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ОглавлениеWe have made the workplace a frustrating and joyless place where people do what they’re told and have few ways to participate in decisions or fully use their talents.
CHAPTER 2
A Miserable Workplace
COLLIN DOHERTY ARRIVED a full hour before 6 a.m., the time he had been told to report to his new job at the textile mill. “Be here on time or I will give the job to another man,” were the parting words of the assistant mill supervisor who had offered him the job. Collin had awakened extra early that morning to walk the 3 miles from his farm to the new steam-powered textile mill in the village. He had been trying since before the plant opened to get hired. He did not want to be late.
Collin was 31 years old. He and Rowena had been married for 14 years. Ten children had been born to them, although only six were still living. The drought of the previous year and the particularly harsh winter that followed had been the last straw. The family had nearly starved that winter and did not have sufficient money to buy seed and replacement animals. Surviving another winter in Wales was not assured. Collin decided to quit farming and look for work in one of the new factories built in the region.
The family had planted crops and raised sheep and goats on the 5-hectare farm for at least the six generations recorded in the family Bible. Collin knew nothing else but dawn-to-dusk work to provide food and clothing for his family, just as his father, grandfather, and great-grandfather had done before him.
The mill employed upwards of 100 workers. In addition, there were supervisors for each of the functions performed at the mill. The employees were divided into groups, each with a specialty. For example, one group prepared the wood for the steam engine, another operated the weaving machines, and still another rolled the cloth before sending it to the shipping department. The workers who maintained the steam engine and the weaving machines were paid more than the others because their jobs required the most skill. Each group of workers had a supervisor who gave instructions, set work schedules, and made sure every man and woman did his or her job in a specified manner.
Collin checked in at the plant gate and was shown to a little room off to the side, where he was met by a supervisor. “You are assigned to the clean-up crew in the weaving area,” the supervisor said. “You will be paid 1 shilling per week. Hours are 6 a.m. to 6:30 p.m. Monday through Saturday with 30 minutes off for lunch, as long as you have completed all your morning assignments. The mill will be closed Sundays and Christmas Day.” Collin was relieved that his family would have sufficient money to feed themselves. He also noted that he was expected to put in fewer hours at the mill than the average he spent working on the farm. He also looked forward to a new kind of work, although he wondered what his deceased father would have thought about his decision to leave the farm.
His supervisor showed him the tasks for which he was responsible and made it clear that Collin should look to him for guidance or assistance. Collin noticed an office overlooking the weaving department floor. He was told later that it was where the plant superintendent and the assistant superintendent worked, as well as the bookkeepers, timekeepers, payroll staff, and salesmen. In his first two years of working at the mill, he never met the plant superintendent, nor did he ever see the “big boss,” the owner of the mill who lived in a distant city and seldom visited the site.
Collin didn’t miss a day of work in his first year at the new workplace. He moved up from the cleaning crew to a position in the weaving department and became quite skilled at the task to which he was assigned. Rowena observed a different Collin, however.
“I work hard and I get paid enough to keep food on the table and clothes on our backs. Not much else matters, does it?” he replied in response to his wife’s questioning.
“You don’t seem to care about the work the way you did when you worked here on the farm,” Rowena said. “It seems like you are going through the motions. You never tell me about the problems you are struggling with and the dreams you have for the future like you did here on the farm.”
“It’s like being one of the oxen on our farm,” Collin replied. “I get fed regularly, but at work time I’m put in a yoke that doesn’t give me much freedom. I don’t have to think much about what I’m doing, let alone dream about my future.”
“Maybe it will be different if I can become a supervisor at the mill someday. Then I will be somebody. I will have some control. I bet I could improve that place if I were in a position to have some say in things.”
Collin Doherty is a character of my creation. He was born of my reading about the Industrial Revolution and is a composite of the ordinary people who pop up in the histories of the period. So while he may be fictional, he is true.
Most historians mark the Industrial Revolution as a pivotal moment in our economic and social history. The nature of work changed in fundamental ways. Until Thomas Newcomen’s invention of the first practical steam engine in 1711, most people worked the land as farmers and before that as hunters and gatherers. Large organizations of working people were mostly limited to soldiers, servants, or slaves. During the Middle Ages craft shops sprung up in the cities, but each shop typically provided work for only a small number of people. When building the great cathedrals of Europe, men banded together to work for years on a single project, an organizational structure that had some elements of the Industrial Revolution workplace. However, it was not until industrialization began that the workplace changed rapidly for millions of people like Collin Doherty.
Many of the attitudes that took hold during the Industrial Revolution linger on today, a circumstance brought to my attention by author Bob Waterman, who in our early days at AES had walked us through his Seven-S framework. “Based on what you know about the workplace and organizational arrangements of those businesses operating several hundred years ago, what were the assumptions made by the owner/managers about the workers who labored in their factories?” he asked.
I have asked that same question hundreds of times of people in my company, students in colleges and graduate schools, government employees, and leaders in many other organizations. Here is a summary of their responses:
♦ Workers are lazy. If they are not watched, they will not work diligently.
♦ Workers work primarily for money. They will do what it takes to make as much money as possible.
♦ Workers put their own interests ahead of what is best for the organization. They are selfish.
♦ Workers perform best and are most effective if they have one simple, repeatable task to accomplish.
♦ Workers are not capable of making good decisions about important matters that affect the economic performance of the company. Bosses are good at making these decisions.
♦ Workers do not want to be responsible for their actions or for decisions that affect the performance of the organization.
♦ Workers need care and protection just as children need the care of their parents.
♦ Workers should be compensated by the hour or by the number of “pieces” produced. Bosses should be paid a salary and possibly receive bonuses and stock.
♦ Workers are like interchangeable parts of machines. One “good” worker is pretty much the same as any other “good” worker.
♦ Workers need to be told what to do, when to do it, and how to do it. Bosses need to hold them accountable.
These assumptions have had a profound effect on personnel arrangements and decision-making structures in large businesses, governments, schools, and other large organizations. Specialization became the rule. Lines of authority were clear. Workers were told exactly what was expected of them. A curious arrangement of staff and line positions emerged (experts suggest that the Prussian Army was the first to use this approach, late in the 19th century). The paternalistic impulse led to the creation of “benefits” that were provided in lieu of cash (free or cut-rate housing, schooling, and medical care). Most of the systems, controls, compensation criteria, and decision-making and leadership styles that we find in organizations today can be traced to these beliefs about workers.
When I ask people whether they believe the assumptions listed above still apply to modern-day working people, especially in the Western world, almost everyone says no. Most would agree with Max De Pree, a manufacturing executive who was a pioneer in participatory management, that advanced countries are entering a period in which 80 percent of workers will make their living by brainpower.
However, based on my own observations, I suspect that many corporate leaders still hold some Industrial Revolution views. What’s more, many of the approaches and practices in modern workplaces are nearly as demeaning as those used during the Industrial Revolution. Executives are either oblivious to the similarities—or won’t admit them. These are the only plausible explanations for the relative lack of change in the structure of work in modern corporations, government agencies, and nonprofit organizations.
A newborn shark, 6 or 7 inches long, can survive in the sort of fish tank seen in homes, but its growth is seriously stunted and its body deformed. It becomes extremely aggressive and can be kept from escaping only if the tank has a heavy cover.
Have new assumptions about working people eliminated work environments that resemble this cramped aquarium—and that prevent them from reaching their potential? Obviously, much has changed. The hours are shorter. The workplace is physically more pleasant. Compensation is usually higher. Workers have more legal rights and protections.
Fundamentally, however, working conditions in large organizations today are no more exciting, rewarding, or fun than they were 250 years ago. Most working people are boxed in by job descriptions and corporate hierarchies and have little opportunity to make decisions on their own. I was struck by this lack of freedom during visits to Japan in the 1980s. Several bestselling books had been written in the previous decade analyzing and to some extent glorifying Japanese business prowess. I got a very different impression. What struck me was that work in Japan lacked passion and joy. Fun was something that happened away from the workplace. Work was work and play was play, and the two never overlapped. Japanese “salarymen” didn’t leave work as much as escape it, often during hard-drinking nights with the “boys.”
In the modern workplace, an employee’s full talents are rarely used and often go unnoticed. Damian Obiglio, who led an AES distribution company that won the award for the finest utility in Brazil several years running, tells the story of a young man who worked in a city library in Argentina for a decade. His job was to put the books that had been returned to the library back on the shelves where they belonged. Each day he faithfully put in his eight hours and left the library immediately. He showed no interest in taking on greater responsibilities at the library, and none of his colleagues ever engaged him in conversation about his interests or hopes for the future. He caused no problems. He did his job as instructed, nothing more, nothing less. One day the national paper in Argentina ran a story celebrating the person who had won a contest for his design of a gas-powered model airplane. It turned out that the young man in the library was one of the most brilliant aeronautical designers in the entire country.
Why do so many people work so hard so they can escape to Disneyland? Why are video games more popular than work? Why is driving an automobile more exciting and enjoyable to many people than their work? Why do rank-and-file employees generally spend less time at work than top executives? Why do many workers spend years dreaming about and planning for retirement? The reason is simple and dispiriting. We have made the workplace a frustrating and joyless place where people do what they’re told and have few ways to participate in decisions or fully use their talents. As a result, they naturally gravitate to pursuits in which they can exercise a measure of control over their lives.
In most organizations I have been exposed to around the world, bosses and supervisors still make all important decisions. The more important the decision, the more important the boss assigned to make the call. This is especially true of decisions that have financial implications. We still have the offices “above” the working people, filled with staff (some with “green eyeshades”) and supervisors who, without consulting workers, make decisions that dramatically affect their lives. Many layers of bosses and assistant bosses control the behavior and performance of the people below them.
In the past three decades, there has been a proliferation of staff specialists who oversee almost every aspect of corporate life. Many of their names and missions have an Orwellian ring: engineering services, human resources, training, environmental control, strategic planning, legal affairs, finance, risk management, accounting, internal auditing, internal communications, public affairs, investor relations, community relations, production control, quality control.
As a line executive responsible for the Energy Conservation Program in the federal government during the early 1970s, I experienced the debilitating effects of these “serving” central staff groups. It seemed as if I had 15 bosses. Each one of the offices was responsible for something I thought was essential to operating my program. My budget was the responsibility of the budget department. When an issue regarding energy conservation legislation or inquiries concerning my program came from Capitol Hill, the staff of the assistant secretary for legislation took the lead. People like me couldn’t even testify before a congressional committee without an entourage of people concerned that I might say something related to their areas of responsibility.
Workers get paid for the hours they work and, curiously, get extra pay if it takes them longer than a colleague to complete a job.
As the executive in charge of the program, I was not really trusted to operate it or to speak freely about it. It was almost as if I didn’t have a job. At best, my “line” job was about coordinating all the “staff” people who drifted in and out of my program. It is easy to understand why a Collin Doherty could become disenchanted with his workplace.
Basic compensation schemes have not changed significantly either. Workers get paid for the hours they work and, curiously, get extra pay if it takes them longer than a colleague to complete a job. Supervisors and other leaders get paid a basic salary according to their responsibilities, regardless of the time spent performing them. They are usually eligible for bonuses and increasingly participate in ownership benefits as well. As has been the case for nearly three centuries, most organizations employ only two significant “classes” of people—management (variously called executives, leaders, supervisors, directors, and officers) and labor. Discrimination against labor by management is more subtle today than it was during the Industrial Revolution, but it remains demeaning and destructive.
Workers are still “trained” in the narrow function they are expected to perform. Most bosses, however, acquire broader expertise through schooling or doing stints in a variety of jobs. Most organizational leaders still believe a detailed job description for every employee is essential to a smoothly performing operation. In most firms, “control” systems pushed by auditors and managers limit each person’s ability to make decisions on spending the company’s money. The amount is set at zero or near zero for the lowest employees on the organizational ladder. This number usually climbs with each layer of supervision. At the top, the executive director, president, or CEO can often make a decision to spend millions of dollars, and the board of directors or trustees have leeway to spend even more. When it comes to financial matters, average employees and lower-level supervisors enjoy the same level of trust as they did in the 19th century.
“Human resources” has a dehumanizing connotation.
The nomenclature of business also remains largely the same. Labor or labor costs, personnel or personnel departments, are all in common use. Economists still put people in an economic formula (labor plus material plus capital equals production). In effect, people (labor) are simply variables like money and material. Similarly, the label “human resources” has a dehumanizing connotation. We have financial resources, fuel resources, and human resources.
In reading annual letters by CEOs, I have noticed that when an organization wants to make a positive statement about its employees, the letter often says something like, “Our people are our best assets.” After I used similar language in one of my annual letters, I had second thoughts about using the word “assets” to describe people in my company. What do we do with assets? We use them. We buy and sell them. We depreciate them. When they are used up, we dispose of them. I vowed that I would never again use that word to describe the people in my organization. I don’t even like the word “employee” because it has a lingering association with the demeaning workplaces of the Industrial Revolution. (I reluctantly use the word “employee” in this book because it is familiar to readers—so familiar, in fact, that most have never given its connotation a second thought.)
Earlier, I noted that most of the recent books written on organizational success treat uniquely human factors—principles and values, for instance—as nothing more than techniques to achieve wealth and success. The behavior of people is equated with the cost of raw materials and plant equipment. One bestselling book a few years ago was Re-Inventing the Corporation. Invention is a word usually associated with machines or processes, yet much of the book is about the people who work in corporations. How do you reinvent them? Even more problematic from my perspective was the title of another bestselling book, Re-engineering the Corporation. Engineering is a word almost exclusively related to machines, but here again the book was primarily about people and the structure in which they work.
Many business leaders are far more concerned with the tasks people perform than with the people themselves. As Henry Ford famously quipped, “Why is it I get a whole person when all I want is a good pair of hands?”
Several years ago in China, I was visiting with three young women employed by AES. All three had returned to their homeland after attending Ivy League schools in the United States. They told me how in each case their parents had made the decision for them about which school to attend and what classes to take, even though none of their parents had ever attended a college or even traveled outside of China. The parents had treated their grown daughters as small children.
We turn things upside down in the United States. When our children are young, we (wrongly, I believe) let them pick their friends, their schools, their clothes, their movies and music, even their religion, assuming they choose any faith at all. By contrast, when they go to work, their bosses tell them what to do, how to do it, and when.
When I attended business school in the late ’60s, a good deal of pioneering research had been done on how employees respond to different conditions in the workplace. In cynical moments I characterized most of this research with the phrase, “Be nice to the ‘machines’ and they will produce more for you.” That said, many experts over the past 50 years have argued that we should replace outmoded assumptions about workers and fundamentally change the workplace.
Indeed, most thoughtful people today reject the assumptions about working people that guided business leaders at the time of the Industrial Revolution. We understand more about what makes people grow and learn and enjoy work. We have experienced political and individual freedom and love it. Most of us believe that every individual is unique and valuable.
Why, then, has there been so little real change in our large organizations? If we have different assumptions about the nature of people today, why do our workplaces have so many characteristics that their forerunners had two centuries ago? Why are compensation arrangements still designed as if people work primarily for money? Why do managers exercise most of the power? Why do staff officers still hold so many of the levers that control organizational behavior? If we believe that the workplace of Collin Doherty leads to drudgery, emptiness, and dissatisfaction, why hasn’t there been an Information Age “revolution” to correct the problems?
I believe there are three reasons for this resistance to change. The first is inertia. Anytime something is moving in one direction, it takes extraordinary forces to change its course. Restructuring the working environment shaped by the Industrial Revolution is like trying to stop a powerful locomotive heading down a mountain pass. Nothing in the contemporary workplace has matched the power of the innovations that occurred during the 18th century.
Second, the Industrial Revolution produced so much good that no one wants to risk tampering with its successful workplace formula. In a few hundred years, the gains in health care have extended life expectancy by roughly 40 years around the world. Average family income is up, and, even with the large disparity between rich and poor, poverty has been reduced substantially. The green revolution has made it technically possible to eliminate hunger and famine, as long as corrupt governments and civil wars don’t intervene. Few would question that our corporate system has produced social progress and an enormous amount of wealth. Even if a side effect has been to create a workplace that is stifling and joyless, most business leaders consider it a price worth paying.
Third, to change the workplace in a positive way would require executives to give up a large measure of their power and control. This is the chief impediment to a radical overhaul of our working environment. Even if a corporate leader were convinced that surrendering these prerogatives would improve the lives of millions without hurting economic performance, the rewards of power are usually too strong to give up. The result is that few leaders have been willing to take the bold steps necessary to junk a workplace model that reduces employees to little more than gerbils on a treadmill.
Not all workplaces are miserable, of course. Exceptions can be found in all types of institutions—businesses, nonprofits, and governments. But these exceptions usually are not as progressive as their leaders think. Small organizations, especially those where most of the workforce is homogeneous, with similar educational and socioeconomic backgrounds, will often have a more collegial feel than organizations of the industrial age. Law partnerships and consulting groups often operate in ways that make the work enjoyable—at least for the partners. Associates, clerical people, and others in the firms may have a work experience as unhappy as Collin Doherty’s.
Many forces conspire to return organizational structures to the “tried and true” model of the past. Rapid growth diverts the energy needed for organizational innovation. Pressure from aggressive investors or lackluster economic performance can prompt executives to play it safe and organize their enterprises along conventional lines. Finally, no change can be sustained unless leaders have an unwavering conviction that change in the workplace is both right and necessary. This requires leaders with courage, stamina, and a high degree of moral clarity.
These are extremely difficult barriers to overcome. The qualities needed to bring about radical change are rare, even among leaders who share my philosophy and recognize that the results are compelling. It does not surprise me that so few large organizations have instituted workplace reforms and that fewer still have managed to sustain them. And it should not come as a surprise that the culture of drudgery seems as pervasive as it did 200 years ago.
Most of today’s start-up companies begin with a flexible, human-centered approach. This often includes many decision makers, a flat organizational structure, and a collegial environment. Information is shared, relationships are trusting, and management systems are almost nonexistent. In the early days of AES, I was lulled into feeling that living our shared values and principles was going to be easy. “Wait until you grow up,” warned more experienced leaders. “This will not work when you are bigger and substantial changes are inevitable.” They understood that most new workplaces soon become more concerned about improving efficiency and making profits than about creating a more fun and humane environment.
Bureaucratic behavior remains the heart and soul of most work environments. Important decisions are still made at the top. The rest of the leaders and employees are left out of the process or, at best, are asked only for their suggestions. President Clinton once told me about a relatively minor matter that was neatly summed up on a single piece of paper. It contained 22 signatures of people “signing off” on the issue before the president made the final decision.
Most employees in large organizations seldom see, meet, or know the CEO or other senior managers. Countless AES people approached me over the years to say that they were grateful to have spent time talking with me. “I never met the plant manager of the company I used to work for,” was a refrain I heard on almost every trip I took around the company. In effect, they were telling me, “in the other company I wasn’t important, and in this company I am important.” Most employees in large organizations have about as much contact with senior leaders as Collin Doherty did.
Frederick Taylor is given credit for the new era of “scientific management.” He disappointed his wealthy Philadelphia family by going to work in a steelworks, which he found shockingly inefficient. Taylor then became an early version of a management consultant. He timed how long it took workers to perform tasks and rearranged factory equipment to speed the production process. His ideas about improving efficiency swept the country in the first 30 years of the 20th century. While his research led to some useful innovations, his approach reinforced the idea that people are like machines in a manufacturing process. Unfortunately, this view of workers has not changed much in the intervening years. Just listen to the cold, quantitative analyses of people in the workplace articulated by organizational and strategic gurus today.
Even the current emphasis on “training” is demeaning. “Let’s see. I train horses and dogs, and I toilet-train children.” There are, of course, cases in which people need training to master higher specialized functions. But the main image that comes to mind is opening the top of a person’s head and pouring data inside it, much as you would pour oil in a machine or install software in a computer.
Education broadens our experience and understanding. Training confines a person by teaching narrow skills. But you would never know it’s a blind alley from the way it’s described by management and HR departments. They sell employees on the idea that training is a way to advance their careers. It would be better, I believe, to substitute education for training. Education allows people to seek out information that they consider important—and that has the potential to transform their working lives.
Two centuries after Collin Doherty, company finances remain a mystery to all but a few. In companies with thousands of employees, fewer than 50 to 100 people may have access to important financial information, and even fewer have a substantial say over how funds are used. This is true in most governments, corporations, not-for-profit groups, and educational institutions.
While time clocks aren’t found as frequently as they were in the past, most lower-level employees still punch in, metaphorically at least. One of my associates used to work at a law firm where she was made to “understand” that she should be in by 8:30 a.m., even though her boss did not have such a rule for himself and her work was only marginally related to the time of day. In most organizations there might as well be a sign on the wall that says, THE MACHINES START AT 8 A.M., AND YOU ARE ONE OF THEM.
The ever proliferating staff offices do not have direct responsibility for producing a product or offering a service. As one cynical line person once said to me, “staff offices do nothing but keep me from producing what I am supposed to produce.” In their “support” and “coordination” roles, these staff offices often take power and control from people with line responsibilities. Their control of vital information and their usurpation of functions once performed across organizations have made staff offices a major contributor to the humdrum routines of so many working people today.
As noted earlier, the greatest obstacle to worker satisfaction is management’s craving for status and power. But there are other powerful forces within most organizations that push them toward centralization, putting almost all important decisions in the hands of managers, supervisors, officers, and owners. These forces include:
Information and data-gathering technology: John Naisbitt’s book Megatrends suggested that technologies like the Internet would help decentralize organizations, make them more democratic, and give power to more employees. Is this true? Is the Internet making the workplace more fun? It is too early to give a definitive answer. It is clear, however, that the same technology that can allow people to make decisions in a decentralized manner also can be used in the opposite way—to centralize everything.
One of my vice presidents invited me into his office not long after we started operating our first power plant in Houston. On his desk he had a computer that had the control panel for the plant. “Dennis, I can essentially watch and control the operations from here. I can get one for you as well, and we can add all the new plants as they go commercial.” I told him not to bother and suggested he get rid of his as well. This kind of centralization can have a major negative effect on the workplace. It reinforces the idea that plant employees are automatons who have little or no control over the way they work or how their plant is organized and operated. It seems straight out of Orwell’s 1984.
More often than not, lower-ranking people are closer to the problem and better positioned to come up with a solution.
Top-down responses to mistakes and problems: Ken Woodcock was AES’s first full-time business development person and probably our most effective one. Early in the company’s history he came to the monthly business review meeting with a problem. A competitor seemed to be following him from place to place making pitches to potential customers within two weeks of Ken’s visit. Someone suggested that the problem was the internal newsletter that we published monthly to keep everyone at AES informed about what we were doing and what companies we might be interested in acquiring. It was showing up on a competitor’s bulletin board. The obvious solution was to have Ken be a little less specific. One senior person, however, was adamant that the entire letter be reviewed by me before it went out. No one objected to the new policy. Within minutes of leaving the meeting, I realized that we had taken a decision away from the people responsible for our newsletter.
It was a minor issue, but it alerted me to the inadvertent ways we undermine decentralization when someone makes a mistake or a problem arises. There is an intrinsic organizational assumption that mistakes or problems could be avoided if high-ranking people made all the decisions. But more often than not, lower-ranking people are closer to the problem and better positioned to come up with a solution, especially if they seek advice from their colleagues. The tendency to turn to top executives was most pronounced when our stock plummeted in 1992 and again in 2001-02. When the share price turned south, many board members pushed for centralization, which seemed to provide reassurance that the business was being run in a conventional and “safe” way.
Government regulation: The Sarbanes-Oxley Act of 2002, which requires CEOs and CFOs to certify financial results, will have a similar effect of centralizing decisions and making the consequences of work less important and meaningful to the people who actually do the work. Government agencies almost always want to make top executives responsible for every aspect of a company’s operations. Do they really believe this will make the organizations behave more ethically? I do not believe there is credible evidence that this is true. What I do know is that it will drain the joy from those deep in the organization who have the satisfaction each day of knowing that they have responsibility for making their part of the business more productive and successful—and more ethical.
Service suppliers: For years it seemed as if every banker, insurance company representative, coal supplier, and anyone else who wanted to sell AES services of some kind called my office for an appointment. They hoped to persuade me or the CFO or some other central officer that they should get a large chunk of AES’s business. This seemingly benign process can easily result in central purchasing of services for plants all over the world.
Over time, I realized that I needed to get out of the middle of these supplier relationships. The people at our various business units and on business-development teams knew far better than I what they needed and who could best supply it. I restricted my involvement to telling suppliers that we would love to pursue the possibility of using their services and products—and then directing them to the appropriate AES people.
The acquisition of knowledge and expertise: One important goal at AES was acquiring knowledge that could be applied to our business. If not approached carefully, this, too, is a process that can be a force for centralization. When people at AES learned things important to the company’s success, we had a tendency to put them in charge of the area or department where this knowledge would be most essential. Our logic was simple: People usually feel comfortable making decisions about subject matter that’s familiar to them. They also enjoy having people turn to them for their newly acquired expertise. The downside is that their colleagues have a tendency to stop learning and instead become dependent on them, often deferring to them for decisions. This creates its own kind of centralization, not at company headquarters but at the plants themselves, which have the ultimate responsibility for making work fun.
Ordinary workers need independence and a feeling of control if they are going to show initiative and risk failure.
Tom Tribone told me of an analysis of several years of operating data at an ARCO chemical plant where he had worked as a young engineer. Operating performance was significantly better on weekends, when supervisors and other leaders and engineers were not in the plant. His conclusion was that staff technicians were more engaged and reacted more quickly to problems without bosses looking over their shoulders. When supervisors were in the plant, the technicians tended to wait for them to manage the situation.
Another illustration of this point came from the people who were building a new porch on our home. When I asked them for a progress report, they replied, “Depends on how much time the boss spends here. We get the job done faster when he is away. No one waits around for him to tell us what’s next. We don’t wait for him to solve the problems. We don’t expect him to anticipate when we are going to need more supplies.”
People become passive under the control of bosses. Ordinary workers need independence and a feeling of control if they are going to take on responsibility, show initiative, and be willing to risk failure. Putting one’s talents on the line is essential to creating a healthy and fun workplace.
Boards of directors: I tread lightly in this arena for fear of being misinterpreted. My board was responsible by law for what happened inside the company just as I and other officers were. It was not particularly difficult for AES officers to rely on plant technicians or business development people to make decisions regarding environmental compliance, capital investments, or the plant reserve fund. We knew these people, worked with them every day, and trusted their judgment.
It is much more difficult for part-time board members to defer to employees. Chances are that the board members have not even met them, let alone know them well enough to have confidence in their decisions. The natural tendency is for board members to want a senior officer or plant manager to make important decisions. They argue that society and shareholders hold them responsible for the performance of the company.
It is a good argument, but only up to a point. Senior leaders and board members are responsible, but they cannot possibly approve—or even keep track of—every decision the company makes. If the board insists that top management make 200 decisions it ordinarily wouldn’t make, that still means tens of thousands of decisions are made elsewhere in the organization. We bear the same responsibility for these decisions as we would for the 200 we made. If we delegated these 200 decisions to people deeper in the organization, who are probably better equipped to make them anyway, it wouldn’t reduce our liability or our chances of being sued. It would, however, make a huge difference to the people away from headquarters who experience the joy of playing an important role and knowing that the company trusts their judgment.
Paternalism: On my first visit to Uganda in 1999, my host took me to the source of the Nile and then to the site on the river where we were planning a new hydro facility. Our third stop was a huge sugar cane plantation owned and operated by my host’s family. We drove around the expansive fields where hundreds of people were working. When we passed an area of small, dilapidated housing units, he told me that these were provided free to the workers. He was particularly enthusiastic when we visited a building that served both as school and medical facility. “We provide free schooling and medical care. We have whole families who have been with us for years.” “How much do you pay the workers?” I asked. “Enough,” was the reply. “They don’t really need much. They are well taken care of on the plantation.” My host was very proud of what his family, one of the most respected in Uganda, had accomplished. “What do you think?” he asked, eager to get my reaction. “This is one of the most depressing places I have ever been,” I said with only a little hyperbole. “By Ugandan standards, you are taking great care of these people, but they are not allowed to grow up and become independent adults.”
This experience reminded me of the Tennessee Ernie Ford lyric: “You load 16 tons, what do you get? Another day older and deeper in debt. St. Peter, don’t you call me ’cause I can’t go, I owe my soul to the company store.” Paternalism, whether practiced on a Ugandan sugar cane plantation, in Appalachian coal mines, or in a modern American corporation, is far from dead. Managers around the world still feel the need to take care of workers. On a superficial level, it is an admirable response. But paternalism takes on a different cast when examined more closely. It leaves people in a state of child-like dependence. It prevents workers from taking control of their work and lives. They are never in a position to take risks or make decisions, and so never develop to their full potential. In the end, paternalism kills any chance of joy at work.
When AES purchased a hydro plant in Hunan province, China, we were disturbed by the plight of the workers. Health care and education were substandard. I was pulled in the direction of doing something to help these people. Most of us have a compassionate impulse that prompts us to say: “We need to intervene.” Sometimes we respond to the needs of employees by providing health care or by promising job security, higher pay, training programs, or child care. These are all “nice” things to do.
While we need to respond to the problems of our employees, we shouldn’t do so for the sake of being “nice” or “good.” Don’t be afraid to try new approaches that give them control over how they want to live their lives. Instead of providing houses and schooling, pay them enough so they make choices about what’s important to them and their families. Resist the temptation to guarantee jobs for life. Treating employees like children is not in their best interest, nor does it serve the goals of an organization.
The lack of freedom may be the single most debilitating and demoralizing factor in the workplace today.
In earlier days, total concentration on production in factories and on farms was the primary reason that people hated their work. Today, the emphasis on earnings and share price has crowded out the important human qualities needed to run a healthy business—character, values, and concern for colleagues and the integrity of the larger enterprise. From individuals who judge their status in life by the size of their bank accounts to corporations that manipulate their financial results to make their stock price go as high as possible, the desire for wealth often creates systems and practices that are centralized and mechanistic—dictating everything from salary levels to cost controls—and that take the joy out of work.
Despite cosmetic improvements, the workplace has not become a more fulfilling place over the past 50 years. Economic efficiency remains the primary measure of success. Relatively few people are treated as full-fledged adults capable of making sound decisions. Workers are often treated like machines or beasts of burden, almost as if the company wanted to get the most out of its “assets” before it got rid of them. They rarely get the chance to make decisions or act on them. This lack of freedom may be the single most debilitating and demoralizing factor in the workplace today.
Inside typical modern companies, however, you get a very different view than I have suggested above. Workers, especially those at lower levels, don’t seem overly concerned with job satisfaction—at least at first blush. “I like very much what you are talking about, Dennis, but what I really want is security. I don’t want to risk losing my job.” Then I would ask, “What is the most secure place you could be?” After a few rounds of guessing and suggestions, we usually ended up with “prisons” as the places that offered the most security, with bed and board to boot. When confronted with the logical extension of their desire for security, most people saw the fallacy of the goal. Children require security, but when they become adults, the desire for security inhibits their uniquely human abilities to make decisions, take risks, learn new things, fail, grow, make progress, experience loss, and then make progress again. We need to design organizations that encourage people to look beyond job security and seek the psychic rewards that come with a creative, enterprising approach to work. Many of the world’s large organizations are filled with people trapped in the dead-end goal of seeking security. It is the enemy of joy at work.
In my experience, most people don’t believe that fun and work can coexist. In large organizations, so few executives have experienced a joyful workplace that they have no idea how to create one. The result: Most employees grasp for high pay and benefits, fewer hours on the job, the mindless comfort of routine, less responsibility, early retirement, and job security. All are hollow substitutes for a rewarding, stimulating workplace.
If you’re lucky, the workplace created by the Industrial Revolution may put food on the table, pay for your kids’ schooling, and even provide for a comfortable retirement. But “where’s the love, man?” as the old Bud Light commercial asked. Where is the love for work and accomplishment? Where are the other unique traits and gifts and frailties that make us human? Where is the passion to serve? Maybe these were left on Collin Doherty’s farm, or maybe they were lost in the race for productivity and profits. I believe, however, that nothing so fundamental to human nature can be lost forever. If that is true, it will transcend even a movement as powerful as industrialization. It remains alive in many of our homes. It is preached in our churches, synagogues, and mosques. It exists in our memories of teamwork and competition in gyms and on playing fields. I am confident that it cannot be long absent from the place where we spend most of our waking hours—at work.
