According to a study from the University of St. Gallen, 70’000 to 80’000 SME’s in Switzerland will approach succession during the next 5 years. Statistically, 40% of successions are failing. 400,000 jobs are at risk.

Is self-organisation the solution?

4 experts agreed: the answer is yes.

 

 

Fireplace Talks from 22 January 2018

Succession without a Successor?

with Dany Waldner, Gerhard Andrey, Franz Röösli, Ralph Höfliger

 

An event by

 

 

The essential findings summarized:

How does the Next Generation Organisation function?

  1. Opinion and decision making, decision and action instead of action, principle of subsidiarity: In the classical power hierarchy, thinking and acting are separate: decisions are made at the top and explained to the bottom. Liip has laid the responsibility for a decision on the “place of action”, which makes the organization intelligent, fast and customer-oriented.
  2. Maximum transparency: To make the right decisions, employees need all the relevant information. Therefore, the principle applied by Liip: all information about the state of the organization is accessible to all, unless there is a compelling operational reason to keep information secret (in a hierarchy, information is power and is often held back).
  3. Distinction between working IN the system and working AT the system: Liip differentiates between meetings that serve the execution of the upcoming work (work IN the system, “operations”) and meetings that serve to improve the organization (work AT the system, “governance”). This distinction makes the company very adaptable and agile. Changed framework conditions are immediately recognized and responded quickly. You do not have to wait until the next reorganization, as in a classic power hierarchy.
  4. Decisions based on “no serious objection”, consensus: At Liip, decisions are taken with a kind of “referendum” procedure. Unlike a boss’s decision in a power hierarchy or a majority vote in a democracy where a minority can be raped, the consent procedure will accept a solution if no substantiated, serious objection is raised against it. This decision-making process gives all employees responsibility for the decisions they have taken and promotes their identification with and commitment to the company.
  5. The owners provide “the house for use”: Instead of a profit-based dividend, the owners of the company get a “rent” for making venture capital available to the organization and thus allowing it to operate.

The separation of money and power can be largely implemented with an AG, as in the case of Liip, but even more stringent forms can be chosen, e.g. an association or foundation that holds the capital of the operational, self-organized company and contractually transfers the free will and decision-making of the company.

The transformation process: how do you hand over the company to the employees?

  1. Gradually empower employees to take responsibility: Dany Waldner combines in his person as patron a variety of roles, from acquisition, finances, personnel, organization, infrastructure, to conflict resolution. These individual roles and related tasks are analysed, dressed in areas of responsibility and gradually handed over to the employee.
  2. From decision maker to coach: Letting go of everyday decision-making is not easy for the patron, but it is necessary for him to decide less and less and to empower his staff to make the right decision. Instead of “We’ll do it like that!” Dany asks today, “What are you suggesting, why, did you include this and that, in your thinking?”
  3. Define clear areas of responsibility: For employees to take responsibility, it must be clear to them how they can decide freely. The company is therefore divided into circles and roles. These are assigned well-defined responsibilities, with clear framework conditions, evaluation criteria, etc.
  4. No single-handedly more: Often a patron is a kind of “lonely wolf”, used to do everything on their own when needed. In order to transfer the great experience and the huge knowledge to the employees, Dany therefore started to involve his staff at all times, as far as possible in all activities, for instance no longer making an acquisition alone.
  5. The way is the goal: Basically, there are two ways to introduce self-organization: either take an existing “constitution”, such as “Holacracy” and transmit the power of leadership to this constitution, as the owners of Liip did, “when it became too chaotic”. Or, together with the employees, in an evolutionary self-organization process, they develop their own constitution tailored to the needs of the company and its people, as Dany Waldner does. In both approaches, it is crucial for success that employees assume responsibility step by step for the transformation process as well – the journey is the goal.

 

The conversation ended with the realization that there is a double benefit, which makes the topic so actual. In many cases, self-organization is not only the best solution for succeeding an owner-managed SME, but it also promotes agility, adaptability, resilience and innovation, key success drivers in a world characterized by volatility, uncertainty, complexity and ambiguity (VUCA).

We sincerely thank you all! nextgeneration.world