can be delivered for the least effort, and do that one right away. Then identify the next increment of value, and the next. This is the way to create something or deliver something with real results.
The Loop Approach presents a systematic approach to the transformation of organizations. Its toolkit of ideas and methods is designed to help even the largest organization change its bad habits, thus enabling it to adapt to the challenges of the future.
The basis of the Loop Approach is the Loop mindset, a series of principles that changes the way an organization thinks. For example, agile methods such as Scrum offer a fresh sense-and-respond tactic for accomplishing work in short sprints. Mindfulness and positive psychology help people discover their inner strengths and relate better to one another.
The Loop Approach points out a wide range of ideas on how to empower organizations to become more agile, such as:
Human organizations are constantly changing and adapting to new circumstances. In his book Reinventing Organizations, Frédéric Laloux discusses why companies around the world are getting rid of bosses, introducing flat hierarchies and pursuing purpose over profit.
Using a color-coded typology, Laloux outlines the evolution of four types of organizations over the last ten millennia and describes in detail the attributes and characteristics of a fifth and radically different emerging new organizational form.
Abraham Maslow's hierarchy of needs is one of the best-known theories of motivation. Maslow's theory states that our actions are motivated by certain physiological needs. It is often represented by a pyramid of needs, with the most basic needs at the bottom and more complex needs at the top.
Needs at the bottom of the pyramid are basic physical requirements, including the need for food, water, sleep, and warmth. Once these lower-level needs have been met, people can move on to the next level of needs, which is the need for safety and security.
As people progress up the pyramid, needs become increasingly psychological and social. Soon, the need for love, friendship, and intimacy becomes important. Further up the pyramid, the need for personal esteem and feelings of accomplishment take priority. Maslow emphasized the importance of self-actualization, which is a process of growing and developing as a person in order to achieve individual potential.
Recent research of Maslow’s theory show that the fulfillment of the needs is strongly correlated with happiness. Even more interesting, people from cultures all over the world reported that self-actualization and social needs were for them way more important than many of the basic needs.
By laying out all these key concepts next to each other, we can see some paterns of principles emerge.
You can’t just build up a team, throw in a little training, and then leave them be. It takes a little more forethought and conscious effort to shape self-managing teams.
It’s important to have the right foundations, or else the team will see failure sooner or later. So let’s take a look at some of the essential principles, characteristics if you want, of self-managing teams.
Instead of few clever brains deciding what should be done, the power to “sense” new information and make decisions is distributed throughout the organization. This means that every member of a company becomes an intelligent sensor, receiving and evaluting signals from the outside world.
Members of self-managing teams need to be able to count on each other and be interdependent at all times. This way, everyone can focus on his or her particular part of the job with some peace of mind knowing that their teammates have their back and understand each other’s place in the team’s workflow.
Autonomy and self-organization are prerequisites for a functional “sense and respond” mindset to emerge. That’s because an organization can only respond rapidly to changes on all fronts if the teams are free to self-organize and act independently without having to wait for decisions to trickle down.
Collective responsibility means each member of the team is accountable for their area of interest. They are fully immersed in retaining their role for the project and must be responsible for carrying it out. The success or failure of the project lies on their shoulders.
Purpose-orientation means that, beyond goals, strategies and visions, the organization has also defined a greater purpose that it pursues. This purpose forms a strong foundation for the organization, because all members connect with it on an emotional level. In turbulent times, a purpose grants a measure of basic stability beyond what mere goals and strategies can provide. Of course, that doesn’t mean that goals and strategies aren’t still necessary - they are. A purpose is meant to complement, not replace, these concrete, more short-term planning tools.
In traditional organizations, information is power, which is why it’s often purposely hidden: “You want to know somethnig? I know where you can find it, but first you have to do something for me.” But now, we see this mindset being replaced by one of radical transparency, where everything and anything going on in the organization is freely and openly shared.
In a network where everyone is connected to everyone, open and honest feedback becomes increasingly important both for the effectiveness of the one-on-one relationships, but also to help maintain a warm, pleasant working environment.
In the past, the distinction between leaders and employees was crystal clear, and even reinforced through things like parking spaces, big desks, and other perks. But today, these lines are fast becoming blurred, and in the organization of the future, anyone can lead – both themselves and others. This new kind of leadership arises thanks to roles: when someone has a role and the authority and expertise that go with it, that person can lead others simply by taking resposibility and making decisions.
Since each member of the team is accountable for a particular area of the project, team members should be completely confident that their partners can accomplish their given tasks. Even if all the members of the team are self-directed in the way they work, their assigned tasks are linked to one another, which means they should work in harmony.
Jumping into self-managed teams can be challenging, and you risk losing your team’s best people if the experiment falls flat. Without the proper training and structure, adapting to a self-managed team is often a more significant undertaking than many organizations realize.
In order to determine if your team is ready to manage itself, evaluate their capabilities individually and as a group. Here, we’ve put together seven signs to reveal if a team could self-manage.
Members of a self-managed team require good problem-solving skills. This ideally breaks down to good data gathering, brainstorming, project planning, analysis, teamwork, project management, collaboration, communication, and testing the effectiveness of solution created through follow-up and troubleshooting.
It's important that each member can motivate themselves to finish assignments. The ability to persevere and overcome challenges can provide confidence that your team can accomplish goals independently. A motivated employee also accepts special tasks and seeks to improve their work and personal performance.
Consider how your team works with one another under management. When the team listens, communicates and cooperates with each other without any facilitation, then they may be ready to self-manage. Choosing to integrate working styles or sharing ideas without being prompted can lead to a more cohesive team. It's also helpful to encourage group efforts so employees can share success and learn from one another.
The team members trust each other, allowing for transparency, honesty, and humility. What’s more, team members are trusted to accomplish their own tasks, allowing for autonomy and increasing productivity. They’re able to share opinions, as well as have hard conversations that can help them solve problems. Each member can also admit failure, own up to mistakes, and ask for guidance.
Each individual in the team has the confidence to make decisions on their own, even if it’s a tough one. They prioritise their work based on the company’s priorities and choose to do things that bring the most value. They’ll use tools like a performance analytics software to help them look at the big picture and then focus on completing “must do” items in order to achieve their goals.
Team members plan what they’re going to do each day and focus on the “most important” tasks first before doing the “least important’" tasks. They also avoid checking their emails constantly or making personal phone calls and texts during their most productive time of the day in order to get their work done.
There may be new roles or responsibilities when employees transition to a self-managed team. This means that they may have to develop additional skills. Consider whether each member of the team shows eagerness to learn and achieve personal growth. If you're confident your team seeks knowledge actively and ready for the challenge of learning a new role, then it may be ready to self-manage.
Not every team is ready to be self-managed. But, if you already have team members going above and beyond their specialties, a self-managed team may be a good option.
From a business perspective, there’s a growing mountain of evidence that embracing self-management can drive better business outcomes, as measured by metrics from employee satisfaction to revenue. From a personal perspective, there’s a spark that comes from following your intuition and embracing a way of doing things that just feels right.
But being part of a self-managed organization is probably not for everyone - a team does not become autonomous overnight, and even less so an organisation. And too much autonomy, too soon, can lead to organisational chaos and unsatisfied employees.
The biggest lesson by far, to us that is, is that the need for autonomy doesn’t replace the need for leadership. Human leadership. Before everything else, an employee is a human being – with feelings, with highs, and with lows. And people have a need for a strong leader who can help them achieve their goals.
But to make this work, trust is essential. In the real world trust is earned, not given. Leaders need to build up their trust by progressively giving teams more autonomy. And teams justify this trust by delivering valuable outcomes.
And this is a never-ending process, marked by learning along the way, casting old assumptions overboard and always looking for the next step to take. Of course, this approach isn’t easy; it requires a lot of work and constant rethinking. But we’re convinced it’s worth it.