Author: Jeb Banner

We are all used to getting notifications from software updating or “versioning” to its next iteration. In fact, we’ve come to expect regular updates from our devices that improve our experience. Apple even turns these version announcements into something of a spectacle. 2.0 replaces 1.0, and so on. Their fans ooh and ahh at new features and functionality. What if we apply this thinking to companies? Should they also seek to version? What would that look like to roll out major updates to your organization?

Is it time for your company to version?

The reality of modern business is one of ever accelerating evolution and change. Entire industries are being uprooted and transformed by new technology and what it enables. New service models, new devices, new ways of working… they are popping up every day. This is putting tremendous pressure on businesses to evolve.

I believe it is time for businesses to adopt the software model and consciously version. Not just their offerings, but the way they deliver them. This starts with the employee experience, the systems and tools the organization runs on, the facilities used to operate and, yes, the product taken to market. You cannot version the offering without updating what powers it.

How do you know it’s time?

Usually when change is overdue, you can feel the pain in different areas:
Is your employee morale declining?
Your market share eroding?
Does your brand feel tired?
Are you getting too comfortable?

All of these are signs that it’s time to version your business. Even if you don’t answer yes to any of these you probably ought to be thinking about it now before you are scrambling to keep up.

To version your company I suggest you start with identifying the past phases of your business. What version you are currently running on? Is it 1.0, 2.0 or 3.0? This creates some a foundation to build from. It also creates language to talk about how things are and how they will be.

For instance, at SmallBox we recently “launched” our 3.0 offerings. This required first acknowledging what our 1.0 and 2.0 offerings were. We started the company in 2006 strictly as a web development shop. The 1.0 version of SmallBox was more of an outsourced development team for other agencies. In our 2.0 era, we branched out into marketing, brand, and finally culture. We often referred to the offerings in this phase as “culture-powered marketing.” We embraced starting projects with “Discovery,” or research that would inform more meaningful designs and solutions.

At this time, we had adopted a new vision: to spark a revolution of people-centered work. We didn’t even yet fully understand what that would come to mean for us, but we stuck with it since it inspired us. Our focus on culture led us to starting client projects at a more foundational level, focusing on identifying or updating organizational values and building core language. This vision and our new ways of working led us to increasingly focus on user experience, design thinking, and deep, strategic consulting with our clients. SmallBox 3.0 is rooted in organizational consulting.

Moving to Action

So, how did we get there? Once we had reckoned with our past and defined our future vision, it was time for action. These were the three steps we found most helpful to getting to our next version:

Team Development
You can’t expect to version your business without preparing your team for the transition. The people in your organization are the real power behind your services and products, so this is not a step to underestimate. The bigger your changes are, the more time and resources you’ll need for this.

We spent the year leading up to our pivot expanding our skills in facilitation, design thinking, and experience design. Some of these skills were already in our toolkit, but we wanted deeper mastery and outside perspective from experts in our field. We hired an expert in facilitation training first. We took online classes and held reading discussions. During our Winter 2016 Factory Week we brought in outside Design Thinking trainers for brand and customer experience sessions. While many of our steps were difficult or time consuming, professional development was by far the biggest investment we made for our transition. Aside from the many hours we invested of our own time, we spent about $50,000 on training for a team of 15.

This area was particularly difficult for another reason – we discovered our new chosen work wasn’t aligned with the career paths of every teammate. We had to make some changes to our team to be staffed correctly for 3.0. Never an easy step. This took time, and many conversations, until we had the right people on the bus.

Product/Service Design
Whether you’re a service or product company, a nonprofit or a business, versioning requires taking a step back and examining all of your offerings. Start by mapping out what your products or services are now, then look at where they need to go. An exercise we facilitate with clients is “Invented/Default Future” which explores what an offering might look like in the future with and without changes.

In our case, some of our services, like branding, just needed a tweak, some needed to be sunset and others needed to be re-designed or built from scratch. We did research, talked with clients, talked with mentors and peers, did countless hours of whiteboarding and collaborating exercises. While we transitioned from 2.0 to 3.0 we began to recognize value in the way we were working and turned that into a workshop which we now offer to clients and the public.

Client/Customer Conversations
This is one of the hardest parts – sharing that you can no longer support an activity that doesn’t align with your new direction. But it’s critical to let go of old things to make space for the new.

We met with our clients to talk about the coming changes, and determine together if we were the right fit for them moving forward. For those still looking for tactical marketing help, we made referrals to a new agency if we aren’t the right partner going forward. We made sure the transition was a smooth one even if it meant doing “2.0” work for a little longer than we had expected.

Making the leap…

By the end of 2016 we will have completed the launch of 3.0. It was often messy and very hard, but we are making it happen and we are confident it sets us up for a long stretch of growth.

If your company feels stuck, maybe it’s time to version. Don’t panic. Just take it one step at a time. Even if you make mistakes, you’ll likely be better than those who choose to ignore the warning signs.

Before we jump into the ingredients of a people-centered workplace let’s start with some foundational assumptions. If you don’t agree these assumptions then what follows might not resonate.

First, the purpose of a company should be rooted in serving people not in producing profit. This is not to say that a company should not care about profit at all—a healthy company should be profitable. But serving people should be the number one reason the company exists.

Serve people, not profit.

Secondly, companies should put their employees first, not their customers. I’m guessing this is where I might lose some folks, so I hope you can stick with me a for a minute.

Let’s consider what happens when you put the customer first. It doesn’t take long before the employee is seen and treated as a cog in machine. They feel like second class citizens—not unique, creative beings capable of great things. And it’s no secret that when a company says “customers first” it translates as “money first.” That isn’t the case in all instances, but more often than not it leads to a profit-first focus.

Put employees first, not customers.

And finally, a company must compensate people fairly for their work. Underpaying or lack of equity in pay can easily undermine any other efforts you make to create a strong employee experience. If you are skimping on compensation, you won’t have much chance of attracting and retaining top talent either. Fix that first.

If you accept these foundational assumptions – serving people over profit, putting employees first, and fair pay – then you’re well on your way to building a people-centered workplace. I’ve found the following ingredients a good framework to consider when you’re ready to invest in your team.

4 Ingredients for a People-Centered Workplace

Ok, let’s dig into the 4 ingredients I believe need to be present in a people-centered workplace. It begins with the individual, then to the tribe, then ripples out to the work, and finally the impact.

1. Wellbeing.
   This speaks to the personal journey an employee takes through their work experience, including their physical, mental and emotional health. The physical space they work in plays a big role in this zone. If an employee doesn’t feel good, it directly impacts their work in a negative way. Employers need to remember that their employees are unique individuals with specific needs and preferences. Treating them well on a basic human level outputs with increased productivity.Good things happen when you invest in wellbeing at work.
2. Belonging.
   We now move from the individual to the group, the tribe. With very few exceptions, we work in teams. When we feel like we belong and are accepted into the “tribe” it creates a needed safety net to be ourselves, which means we bring our best to the work. This outputs as increased creativity and collaboration.Having a “best work friend” can matter more than you think.
3. Engagement.
   This is the “work” itself. What we are doing at work. Are we mowing lawns, crunching numbers, or designing experiences? All work is of interest to someone. Even that which one might deem most undesirable is desirable work to someone else. Are we engaged by the work we are doing? Does it capture our attention and keep it? I often ask people, “When do you forget to eat?” That’s usually a clue about what work they should be doing. Engaging work gives us purpose. It’s absorbing and puts us into a state of flow.Unlocking purpose in work leads to greater employee engagement.
4. Transformation.
   This addresses impact, when what we do goes out into the world, and also speaks to how the work changes us. I believe we have a deep need for meaning, which rarely happens without movement and change. Something must be transformed to create meaning. It could be a life changed with a new medicine or a friendship formed through a shared love of a product. People-centered work must be transformative on some level. Otherwise it leaves a void in our lives, one that pushes us from job to job as we seek work that brings meaning for us.While most of us want to be able to make a difference at work, Millenials and workers of the future will pretty much demand it.

I believe that organizations that have all 4 of these ingredients in place innovate and compete at a level other organizations simply can’t keep up with. They have an engaged workforce that is empowered to do their very best work. They know why they do their work and they feel the impact of it.

Don’t feel discouraged if you still have a way to go to achieve all of these. No company on earth consistently delivers on these 4 ingredients for all its employees. But I believe this framework helps give an organization areas of focus as they look to build an attractive environment and culture for talented creatives.

When I started SmallBox in 2006 I didn’t give much thought to what our “values” were. They seemed irrelevant. I was much more focused on what we were selling and who we were selling it to. I didn’t even really know what a “value” was. It seemed to be a bunch of words well-intentioned leaders put on posters around an office – overused words like “Integrity” or “Honesty.” None of it resonated with me.

But as the company grew I began to sense something was missing. I would get frustrated by an employee’s behavior and not really know how to address it. Was it a pet peeve of mine when someone worked differently from me or was it something deeper? Why did I “click” with some clients and not others? Through experience and learning I began to understand what values were and why they mattered.

There are different takes, but the most consistent definition is simple: values are behavioral norms.

They are how you, the company, act. You can say you have the value of collaboration but if you don’t actually partner and work with others consistently, then you don’t have that value. I’ve also found that the most reliable way to find your company’s core values is to explore your history and the actions of your people. In our work with clients we often mine organizational stories to find the behaviors (aka values) that have driven success in the past. Also, we seek to understand what values were being dishonored when you went astray.

But what about behaviors you don’t consistently exhibit but want to? Should you make them a core value and hope for the best? What about the basic stuff like honesty and integrity? Or community? Aren’t these all values every company should have? Yes and no.

Patrick Lencioni, an organizational health consultant and author, outlines four types of values in his book “The Advantage” (which I HIGHLY recommend). I agree with his thinking and want to share our take on it here to clear up confusion we often run into with our clients.

Four Types of Values

Permission To Play
These are values that every organization needs in order to be in business – the basics I mentioned before like honesty, integrity, respect, etc. Of course, not all companies even honor these permission to play values but those deceptive businesses, assuming they have any real competition at all, usually get pushed out of business quickly.

Accidental
These are values that might be specific to your industry, culture, or region. They are good to acknowledge but they are not core to driving your success. For instance, humor is an accidental value to SmallBox. We certainly value humor but it isn’t really a behavior that we hold other’s accountable to. We don’t say, “You’re not being funny!” It’s just a byproduct of who we are that we like to laugh and have fun.

Core
These are central to how the business operates, the behaviors that you consistently exhibit and hold yourselves accountable to. Lencioni adds: “They are the source of a company’s distinctiveness and must be maintained at all costs.” An example of a core value we often see in our work is “collaboration,” as in “we work together to solve problems.”

Aspirational
These are values that you wish to have but not do currently consistently exhibit. To some extent, every core value is a little aspirational since no organization bats 1,000 on consistent behavior. At SmallBox we initially identified collaboration as an aspirational value until we felt it was a consistent behavior and could be considered core.

As you might guess, most businesses put their focus and energy on the “core” values. As Lencioni famously said, “If everything is important then nothing’s important.” Narrowing your focus to the three to five essential behaviors/values that drive your success is key to sustained health and growth. But we have found that understanding and identifying the other three types of values can sometimes create needed clarity in an organization that is struggling with identifying what is most important.

Can core values change? There is some debate about this but I believe they can. It’s good to revisit them every few years to see if a deeper understanding has emerged. For example, we modified our value of “creativity” to “curiosity” a couple years ago. We felt that what was driving our creativity was actually the behavior of curiosity.

Just remember that core values are tools, not commandments carved into stone.