Building The Perfect Company

If you were to start your own company how would it look? Would you create it along the traditional lines of a corporate enterprise or try something a little different? Anyone who has worked in an office can tell you how depressing an environment some can be but in an age of digital connectivity does it really have to be this way?

Photo by net_efekt

I was considering these questions the other day while imagining how my own company might look if I was to start one. Google is often used as a popular example of the perfect work environment but it’s not really something which can be copied unless you have buckets of cash to throw around (unlikely these days). So how do you create a sustainable work environment where people can be both productive and happy?

Here are a few quick ideas which came to mind:

  • No offices – people work from home or in shared workspaces/cafes/wherever you feel productive.
  • No meetings/email – avoided through the use of collaborative tools like IM/Skype and Google Docs (Wave will be great for this).
  • No titles/hierarchy – although people might have specific responsibilities all have an equal voice.
  • Democratic decision-making – anyone could submit a proposal which everyone could vote on transparently.
  • No formalities or buzzwords – suits, acronyms and MBA’s can be left at the (virtual) door. No room for egos or empty words.
  • No fixed salary/bonuses – compensation would be split equally between everyone after overheads and other investments are deducted.
  • Minimal process – these things always start off well but then turn into unmanageable monsters. CMMI no thank you.

While it’s unlikely that these rules could be implemented in their purest form (the odd email may still be required) I think the principles could be applied quite well to a small startup. A key part of this would be hiring people who weren’t wedded to the old school system and prepared to approach things differently. This wouldn’t work with existing organisations or with people who were only interested in following orders (which are often harder to find than you might imagine).

The end goal of this is to produce the right conditions for people to produce their best work while having the flexibility to live their life outside of an old set of rules and constraints. Traditional business has long been fat and bloated with process for process sake and rewards having very little connection with any tangible results. I say it’s time to change all that.

Anyone with me? How would you build the perfect workplace?

David avatar

6 responses

  1. I’m not sure that I would agree with all the ideas you’ve suggested, although in some cases I can see where the ideas have come from.

    I don’t think the office can be done away with. I don’t like working from home (which may seem strange), mostly because it doesn’t feel like work and I don’t feel motivated at all. The physical transition between home and work seems to be important to get me into the right mindset. Being at home, or in distributed small groups I think people will miss out on the psychological benefits of face-to-face interaction with people in other parts of the company.

    Similarly, meetings have existed since the dawn of time for a purpose – they are a very efficient means of agreeing on ideas (if done properly and not involving people who just BS their way through things). One-to-one communication and small group communication can be done over IM/telepresence for brief or otherwise impractical (think distance) meetings, but as with teleworking I think there’s great value to be had from physical presence.

    I work in a small company, and so the heirarchy is fairly compact. There’s the MD, Operations Director and Technical Director above me. There is also a Creative Director in parallel to the Technical Director. That’s pretty much it. In general this works well for us, but I haven’t got any experience of larger organisations.

    The heirarchy guides communication on important business issues. For example, if there was a serious problem discovered by someone low down, they report it up the tree until someone makes a decision. Without a heirarchy, such things could become lost in confusion over what peoples responsibilities are.

    In essence, provided you’ve got the right people in the right positions with just the right amount of tree-ness, I think titles and heirarchy are a very constructive thing. However, for people in larger organisations where incompent people inevetibly creep in further up the chain, I suspect that their experiences might give them reason to disagree.

    Democratic decision making has some merits, however it’s vulnerable to being abused by idiots (I think Scott Adams raised this point too). Essentially, I think if you have a good group of competent people, a degree of democracy will work because you’ll all understand each others points. However if there are exremes of competents and incompetents, then when people don’t fully understand what they are voting on the benefits are lost and would probably be worse than the traditional leader-makes-the-decision method. So it comes down to people.

    I must agree that formalities and buzzwords should die though, especially if they come from the mouth of an MBA. Apart from when visiting clients, we dress informally in whatever we feel comfortable. If people are comfortable, they are generally happy. Happy people think better and work more efficiently, in my opinion.

    The very communist-sounding way of splitting earnings would completely destroy the good people and cause the others to be apathetic about improving themselves, especially in large organisations where the general mentality is that no one person can make any significant change (and therefore not alter their earnings). Would you honestly be happy that you were being paid the same as the part-time cleaner, or even the top executive?

    Then again, some salaries are completely unjust considering what people actually do and how good they are at doing it – again this tends to be a problem in big organisations (like banks, for example). In smaller companies there tends not to be the room to have widely varying salaries, because there isn’t such a huge (non-existant in the case of banks) surplus of cash.

    Processes should be based on common sense and experience. No bleeding-obvious process construction frameworks required. No jargon. Just keep it simple, and modify as and when needed.

    By the sounds of it, I think you’ve been in a corporate culture for too long 😛 Time to work for a smaller company, David, with a great bunch of bright people.

    I have a vague idea of how I would like my company to be, but so far that idea has focussed on the building. I think that the architecture of the workplace is also hugely important for the wellbeing and productiveness of employees. People might not mind meetings so much if they were held in a well-designed light and airy room. Employees might choose to work in the office rather than at home if they had a choice of the type of working environment they want – single office, shared office, large open-plan group, cosy open-plan group.

    However I think the most important step towards the perfect company is involving and acknowledging the contributions of all staff. If someone has an idea that even has a spark of merit, it should at least be heard out.

    If the idea isn’t completely unthinkable, then make that member of staff responsible for investigating it further, putting together a business case, and seeing it through to the end – even if the end is rejection of the idea. That person should feel worthwhile, knowing that their idea has been considered and accepted or rejected based on consideration of the business case.

    Having felt the glow of being taken seriously, they might then be inclined to come up with more, increasingly brilliant ideas.

    Stagnation is what kills a company. Ideas are what make a company grow.

    1. Hi Simon, thanks for your thoughtful response. I think you make a lot of good points and definitely what I outlined wouldn’t work for everyone or every type of organisation.

      I envisage this environment for a very small company (<20 people) who are all highly competent and live all over the world. They would meet once or twice a year in person but the rest of the time work apart (geographically). They would all be of a similar level and there would be no positions like cleaner or receptionist so hopefully people wouldn't feel the compensation distribution was unjust – and if they did they could vote to change it anyway.

      Communication is the key here. Having spent the last 4 years working on outsourced projects I know how difficult it can be when a geographical split is involved, however as long as everyone is brought into the same mindset of collaboration around a single point using tools like Skype/Google Docs/SharePoint (yuk) it can work quite effectively. For people who crave a bit of human interaction and don't find their home a productive place to work they can work in libraries / cafes / park / etc. I find offices soul sucking places in places in general.

      Examples where some of these ideas have been implement quite successfully (and inspired me):

      Automattic – the people who make WordPress and a bunch of other cool open source things

      ZIA (in German) – see a presentation about how they work here –

      Tim Ferris – author on “lifestyle design”. While I don’t agree with everything he says/writes he does have some interesting ideas and a very inspirational book.

  2. Infini avatar

    “…but the rest of the time work apart (geographically). ” LOL. Now I see how much room you need these days. 😛

  3. Re-thinking your points, I can now see that they probably would work well for smaller companies with competent people as you’ve mentioned. They could also apply to larger organisations where everyone involved is working for genuine interest and a drive to see projects succeed.

    This clearly covers Open Source projects, where those who get involved only do so because they are interested. It would be interesting to see a for-profit organisation working in this way, and making significant profits – after all that is the underlying purpose behind business. The reduction in overheads of an office-less business would probably contribute significantly toward this.

    You’ve certainly opened up my mind to new ways of structuring a business. Who knows, if I can find the right people to join me maybe something along the lines of what you’ve suggested could be used for my hopeful startup!

  4. yaoyao avatar

    Hi,David,Good perspective.It will be highly appreciate if my boss could be so wise.

    As a chinese girl,i had never thought about building my own company one day ,and won’t in the future.but still have different viewpoint about it in some aspects.

    One is about the salary,if compensation being split equally between everyone,it is communism.It doesn’t work in so many countries,they pay heavy price for it.Do you think there will be some possibility to realize it in the company now? Different people has different contribution.And the one whose contribution is greater should get more reward.Incentive system is a must.
    This way can only make your company more attractive to medioare man,And the real able man would like to leave.It remind me of China in old system.
    And it is really ridiculous that the newly gradutes will share the same salary with the experienced ones.

    For the other one, i think systems should be varied with What kind of company do you want to building.Not lump together.
    To run a company,you should have your own product(tangible or intangible).Profits should be used to give the employees’ salary and also to upgrade the product to make it more popular in the market.The company should have its clients.To survive in this such a competitive society is not so easy.We had heard so many stroies about the tough time when entrepreneur just register his own company.
    If you do,Hope you can succeed without too much pressure and diffcluty.

    You are really intellient to these perspective.Maybe you can’t accecpt chinese thinking,we piont out the difficulty before trying.Since i won’t try,I just would like to give my viewpionts for your reference.

    1. Hi Yaoyao, thanks for your comments. The more I think about it the more I think the compensation part would be hard to implement in reality. While I think it could work well for a small company (<5 people) I think as the company began to grow it would probably be unworkable but I include it anyway for discussion.

      I would like to foster an environment where everyone is free to give their own opinion and perspective. Sometimes a fresh graduate can bring new ideas an inspiration so we shouldn’t discount them because of their “inexperience”. I think they can be just as useful in many situations.

      The point of this idea is about trying to build a company which is fundamentally different from what currently exists so I am not so concerned about how this are or “should” be run.

      Thanks again for your viewpoint, I hope one day I can test some of this theory in China!


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