Conventional wisdom says that when it comes to managing a company, we need organisations to be highly ordered, with a strong and well-defined structure, plus rules and regulations, lead by a strong boss. But what if that's wrong? What if a bosslessness and self-organizstion give rise to an effective order far more potent than what any one individual might impose?
Take the case of the French company FAVI, a small 50-year-old designer and manufacturer of copper alloy automotive components. FAVI employs nearly 600 people but has gone without a personnel department for nearly 30 years. It was one of the first things CEO Jean-François Zobrist removed when he took the helm in 1983. But as I found out from Zobrist, that wasn't all he eliminated.
There aren't many CEOs who will say, "I am a stupid and lazy manager," much less do so in the first conversation with a writer. This was Zobrist's way of explaining why he puts the company in the hands of the people doing the work.
"I have no idea of what people are doing," he says.
What he means is that he does not possess the expertise to do their work, so he should therefore have no input into it. His job, as he sees it, is to "be the headlights and the windshield" of the vehicle that is FAVI, acting as the guiding light and provider of vision. FAVI is as unique as Zobrist, and different from any other factory I've ever been to — and I've been to many.
Not only does FAVI have no personnel department, it has no hierarchy anywhere. There is no middle management, no central operating committees, no time clocks or cards, and no thick employee handbooks jammed with the traditional "do this, don't do that" policies. No one at FAVI uses the words personnel, worker or employee. (And not because they're English words, either.) As far as Zobrist is concerned, most of the conventions of the modern organisation don't make much sense, and to him, centralizing operations only serves to impose "arbitrary restrictions on people's activity and swell their own ranks to police those constraints".
But it hasn't always been this way.
Turning Company Culture Upside Down
The culture at FAVI when Zobrist came on the scene was just the opposite. If you wanted a tool, for example, you had to go to the person in charge of monitoring time cards, who kept the tools under tight security and who seemed to take a rather perverse pleasure in penalising people for being late. If it was a hot summer day, you might find the windows closed as employees suffered in the unhealthy swelter of the metal foundry to earn a "heat premium" in their wages given for keeping the temperature above a certain threshold. The central planning committee spent two hours a week going over why production was yet again behind and deliveries were late, yet spent no time on the actual planning activity itself.
By the time he was given the leadership of FAVI, Zobrist had grown weary of what he terms the chaine de comment — the "chain of how." In the chaine de comment culture, he says, "everyone is stupid except the CEO. If you ask the operator, he says, 'I don't know, talk to my supervisor.' Then you go to the supervisor, and he says, 'I don't know, talk to the shop boss.' But the shop boss doesn't know. Neither does the director, who says, 'Talk to the CEO.' "
So what Zobrist did was to turn the chaine de comment culture upside down. "Now it is the CEO — me — who is stupid," he smiles, using the phrase "Il faut laisser le 'comment' à ceux qui font" — leave the how-to to those who actually do the job.
Eliminating Central Control
The way Zobrist tells it, "I came in the day after I became CEO, and gathered the people. I told them 'tomorrow when you come to work, you do not work for me or for a boss. You work for your customer. I don't pay you. They do. Every customer has its own factory now. You do what is needed for the customer.'" And with that single stroke, he eliminated the central control: personnel, product development, purchasing — all gone.
Twenty teams were formed on the spot, based on knowledge of the customer: Fiat, Volvo, Volkswagen, etc. Each team was responsible not only for the customer, but for its own human resources, purchasing, and product development.
There are only three job designations in the team: leader, compagnon — or companion — which is an operator able to perform several different jobs, and "linchpin." Every customer has a single FAVI linchpin, who oversees all aspects of the relationship. It's such a critical position that Zobrist handpicked each one.
Zobrist basically flattened FAVI and moved it from being one big plant to being 20 miniplants housed under one roof. Performance soared, because job titles and promotions became irrelevant, no longer a distraction, and all that energy was channelled into the work itself, which at FAVI is of the highest quality.
Accountability is to the customer and to the team, not a boss — FAVI people are free to experiment, innovate, and solve problems for customers. They're known for working off-shift to serve customers or to test out new procedures. Equipment, tooling, workspace and process redesign all rest in the hands of those doing the work.
FAVI people are encouraged to make decisions and take quick action to improve their daily work and respond to the needs of their customers. Control rests with the front lines, where it adds the most value. It works. Still, customers aren't always convinced. A favourite story Zobrist tells involves a customer's site inspection.
"They asked to audit our procedures," he says. "They were not pleased because we had no measurement system for tracking late orders — nothing in place, no plan, no process, no structure in case of delay. They are a customer for over 10 years, so I say, 'In that time, have we ever been late?' They say, 'No.' I say, 'Have we ever been early?' They say again, 'No.' And so I ask them why they want me to measure things that do not exist."
In the end, Zobrist did what the best designers do: add by subtracting.
This post was adapted from In Pursuit of Elegance.
Matthew E. May is author of The Laws Of Subtraction: 6 Simple Rules for Winning in the Age of Excess Everything (McGraw-Hill, October 26, 2012). You can follow him on Twitter @MatthewEMay.