Category: Neanderthal Management

Amazon’s work culture raises interesting questions.

Posted on 09/16/15 by Aidan

amazon-warehouseAmazon’s work practices, as detailed in the recent controversial NYT article generate interesting questions on Talent Management, Innovation and Culture.

Inside Amazon- Wrestling Big Ideas in a Bruising Workplace” in the New York Times made unsettling claims about Amazon through interviews of 100 former and current employees. Jeff Bezos, founder (1994) and CEO of Amazon (now a bigger retailer than Walmart at $250Billion) refuted those claims is a rather short and uninspiring memo which has led to criticism of his response and gives weight to the claims made in the article.

The article explores the culture of Amazon where it seems consistent and bruising conflict, tension and pressure are the norm. It claims that the company is conducting an experiment in how far it can push its white collar workers, who are encouraged to tear one another’s ideas apart in meetings, toil long and late (up to 80 hour weeks and emails arriving at midnight followed by texts querying why they are not answered).  They also have an internal system (they claim frequently misused) where people can do anonymous performance reports on their colleagues to their colleague’s bosses without their knowledge. Those who do not meet what Amazon call their “unreasonably high” performance standards are forced to leave or fired in annual cullings – called “purposeful Darwinism” by one former employee.

It would seem customer service and innovation is a major focus of and driver of the culture at Amazon. Amazon consistently drives to innovate and want to create opportunity to do so, for any employee with a good idea. Conflict is encouraged. However one interviewee reported his “enduring image was watching people weep in the office”. He continued “nearly every person I worked with, I saw cry at their desk”.  Some interviewees, however, said they liked the culture because it pushed them past what they thought they could achieve. In 1997 Bezos wrote to shareholders “you can work long, hard, or smart but at Amazon.com you can’t choose two out of three.”

Bezos open memo in response to the article is short. He says he does not recognise the Amazon described and that it is illogical. “I don’t think any company adopting the approach portrayed could survive, much less thrive, in today’s highly competitive tech hiring market”. He also linked one employee (of 18 months) who openly refuted the article.

This is an interesting article and response for a number of reasons. It raises questions about HR practices, talent attraction, talent retention, new world business cultures, monopolistic environments, conflict and innovation.

Is this the best way to attract and manage talent?

21st century organisations understand there is a “War” for talent. Talented people create competitive advantage for their organisations. This means attracting and retaining the best people. It has also been long recognised that most of the core competencies of an organisation reside in the heads of their people. This means we should treat our people well, create an environment for engagement, loyalty and collaboration to give the organisation the best chance to continue to be successful.

“Rank and Yank” policies which were fashionable in some companies with household names have been discontinued in many in recent times due to significant flaws. The idea is that the company continuously evolves by cutting the bottom 10% say, of their people. They ask managers to rank their teams and fire the bottom rankers. Sounds harsh? It is.

I worked with a management team last year whose company still did this. The upside they said was that “dead wood” was removed. The downside we agreed was that good people were also fired, that there was often unhealthy competition in teams leading to lack of collaboration, fear and lack of flexibility because the team members were too focused on the metrics which determined their fate. In the “rank and yank” philosophy, there can also be a lack of perceived fairness due to the subjectivity of the team managers who obviously can have favourites and were more likely to keep the politically savvy. Constant loss of team members also means there is constant grieving and probably unrecognised anger in the team. One might also mention the simple lack of humanity of this process.

Keeping people working too-long hours is counterproductive due to its unsustainability and diminishing returns. Henry Ford is reputed to have designed the 40 hour week for this reason and recent research has shown that after 40-50 hours work per week the work done becomes far less effective. It also shows that burnout occurs if renewal time is not included in the working week. There are specialists who make a career out of helping talented people return from burnout and breakdown an expensive fix in many ways. Practices like midnight emails and such interrupt the quality of the rest people are getting, damaging problem solving ability and creativity, and making burnout more likely and talent retention less likely.

Does Innovation require this much conflict?

Conflict is required to innovate but so is safety and agility. Discussion and argument must take place in a safe environment or people will not take risks. Innovation is as much about failure as it is about success. It is also well known that true creativity often requires white space and time, not pressure. Those who are under huge competitive pressure in an adversarial environment are watching their back, not what’s in front of them.

Companies who recently changed their environments from adversarial ones have seen team performance and collaboration rocket. Collaboration, sharing of ideas and innovation go hand in hand.

Where did this culture come from?

It was Richard Branson who said, “Look after employees and employees look after customers”. How does this align with the practices identified at Amazon? It is a well-known adage that customers will never think more of your company than the people that work for the company.

One wonders what sorts of people survive and thrive in this environment.   The theory of Darwinism has been used before, particularly in the 19th century, to justify the mistreatment of people for the “greater good”. Later far more dangerous ideologies used this work as a justification to judge and eliminate the “weak” also.

Measuring and treating people like machines is a hangover from industrial era thinking as is Social Darwinism. Darwinism used socially is a misappropriation of the ideas of survival of the fittest. It is a pseudoscience completely lacking in empathy and out of touch with any modern behavioural thinking. Smart Authentic Leadership gets power into the hands of the team – with leaders being servants of the team, empowering their success rather than being autocratic top down managers treating their people like automatons. That’s not good business.

Amazons culture is relatively new. Having been founded only in 1994 the culture developed from there. Cultures (how things are done around here) evolve over time. One wonders if Bezos background on Wall St and in financial data influenced the culture. Amazon admits it is driven by data and they took advantage of the capabilities of the internet to not only serve customers but to understand customers. Metrics, data and data analysis are the order of the day. Great when applied to marketing data, products, accounts, process and internet behaviour stats. Not so good for measuring and understanding and managing the complex interactions of employees perhaps?

It could be posited that Amazons massive first mover advantage and the competitive advantage it has developed over time does not allow the company to see in financial terms the reported negative impact of its culture and policies. It is recognised that big brand companies have pulling power for talent. However if Amazon had to wrestle with other similar sized companies in its niche for talent and ideas, it may have had to work harder to keep its talent. Talent bleeding out of the company and taking ideas and competencies to competitors who offer a work life balance may have forced them to address the issues a little earlier in their growth cycle, impacting how their company developed.

So what does it all mean?

Amazon was born in a fast moving, changing environment and wants, correctly, to stay ahead of the curve and the competition. They have been innovating and “improving” in order to do this. Perhaps they should also be focusing on staying ahead of the curve in terms of HR and talent management practices.

Bezos is correct in that the sort of culture described seems illogical. The culture does not best support the aims of innovation, talent attraction and retention or customer service.

As an outsider one cannot know how much of the article is subjective and painting a severe interpretation of how things are done at Amazon. One wonders, if it is true, how Amazon can survive with such a harsh inhuman culture. It does not seem to align that the people that thrive in such a culture truly seek to serve and empower others, a sine qua non of modern successful organisations.

Aidan Higgins

Evolution time.

Posted on 09/30/11 by Aidan

Darwin is famously quoted as saying “It is not the biggest or strongest that survive but those most adaptable to change”.  In biological terms its the idea that the organism that best adapts to the environment will survive best and therefore pass on their genes to the next generation. This ideology has been used in most competitive organisations for many years and is an adage used to improve flexibility and innovation within the organisation. For this the general axioms are reduce bureaucracy and encourage change mechanisms within the organisation so that adaptation can occur. In a competitive market place this means change or go out of business.

Evolution is at its most powerful when a defined enviroment gets squeezed, forcing competition. When there is loads of food, space and resources then Evolution slows down but when the pressure comes on its evolve or die.

In the current recession most competitive environments are adapting by cutting overheads, changing processes, getting closer to the customers and such. Some businesses are being clever and taking advantage by defining their niche while the competition is weak and instead of focusing on quarterly results at any cost are getting closer to customers and understanding them and their needs better and improving their processes so that when the gloom lifts, as it always does, they will find themselves positioned at the top of the food chain and the number one in their space.

Others are in survival mode – taking any bit of business that comes along in order to survive. So they try to break out of their niche to areas where they may not have a competitive advantage. Or take the long road to product diversification requiring them while at their weakest to learn a new skillset and a new market. For some this is necessary and there is a natural tension in this and decisions need to be made.

What however is to be done with organisations who are slow to react with rigid bureaucracy, an inflexible workforce and a culture that resists change.  Those without a very strong position in the market will die.  I am watching this in some organisations in this country with awe. Organisations who need to move fast and adapt have either management who cannot change or a workforce, possibly unionised, who are all about “us and them” and never “we” who argue  while their more flexible competitors (abroad) are eating their dinner.

Most interesting is the Public Sector who seem like rabbits caught in headlights and seem to be able to do nothing but CUT things. People. Services. Budgets. What about performance inefficiencies? What about getting more done with less by reducing the amount that needs to be done? What about mapping processes across departments? What about putting real managers into the Health Service for example? From outside the crazy culture that exists? If you get more done with the same people everybody keeps their job and the customers get their services and “everybody goes home with a balloon”.

The question arises – does Evolutionary pressure come to bear on the Public Sector Organisations – if they don’t shape up will they go out of existence. Well – no – in reality it does not apply. On an organisational level.  This is why it is sometimes it is prudent to privatize these organisations to allow their new environment to apply pressures that their current environment does not allow.

But what about Ireland Inc? What about the economic status of Ireland as a whole. The Public Sector Organisations are just parts of a larger whole. And so long as they are as they are and they remain as they are Ireland will suffer. Ireland is in an Evolutionary squeeze. Other more competitive entities are putting their hands up to eat our dinner while we are distracted with political expedience. Ireland Inc is in danger of dying out perhaps? I wonder if those who are focused on their own little territories and those who block improvements at the local level think of what they are doing in these terms?

Perhaps they should.

Aidan Higgins

First Published May 2009

Decent Management?

Posted on 06/15/09 by Aidan

Some of the public sector management stories remind me of a something I came across about the battle of Balaclava in 1854. Famous for the charge of the light brigade and “the thin red line” it became a logistical nightmare. While the British soldiers were up to their waists in water and cholera in summer clothes during the Russian winter, eating their own horses and dying by the thousands, the supplies they needed to survive languished in their ships for months – just down the hill from the front line – because the paperwork had not been properly done.

Front line staff  in public sector organisations are in my experience mostly doing their best often with back end management unable to meet their needs – not because there are too few but because there are too many. And I am beginning to believe that most of these poor managers are not aware of their capabilities and how bad they are.  And their managers are not helping by filling in review forms (where reviews are done at all) in a manner which rewards mediocre performance.

Listening to people who work in some areas of the public sector there are stories of mind boggling bureaucracy and failures. Improvements are resisted by a culture where positional power is taken so seriously it becomes the target of management rather than customer service. This leads to interdepartmental barriers, territoriality and lack of joined up thinking. I often wonder how old the process are in these organisations – did they every go through the BPR’s of the 90’s and are we dealing with systems put in place over 50 years ago.

I was at a hospital clinic some time back and as often happens I and about 20 others were kept waiting in the outer area for the consultants to arrive. There was a young woman on the front desk who was constantly getting enquiries about how long people could expect to be waiting. Of course she could not help – willing as she was – because she had not been informed. So she sat there working on her computer while 20 pairs of eyes stared at her and as people got more and more annoyed due to the delay and lack of information. I could feel the stress in the room and I felt quite sorry for her. I happened to sit down beside her and I asked how often it was like this …

“Oh” she said “every clinic”.

I kindly suggested that she should get a privacy screen so she could do her work without all those eyes burning a hole in her head. She confirmed that she had in fact asked for one and it was coming.

“Really?” I asked “when did you order it”.

She replied “3 years ago….”

This is a complex problem overall and will have to be resolved because the inefficiences generated by this culture drain our countries tax revenues at a far greater rate than is recognised I believe.  A little compassion for those who work for you might be a good start.

Aidan Higgins

Neanderthal Management

Posted on 09/28/08 by Aidan

I have decided to coin a new phrase “Neanderthal Management” – I may not be the first to use it but I am going to use it from now on – a lot. Its a phrase which to me describes perfectly some of the things I see going on around me which is called “Management”. 

Neanderthal ManagementThis was sent my way. It illustrates it nicely. 

Once upon a time it was resolved to have a boat race between an Software Company team and a Health Department team. Both teams practiced long and hard. On the big day they were as ready as they could be. The Software Company team won by a mile.

Morale sagged in the Health Department and senior management determined to find out why they lost. A working party was set up to investigate.

They concluded that their rivals had eight people rowing and one person steering, whereas the Health Department competitors had eight people steering and one person rowing.

Senior management immediately hired a consultancy firm to study the team’s structure. Thousands of pounds and several months later they concluded: Too many people were steering and not enough rowing.

With a view to establishing a vision for victory going forward, the team structure was changed: three ‘Assistant Steering Managers’, three ‘Steering Managers’, one ‘Executive Steering Manager’ and a ‘Director of Steering Services’. Then a performance and appraisal system was put in place to give the person rowing the boat more incentive to work harder.

The next year, the Software Company won by two miles. Addressing the issue head on, going forward, the Health Department laid off the rower for poor performance, sold off the paddles, cancelled all capital investment in new equipment and halted development of a new canoe.

The money saved was used to fund higher than average pay awards to senior management.

Neanderthal Management? – going on all the time.

Read the news.

Aidan Higgins

Putting the tin hat on it

Posted on 02/29/08 by Aidan

Today is the 29th of February. And today provides me with an opportunity to review a certain perspective and attitute to employees and motivation by certain elements in this country.

Work Life BalanceI have been working on or with employee motivation and performance for years now and I advocate there is a correlation between employee performance and workplace happiness based on correct employee motivation. I hold also that certain sectors of Irish Employers still feel that treating staff well is a sign of weakness.

An interesting discussion with a HR manager the other day led to us disussing his experience that companies who are known to be good/best employers are doing so because being top of their game they can afford it. I tried to make the point that perhaps they were on top of their game because they were good to their employees? I also tried to explain the point that money is not the most important factor in employee motivation – the top three being appreciation, the ability to make a difference and getting help on personal problems.

I find there is a cynical approach to employment in certain sections of this country where an adversarial approach is insitigated and perpetuated and sometimes by special interest groups. I remember asking a question a few years back of Jim O Hara – one of the Leading lights in Intel in Ireland. I asked him “Do you think Irish companies get the Unions they deserve?”. He agreed they probably did. I also think Managements attitude often does contribute to many of the problems that occur. I think its a matter of truly caring for employees and showing it. I believe many have learned not to over years of adversarial management and the whole “us and them” philosophy.

I was talking to an employee of the HSE the other day who I asked to tell me one good thing about their employer. Not their job mind, their employer. After 5 minutes of embarrassing silence they he said “let me call you tomorrow on that”.

I have recently discussed with another public sector employee in a 365 service environment the situation of Rota preparation and the managers reluctance to actually give people the time off they request when it made no difference to cover overall. When he asked why he was told ” We can’t do that….they might get used to it”.

Now I have come across stories again and again like that and I believe that besides the adversarial approach to work management contributed to by both sides there is also a lack of real care about employees. Aside from the social aspects which this is not about – it makes good business sense to treat people well. A quote from a documentary shown on RTE made by a German Poet in the 1960s which was recently reshown comes to mind…. “The Irish love their children as long as they’re children”. Too strong? – perhaps – but this attitude has to change.

Its needs a Management initiative – and it will need trust and time. And it will need government support. Its not getting too much of that sort of attention. And now we are getting to the reason I am sounding off today on February 29th.

The Irish government have announced their understanding of a need to do something to recognise the need for work life balance for employees (and management too it must be fair) and so they have decided to announce a “work life balance day” where we consider this important aspect of well-being of Irish employees…….  and yes …….. they did indeed make it today – Feb 29th in a leap year.  Speaks volumes really.

Aidan Higgins