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Liberated company

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The term liberated company, popularized by the book Freedom, Inc.[1] by Brian M. Carney and Isaac Getz, refers to an organization which, according to the authors, unleashes employees' initiative and responsibility by treating them as adults.

Presentation

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The notion of liberated or "freedom-form" (F-Form) company was further formalized by Isaac Getz in his 2009 academic article "Liberating Leadership: How the initiative-freeing radical organizational has been successfully adopted" in California Management Review, in which he describes it "as an organizational form that allows employees complete freedom and responsibility to take actions they decide are best".[2] He specifies that, like architects who define human-built structures (for example a bridge) based on functions (allowing passage over an obstacle) rather than structural features, the freedom-form company is similarly defined by its function (to enable freedom and responsibility of initiative) rather than a model.[3] According to the author, to facilitate employee freedom and responsibility, corporate liberation requires transformation—guided by the company's leader—of organizational practices that prevent them. For example, corporate liberation involves a drastic reduction of internal controls, rules, and regulations. Liberating leadership is an essential part of building liberated companies. Liberated companies are based on a business philosophy, not a model, of freedom and responsibility concepts. This is intrinsically linked to liberating leadership, a type of transformational leadership, needed to articulate this philosophy within the human context of each company to build its unique organizational form.[4][5] In this sense, valuable and useful practices for one liberated company would not necessarily be suitable for another.[6] Similar to the diversity in the organizational forms adopted by these companies, there is no standard path or method to build them.[7] Each liberating leader co-designs, together with the employees, their unique liberation path. Further on, the liberating leader maintains and evolves this organizational form that they helped build.

Influences and origins

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The influences most cited by liberating leaders who have built freedom and responsibility-based organizational forms are:

Deployed since 1958 in many countries, it has as pioneers companies such as W. L. Gore & Associates,[10][11] Avis (in the 1960s), USAA, Sun Hydraulics, Quad Graphics, Richards Group,[12] IDEO, Chaparral Steel, Harley Davidson, and Vertex Inc. in the United States, FAVI, SEW Usocome, and Bretagne Atelier in France, SOL in Finland and Radica Games in China.[13] These pioneers have been extremely successful both in human and economic terms for several decades and with several succeeding CEOs.[1][14][15] Despite that, until the 2010s, the phenomenon of freedom- and responsibility-based companies remained marginal.[16][2]

Contemporary practice

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Since the beginning of the 2010s, a growing number of companies of all sizes and sectors, such as Decathlon, Michelin,[17] Airbus,[18] Kiabi, and Poult[19] have entered corporate liberation. Organizations in the non-profit sector, such as two Belgian ministries, the Social Security and a few municipalities in France, have also joined this movement.[20] According to the Belgian business daily L'Echo, 8% of companies have entered corporate liberation.[21] The world region with the highest absolute number of liberated companies is France and Belgium where the phenomenon is called entreprise libérée. Their number is estimated in hundreds and they have been abundantly covered in press,[22][23][24] TV and radio,[25][26][27][28] and even in a comic book.[29]

Comparable philosophies

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A number of leaders have developed organizational philosophies highly compatible with liberated companies: Herb Kelleher in SouthWest Airlines, Ricardo Semler in Semco in Brazil, Vineet Nayar in HCL Technologies in India, David Marquet on a US nuclear submarine,[30] Michel Hervé in Groupe Hervé in France,[31] Henry Stewart in Happy Ltd. In United Kingdom, Jos de Blok in Buurtzorg Nederland,[32][33] Gabe Newell in Valve, Matt Perez in Nearsoft.[34]

Misconceptions

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  • The "model" misconception: Liberated company, a business philosophy based on the freedom and responsibility concepts, is often presumed to be a management model. However, liberated companies have no structural elements (model) which hold across all its past, present, or future implementations.
  • The "cost-cutting" misconception: Liberated companies are sometimes portrayed as a cost-cutting approach because it relies on self-directing teams and needs less managerial and control functions. Though at the beginning of the liberation the costs may go up, liberated companies do not suffer from the hidden costs of traditional companies. Lower costs—and higher profits—are not the goals but are by-products of corporate liberation (see John Kay's notion of obliquity).
  • The "self-exploitation" misconception: The liberated company is sometimes portrayed as a high-pressure work environment in which employees work more, not less. It is true that based on intrinsic motivation, the liberated work-environment is characterized by high worker engagement. Some leaders in liberated companies enforce a limit on maximum working hours,[12] but not all.[35]
  • The "Holacracy" misconception: Because liberated companies and Holacracy both criticize the traditional command-and-control model, Holacracy has been sometimes presented as a "technology" inside of liberated companies.[36] As a consequence, some critiques of Holacracy have been directed by association at liberated companies. Unlike Holacracy, corporate liberation does not rely on any method or model; instead, each time an idiosyncratic path is used to co-invent a unique organizational form.[37]
  • The "Liberation Management" misconception: Because Tom Peters wrote a book with the title "Liberation Management",[38] which is semantically close to the term "liberated company", it is sometimes thought that he coined "liberated company". In reality, Peters never used the term "liberated company" in this book, nor the terms "liberty" or "freedom" [39][40][41][42][43][44][45] which are central to the definition of "liberated company". Peters has agreed with the interviewer's claim "when I read Liberation Management, the two things that come out big in that book are the use of networks and the use of knowledge management".[46]

Criticisms

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Some companies, such as Avis, Harley Davidson, and Radica Games, sought to be liberated and later reverted to traditional command-and-control organizational forms. Since liberated organizational forms are maintained by company heads, if they are replaced by new ones who aren't liberating leaders, the liberated form can quickly dissolve, despite declining performance. Change of ownership can also put a limit to corporate liberation by imposing strategies incompatible with liberated companies' typical values such as trust, fairness, and respect.

See also

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References

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  1. ^ a b Carney, Brian M.; Getz, Isaac (2016). Freedom, Inc: How Corporate Liberation Unleashes Employee Potential and Business Performance. ISBN 978-0-7867-5636-0.(original edition: 2009, Crown Business)
  2. ^ a b GETZ, Isaac (2009). "Liberating Leadership: How the Initiative-Freeing Radical Organizational Form Has Been Successfully Adopted". California Management Review. 51 (4): 32–58. doi:10.2307/41166504. JSTOR 41166504. S2CID 154761150. Retrieved 10 May 2016.
  3. ^ GETZ, Isaac. Liberating Leadership: How the Initiative-Freeing Radical Organizational Form Has Been Successfully Adopted. p. 35. Retrieved 10 May 2016.
  4. ^ TEERLINK, Rich (2009). "On Brian M. Carney and Isaac Getz's book Freedom, Inc.: Free Your Employees and Let Them Lead Your Business to Higher Productivity". strategy+business. Retrieved 11 May 2016.
  5. ^ GETZ, Isaac (2011). "Leader of the free culture: Making an organizational ideal a reality". Leadership Excellence, August issue. p. 5. Retrieved 25 June 2021.
  6. ^ "Organizational Culture: The Hidden Cost of "How" – Center for Creative Leadership". www.ccl.org. Retrieved 11 May 2016.
  7. ^ "Brian's interview and Freedom Inc.'s review in "Leading Effectively"". Freedom, Inc. book. 3 April 2010. Retrieved 11 May 2016.
  8. ^ Max, DePree (1987). Leadership is an art. New York: Doubleday. Bibcode:1989liaa.book.....D.
  9. ^ Max, DePree (1993). "The Leadership Quest: Three Things Necessary". Business Strategy Review. 4/1: 69–74.
  10. ^ Shipper, F., & Manz, C. C. (1992). "Employee self-management without formally designated teams: An alternative road to empowerment". Organizational Dynamics. 20 (3): 48–61. doi:10.1016/0090-2616(92)90024-H.{{cite journal}}: CS1 maint: multiple names: authors list (link)
  11. ^ Hamel, Gary (2007). The Future of Management. Harvard Business School Publishing. ISBN 9781422102503.
  12. ^ a b Richards, Stan (2001). The Peaceable Kingdom. Wiley.
  13. ^ Don Mankin & Susan G. Cohen (2004). Business Without Boundaries. Josey-Bass.
  14. ^ Laloux, Frederic (2014). Reinventing Organizations. Nelson Parker.
  15. ^ Gale, Adam (24 January 2017). "Employee engagement: the French way". Management Today.
  16. ^ Pfläging, Niels (September 2015). "Why we cannot learn a damn thing from Semco, or Toyota". Archived from the original on 2017-05-10. Retrieved 2017-06-18.
  17. ^ Andrew, Hill. "Power to the workers: Michelin's great experiment". Financial Times. Retrieved 16 May 2016.
  18. ^ Pierre, Nassif (10 April 2017). "Le département A380 d'Airbus Saint-Nazaire se libère | Zevillage". Zevillage : télétravail, coworking et travail à distance (in French). Retrieved 10 April 2017.
  19. ^ Godart, Frederic; et al. (6 November 2017). "Biscuits Poult SAS: How Can Alternative Organizational Designs Be Successful?". INSEAD Case Publishing.
  20. ^ Isaac, Getz (16 December 2016). "What can 'liberated companies' teach HR?". www.hrmagazine.co.uk. Retrieved 16 December 2016.
  21. ^ Laurent, Fabri (2017-01-16). "La libération des entreprises est en marche". Echo.be (in French). Retrieved 16 January 2017.
  22. ^ Adam, Gale. "Employee engagement: The French way". Managementtoday. Retrieved 24 January 2017.
  23. ^ Andrew, Hill. "Power to the workers: Michelin's great experiment". Financial Times. Retrieved 16 May 2016.
  24. ^ Isaac, Getz (25 February 2017). "Hierarchies are unnatural – it's time for a liberating revolution". Freedom, Inc. book. Retrieved 22 February 2017.
  25. ^ "Vidéo: Le modèle traditionnel se fissure". Play RTS (in Swiss French). Radio Télévision Suisse. Retrieved 5 April 2017.
  26. ^ "Envoyé spécial. Travail : tous bienveillants ?". news.yahoo.com (in French). Retrieved 24 August 2016.
  27. ^ "Capital – Temps de travail, salaires, hiérarchie : faut-il tout casser ? en replay – M6". www.replay-tv.fr. Archived from the original on 23 December 2017. Retrieved 15 November 2015.
  28. ^ "Le bonheur au travail – ARTE". ARTE Boutique – Films et séries en VOD, DVD, location VOD, documentaires, spectacles, Blu-ray, livres et BD (in French). Retrieved 14 February 2015.
  29. ^ Philippe Bercovici, Benoist Simmat (19 October 2016). Les Entreprises libérées – les arènes (in French). Les Arènes.
  30. ^ David, Marquet (2012). Turn the Ship Around!: A True Story of Turning Followers into Leaders. Penguin.
  31. ^ Ducret, Linda. "Michel Hervé, Groupe Hervé – Un pionnier de la démocratie concertative au sein de l'entreprise". GPO Mag (in French). Retrieved 11 May 2016.
  32. ^ Ben, Kuiken (2017). The last manager. Uitgeverij Haystack.
  33. ^ Frederic, Laloux (2014). Reinventing Organizations. Nelson Parker.
  34. ^ Chuck, Blakeman (November 2015). At Nearsoft, No Managers and Complete Freedom Create Responsibility, Not Anarchy. Inc.
  35. ^ Wieners, Brad (1 April 2004). "Ricardo Semler: Set Them Free". CIO Insight.
  36. ^ "Entreprise libérée et Holacracy : quelle différence ?". October 2016.
  37. ^ Muriel Jasor, [1], 12 Sept 2016
  38. ^ Peters, Thomas (1992). Liberation Management: Necessary Disorganization for the Nanosecond Nineties. New York: Knopf. Bibcode:1992lmnd.book.....P. ISBN 978-0-517-14471-8.
  39. ^ LIBERATION MANAGEMENT: KIRKUS REVIEW. 12 November 1992. {{cite book}}: |website= ignored (help)
  40. ^ "Liberation management: review". Publishers Weekly. 2 November 1992.
  41. ^ Larson, Peter (1993). "Tom Peters: Charlattan or Genius?". Canadian Business Review. 20.
  42. ^ Talton, Jon (3 January 1993). "Peters calls for revolution". The Daily News.
  43. ^ "Mess Is The Message". Investors Chronicle. 23 December 1992.
  44. ^ Lloyd, Tom (9 February 1993). "Book Review – Benefits of going bonkers". Management Today.
  45. ^ May, Barry (23 November 1992). "Failure, The Secret of Success". Reuters News.
  46. ^ Bogner, William C. (February 2002). "TOM PETERS ON THE REAL WORLD OF BUSINESS". Academy of Management Executive. 16 (1): 42.

Bibliography

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  • Getz, Isaac (2009), "Liberating Leadership: How the Initiative-Freeing Radical Organizational Form Has Been Successfully Adopted", California Management Review, 51 (4): 32–58, doi:10.2307/41166504, JSTOR 41166504, S2CID 154761150
  • Carney, Brian M. and Getz, Isaac (2016) "Freedom Inc. How Corporate Liberation unleashes employee potential and Business Performance", Somme Valley House, 2nd Edition
  • Thun, Frank (2020), "Liberated Companies: How to Create Vibrant Organizations in the Digital Age", BoD.
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