This note is about companies in general. Related to company vision, branding and growing a startup into a company.

Companies frequently aim to maximize productivity-per-dollar. This should not be the primary reason or company vision, but in the end, money is the only thing that keeps companies alive. Generating revenue is air to company's lungs and blood in its veins. Revenues are used to sustain the company and provider profit for the stakeholders.

Productivity of a company is the sum of the productivity of its employees. Poorly formed teams reduce member performance e.g. because of conflicts. Good teams boost member performance e.g. with clear role division. More about teamwork in teamwork notes.

Productivity is measured in the long term. Forcing underpaid employees to work for longer days until they burn out is a suboptimal strategy in the long run. Company productivity dips close to zero when you are required to get new employees, especially in creative work. Keep the work motivation high.

Motivated people are productive people. Motivated teams are the most productive and require least amount of monitoring. There is a separate note about motivating employees, but the most important motivator for a person is working in a company with similar beliefs.

Organization Color

All human organizations have a palette of colors that define where the motivation to act comes from.

Human organizations have transformed through ages:

  Red    > Amber       > Orange    > Green    > Teal
  (fear) > (hierarchy) > (profits) > (family) > (organic)

Organization color doesn't just apply to companies. Even a small team of three will benefit by clearly communicating how the group works.

Red organization:

• Red organizations are like mafia or street gags; loyalty by fear.
• They must have a strong leader.
• Weak serve the strong so the strong take care of the weak.
• Breakthroughs:
  • division of labor
  • top-down authority

Amber organizations:

• Amber organizations are like the army, religious institutions and government.
• Stable organization chart with job titles and roles.
• Breakthroughs:
  • reproducible and predictable processes
  • roles and departments

Orange organizations:

• Orange organizations are like listed corporations, insurance firms and banks.
• Organizations are seen as machines; inputs-outputs, ROI, effectiveness.
• Humans are seen as resources, actions are timed, working hours are clocked.
• Breakthroughs:
  • accountability; reach goal any means you see fit
  • improved innovation; new approaches should be tried
  • allows climbing the ladder; the smartest lead the pack

Green organizations:

• Green organizations are like families; common in academia, nonprofits and social workers.
• A lot of companies try to assure this is them but rarely they are; Ben & Jerry's actually is
• Breakthroughs:
  • empowerment; pushing decisions down to the lowest level
  • value-driven culture; getting company culture right is the most important part, but also extremely hard to keep together when the organization grows
  • reduce stakeholder value; company doesn't just have obligations to maximize the profits but also to employees, customers and environment

Teal organizations:

• Teal organizations are like living systems.
• Teams see every month to see how they compare with others in terms of productive hours You can hide from your boss, not from colleagues.
• Breakthroughs:
  • taming the ego; listen to your inner voices but don't be controlled by them
  • external incentives to internal ones; does this decision feel right, am I being true to myself?
  • wholeness; drop the mask, bring yourself to work
  • no one is equal; allow everyone to grow to be better version of themselves

No organization is 100% of one color. But you should be able to recognize the palette of any organization.

Compensations:
- Red: sharing the spoils as the leader pleases
- Amber: same work, same pay
- Orange: individual bonuses
- Green: team bonuses
- Teal: share abundant profits with the whole company

Decision-making:
- Red/Amber/Orange: top-down, authority has the final say
- Green: consensus, everybody must agree, takes ages to convince everyone
- Green: vote, majority rule, fails miserably if non-experts vote
- Teal: get perspectives from colleagues, and make the best decision by yourself
        Any person who feels strongly about an issue or a possibility has
        the power to do something about it if they understand the system.
        The bigger the decision, more people you should to ask for advice.

Ringer: Ring a bell when discussion comes from ego or turn unsafe, no one is allowed to speak until the bells stops ringing so everybody has time to reflect on the situation.

Chosen:

1. one person is chosen
2. one minute of silence, then each person says the following
3. "What is the one thing I most value about working with you?"
4. "What is one area where I sense you could change and grow?"
5. everything is noted down and given to you to reflect later

Sources

• Reinventing Organizations, Frederic Laloux