This week’s feature from The MIX is by Paul Green, Jr. from The Self-Management Institute at The Morning Star Company. Paul's story is one of the winners of the recent HBR/McKinsey M-Prize for Management Innovation, the Management 2.0 Challenge.
Morning Star is one of the world's leading processors of tomatoes--and one of the most progressive models of a self-managed enterprise. Four years ago, the company introduced a custom social network to support a more dynamic, transparent, and scalable approach to self-management. Today, an ever-evolving (and immediately visible) network serves as "org chart" and peer-to-peer responsiveness replaces hierarchical control.
At the heart of this peer-regulated collection of colleagues who determine their own roles and responsibilities is the "Colleague Letter of Understanding" or CLOU. Chris Rufer, Morning Star founder, came up with the idea of a document (CLOU)--a contract of sorts--between colleagues. It wouldn't be a job description, or an employment contract. Rather, it would be a tool that each colleague would use to outline his commitments to his fellow colleagues.
The brief video below shows a few clips of Rufer, during a recent interview, briefly discussing the philosophy underlying the CLOU process.
Key Lessons:
A commitment between peers is much stronger than a job description. This was an assumption we had going into the project, and is really central to our organizational philosophy, but creating a system that facilitated this as we grew was a challenge. Part of the reason for this, I think is that...
Peer-control makes for a more cohesive group of colleagues. Our philosophy is sometimes mistaken for a "lack of management". That's not the case at all. We like to look at is as management rich. We ask everyone to become effective managers of their own mission, activities and CLOU relationships. That means they have to plan, coordinate--and sometimes even, deal with difficult performance issues--directly. But building a system that facilitates that planning and coordination to some degree has provided colleagues with a basis for peer-control, and has, in a sense, made this peer-regulation a bit easier.
The Strength of Self-Management is in the relationships between colleagues. We initially set out to create a basic software to allow CLOUs to be readily available, and more dynamic--and we achieved that. But the experience really brought into very clear focus the idea that the strength of the structure really depended on the strength of the commercial relationships between colleagues. Ironically, this idea that individual commitments between colleagues makes for a stronger organization has always been central to our philosophy, but our experience here really intensified this idea--and caused us to realize that the potential for this type of platform was enormous.
Our current enhancements are really meant to further strengthen those relationships. Imagine it as a social networking application of sorts, where your CLOU Colleague's individual performance information is piped to you as it is happening, and where you provide direct, subjective feedback to colleagues within your network. The technology here is key--and is really helping us to grow without sacrificing our principles of organizing.
Read the full award winning story here.