7

Creating Home

Getting Started toward Becoming a DDO

This is our last chapter, but we want to talk more about beginnings than endings. In the same spirit of chapter 1, where we give you impressions of life inside the mature DDO—plunking you down in the middle of them and inviting you to turn your head this way and that—now we invite you into a similar collection of glimpses into fledgling DDOs with whom we’ve worked. If leaders of an organization are considering a move in this direction, how would they get started? They may not know, at the outset, how far they will choose to go, but how do they begin?

You can’t get out on your developmental edge until you’ve created practices that bring it into view. And you can’t sustain these practices (your groove) without first fostering a setting to support a new level of vulnerability. So, for us, the first moves in getting started always have to do with creating a home to support a new level of personal and collective learning.

There is no one right way to get started, and you won’t necessarily find your right way in the glimpses we show you here. But hopefully they’ll help you think about what might best fit your setting.

Before we begin the tour, we want to say explicitly that we’re speaking in this chapter mostly to people who have some kind of formal authority—CEOs, division leaders, team leaders, managers. That is because we believe you’re the people in the most powerful position to decide whether you want your organization (or unit) to head down the path toward becoming a DDO. You can’t make it happen on your own, but if you’re not on board, it’s not likely to succeed in the setting you lead. You’ll see in the pages ahead that it’s possible to approach the work from the top down, the middle out, or a combination of the two. However, no matter which pattern you use, those in the lead (of the team, the division, the whole organization) need to publicly serve as enthusiastic exemplars of the DDO idea, visibly operating with their fellow leaders as a developmental community for themselves, and demonstrating the requisite openness and vulnerability in their relationship to the rest of the organization. It is no accident that the remarkable set of leaders from Bridgewater, Decurion, and Next Jump whom you met in previous chapters are at once staunch champions of, and full participants in, their unusual cultures.

In saying this, we hope we don’t lose you if you have no formal power or authority in your organization but nonetheless are enthusiastic about DDOs. Let us clarify our view: we believe everyone at every level can exercise a form of power and influence in and on an organization. Worthy ideas can spread from one person to another, and, before long, a small instance of positive deviance can develop, and someone with formal authority can take notice. Consider trying some of the practices in the box “Being Deliberately Developmental without a DDO.”

Look for opportunities to make your passions and your thoughts known to decision makers. Take the stance that you believe they could join you in your interests and efforts.

Being Deliberately Developmental without a DDO

So, you’re in the early or middle stage of your career, and you don’t work in a DDO. How can you work on growing every day? Try these practices.

  • Become developmental buddies with someone. Creating a sense of home is important for your development, and you can experience it by mutually sharing what you’re working on about yourself. Remember that it’s not about giving each other advice about how to solve problems. Rather, it’s about giving one another a chance to regularly check in about how your growing edge is showing up on a daily basis. Useful questions to ask a development buddy go something like this: “What did that experience bring up for you? Why do you think you had that response, reaction, thought, or fear?”
  • Seek input about your growing edge. It’s hard to take advantage of all the opportunities to grow at work if you don’t have a sense of what you’re actively working on. Try this simple exercise to jump-start identifying your own growing edge. Ask three people you trust, who know how you get work done, to answer a question for you: “As someone who knows me and wants to help me keep growing, what do you observe that I could be doing differently that might make me more effective?”
  • Create an immunity-to-change map on your growing edge goal. Turn to chapter 6 for guidance on creating one. Share your map, as well as your observations and tests of your big assumptions, with your developmental buddy.
  • Seek bite-size, regular, meaningful feedback from trusted observers. Ask trusted colleagues to watch you during a meeting, a presentation, or other setting and give you a little feedback afterward. For example, hypothetically you might say, “I’m working on doing more active listening and less talking, less justifying of my reasoning and sharing my opinions. Can you tell me what you notice about my actions in this meeting?”
  • Bring your manager into your growth agenda. If you feel comfortable doing so, tell your manager about your goals for learning and growth. When you proactively seek feedback and signal your intention to keep working on your effectiveness, by and large, your supervisors have more room to mentor you. For most managers, it’s a breath of fresh air—and a clear win-win situation for the organization—to have employees with a genuine interest in self-improvement.
  • Watch for modeling by others. Some colleagues and experienced leaders are especially good role models for seizing opportunities to grow at work. Look for evidence of people who seek active input, publicly model learning behaviors, and invest in others’ growth. Watch what they do, and ask to talk to them about their day-to-day approach to learning and growing at work.

Tell them what excites you about imagining being part of a DDO-like community. Share what you’ve learned from personally experimenting with any of the practices you’ve tried. Tell them you know that there are places where the answers to the following questions are all positive: Does your organization help you identify a personal challenge—meaningful to you and valuable for the company—that you can work on in order to grow? Are there others who are aware of this growing edge and who care that you transcend it? Are you given support to overcome your limitations? Can you name and describe them? Do you experience yourself actively working on transcending this growing edge daily or at least weekly? When you become a more capable version of yourself, is it recognized, is it celebrated, and—when you’re ready—are you given the opportunity to keep growing? Give them this book, and ask to meet with them after they read it. Let them know we’re ready to help you and that resources you will learn about in this chapter can be made available to your organization, too.

Let’s jump in and get a first, brief glimpse of a company looking to become a DDO.

XYZ, Inc.

We are sitting in a large, multipurpose conference room on the top floor of the headquarters of XYZ, Inc. (the name is fictitious, at the company’s request; all the facts are true). With cameras and light poles scattered about, the space looks more like a TV studio than a corporate boardroom. Seated in a circle before us are the ten top leaders of this multinational company with annual revenues exceeding $20 billion.

We have just finished commending these leaders for their courage. Having inherited a company, some eight years earlier, that had shaky performance and a dismal, eye-rolling regard of its customers, this group has taken a complicated organization and turned it around. They have made XYZ one of its sector’s most admired companies by installing a top-down, give-orders-take-orders culture throughout, one that is marked by efficiency, hierarchy, and zero tolerance for mistakes.

We admire their courage because, here they are, about to renounce the very culture that is winning them regular plaudits in the newspapers and the praise of taxi drivers and local lunch companions, whom we have randomly asked, “How do you feel about XYZ?”

“The predictable path for a group of leaders who have received as much credit as you have,” we tell them, “would be to ride this winning horse until it drops.”

“The culture we created,” the CEO says, “might have been necessary to turn around a company in crisis. But we believe, and our people agree, it will not be the best culture for the next twenty years.”

“To deal with the world in front of us,” the head of HR joins in, “and to bring out the best in our people, we need a much more collaborative, more innovative, more risk-taking culture.”

But changing any culture, much less one with over a hundred thousand employees, is not an easy job, as this group knows well. “Everyone might raise their hand,” the HR head says, “when you ask who’d prefer to work in the new culture we hope to move to. But when you ask, ‘Okay, so who wants to make the first big mistake?’ it’s a different story.”

This is a classic example of an adaptive challenge. There will be new skills and new concepts to learn in order to move to the new culture. But new skills and new ideas alone will never be enough to get XYZ where it wants to go. People will need to change their mind-sets, not just their skill sets. They will need to know what’s in their third and fourth columns in their ITC maps. What are the hidden, self-protective commitments that keep a team leader from shifting her top-down style to one marked by significantly more delegating or that enable a team member to push back on an order from his boss? (As you learned in chapter 6, hidden commitments might be, “I am committed to not putting my ability to deliver on my goals in the hands of someone else whom I then have to depend on.” Or, “I am committed to not having my boss feel I am disloyal, or not a team player.” Hidden commitments must be overcome for people to meet their improvement goals.)

And how important will it be, not only for each employee to know his own immunity to change but also for his colleagues to know—his team members, his team leaders?

A New Kind of Home

What are we doing there, in this circle on the top floor of a building? The simplest answer: we’re helping the leaders begin to create a new kind of home at XYZ, Inc., a community where employees can see and value each other as individual human beings and can hold the greater degree of vulnerability that will be necessary for the company to meet its adaptive challenge. We’re starting with the leaders at the very top. We’re going to take each of them through the experience of creating their own immunity to change maps, and they’re going to have the chance to share them with each other.

Weeks later, the HR head will begin to spread home beyond the C-suite. He will introduce us to the first of four groups of 150 leaders we will work with at XYZ—the 600 senior managers of the company, each of whom is running a business unit. He will set the stage for an invitation to greater vulnerability in this large, publicly traded, multinational corporation.

“I’ve gone through the same experience you are about to go through,” he will say. “And so has every member of the top team. We wouldn’t be asking you to do this if we hadn’t experienced the power of it firsthand.”

The HR head will continue, “I’ll give you a little taste of how I experienced this. You know that thing that can sometimes happen with your iPhone, where all the icons start to jiggle? Well, that’s what this was like for me. So let me introduce you to Dr. Lisa Lahey. She’s here to jiggle your icons.”

XYZ employees’ concept of home will continue to widen when, months later, the head of leadership development will introduce us to about a thousand employees in twelve countries connected via webinar. Each of the six hundred senior managers has a top team of eight to ten. Home will eventually spread to the more than five thousand team members of these six hundred senior managers via four such webinars, each guiding more than a thousand employees through their own ITC maps, over three or four hours, in the company of their team members and team leader.

As we prepare this book, XYZ is making plans to spread home beyond the top six thousand to tens of thousands, via a highly engaging, highly interactive digital space we have cocreated that will provide several months of online support to XYZ employees who will test and overturn their big assumptions through experiments they will run at work—and, apparently, at home as well. (An XYZ employee came up to one of us during a recent visit to headquarters. “I know you don’t know me,” he said, “but I recognize you from the videos on that ‘immunity’ stuff. I just want to tell you, I’m frankly not sure yet how much better this is making me at work, but my wife wants me to thank you for making me a much better husband!”)

Early Indications

Will XYZ become a DDO? Will a 100,000-person company ever become an everyone culture? Who knows. Decurion, Bridgewater, and Next Jump are all privately held companies, owned (at least in part) by their leaders, with no more than about a thousand employees each. It is natural to wonder whether a DDO must fit these characteristics. But with XYZ as an example, it’s possible to imagine how a huge, publicly traded, multinational corporation begins to create an expanding home that can host the vulnerable-making groove of a practice like ITC, helping thousands of people, out on their edge, meet individual and collective adaptive challenges.

What we do know is that the work pays off. The company conducted an interim assessment of the impact and value after about a year and a half, comparing a group of senior managers with whom we worked with a comparably positioned group with whom we had not yet worked. XYZ decided the internally respected metrics for determining end-of-year bonus—metrics tightly tied to the performance of the units these managers were running—would be a good proxy for assessing impact. “In the aggregate,” they asked, “does the group that has been participating in the personal-change work receive a higher end-of-year bonus than the group that has not?”

The conclusion: the group with whom we worked, in comparison to the group with whom we did not, added slightly more than a billion dollars to the company’s revenues.

A Multiframe View: The Four-Box Model

Before we give you an extended look at another organization beginning to explore the DDO route, let’s step back for a moment. Even in this first brief picture you can see several elements at play at XYZ, Inc.

  1. The organization, as a whole, has identified a challenge, which is inevitably some part problem, and some part opportunity. In this case, a large multinational with a traditional culture wants to morph into a twenty-first-century company that is much more innovative and entrepreneurial.
  2. As a result, individuals in the organization will find themselves with new challenges, new definitions of their roles, new answers to what constitutes doing the job well. For XYZ, all down the line, people need to be better delegators; people need to step up and take more initiative rather than wait for orders.

Note that these two elements would be intelligible and uncontroversial in any organizational setting or any management school curriculum. The first moves in the journey to becoming a DDO are nothing esoteric; rather, they’re firmly anchored in the present realities and future aspirations of the business, as any leader might think about them: “What is going on in our organization and business sector right now? What do we want to be different?” (If the answer to the second question is, “Nothing! All is well and looks to stay that way,” it’s not likely you would want to start any change journey, let alone something in the direction of a DDO.)

So the first two arenas would make perfectly good sense, whether or not you had read a page of this book. But these are not the only elements signaled in the XYZ example. Let’s look at two others.

  1. 3. To meet its outward-looking organizational challenge, XYZ has simultaneously engaged in an extensive look inward. Leaders asked, “What is our institutional personality or culture like? What do the most familiar patterns of what we do and how we act say about what we think and believe?” The XYZ leaders characterized their culture as too authoritarian, too top-down, too much giving and taking of orders; the company had been indirectly telling its people it was more important not to make mistakes than to innovate. Then the leaders asked, “What is it going to take for us to change our culture? What collective mind-sets will need to shift? In what ways are we most likely to sabotage or prevent any collective change we might try to bring about?” In XYZ’s case, it is going to be a big shift for the system as a whole to get out of the “take orders from above/give orders to those below” pattern. “What risks do we assume, collectively, we would run, for our leadership and our followership, in trading parent-child patterns for adult-adult ones?”
  2. 4. Nor does the inward turn stop at the level of the organization as a whole. Individuals too will be faced with new expectations, and meeting these will require new learning. If this new learning constitutes adaptive as well as technical challenges, then it will be necessary to alter individual mind-sets and to understand the dynamics that prevent or undermine personal change. The immunity to change approach, which you learned about in chapter 6, is only one way of doing this, but it is the one we know best, and the one XYZ used. Pushing back on one’s leaders, and accepting pushback from one’s direct reports, will inevitably wreak havoc with currently unchallenged personal assumptions about authority, responsibility, and risk.

Our colleague Ken Wilber has created a four-box model, which has been a valuable heuristic for a more comprehensive view of any complicated psychosocial phenomenon.1 (We express our thanks, as well as apologies for any liberties we are taking with it here.) Wilber’s four elements can be arrayed in a fashion that attends to the distinctions between the individual and the organizational and between the exterior and the interior (see figure 7-1).

Wilber’s central motivation was to remind people of their tendencies to look at a phenomenon through too few lenses. The psychologically minded, for example, may be inclined to consider a change topic (say, gun reform or healthier eating) too exclusively from the individual interior perspective (“How can we better understand the motives and feelings of individual voters or eaters?”) and ignore the need to consider more systemic issues (“What is the role of the National Rifle Association in preventing Congress from responding to the 70 percent of the population that supports background checks for gun purchases?” “How are we socialized from an early age to become overdependent on sugar or to take an unhealthy view of the amount of meat that should go into a main course?”).

Those who are more comfortable with a systemic, political, or organizational perspective may be prone to the opposite myopia, overattending to the organizational exterior. We have seen many efforts, such as those to reform the US public education system, founder on change designs that reflect a sophisticated understanding of the dynamics of organizational change and resistance to change, but a naive understanding of those same dynamics in the individual psychologies of administrators and teachers who must change the ways they think and act, and vice versa.

The four-box heuristic invites people who are thinking about moving in the direction of a DDO to keep their eyes on all four boxes, what Wilber refers to as an “integral,” or more adequately holistic, perspective. The model reminds us that it might be easy for the authors of this book to overattend to the two interior boxes in figure 7-1 (the invisible interiors of the individual and of the collective); for line leaders and people trying to meet quarterly targets, it might be easy to overattend to the exterior boxes. We are all prone to one or the other kind of myopia.

FIGURE 7-1

A multiframe view of the organization for prospective DDOs

image

a. Lee G. Bolman and Terrence E. Deal, Reframing Organizations: Artistry, Choice, and Leadership (San Francisco: Jossey-Bass, 2013); Edgar H. Schein, Organizational Culture and Leadership (San Francisco: Jossey-Bass, 2010).

b. Scott Keller and Colin Price, Beyond Performance: How Great Organizations Build Competitive Advantage (New York: Wiley, 2011).

c. David Rooke, William Torbert, and Dal Fisher, Personal and Organizational Transformations (New York: McGraw-Hill, 1995); Frederic Laloux, Reinventing Organizations: A Guide to Creating Organizations Inspired by the Next Stage of Human Consciousness (Brussels: Nelson Parker, 2014).

d. Robert Kegan and Lisa Laskow Lahey, Immunity to Change (Boston: Harvard Business Press, 2009).

e. Myers-Briggs Type Indicator. See Isabel Briggs Myers and Peter B. Myers, Gifts Differing: Understanding Personality Type (Palo Alto, CA: Consulting Psychologists Press, 1980).

We confess, as the authors of this book, that collectively our natural bent has been toward the lower-right box (the individual interior), and from there, to the lower left (the collective interior). We have long been interested in the way the less visible issues (the lower half of the box) have been omitted from the leadership agenda and from the responsibilities management must take up if organizational life is to become what companies and their members need it to be.

In the language of a Bridgewater baseball card, we suggest you “watch out” for us in this respect. The upper boxes (the exterior elements) are not our strong suits. But we ourselves are on a learning journey. Our ongoing experience of the DDOs in this book has deepened our appreciation for the dynamic, interdependent relationship between the interior and the exterior. Still, we, like everyone else, are works in progress. You will see in the examples to follow that we still lean heavily in the direction of our preferences. Even so, we hope that, taken as a whole, the examples will bring to life what it means to keep all four boxes in mind as you consider your own journey in the direction of the DDO. We invite you to fill in your own entries in any quadrant that you feel we are giving too little attention.

Frazier & Deeter

“We need to talk. What you guys are describing about being ‘deliberately developmental’ is what our firm really needs.” Those were the first words that Seth McDaniel, managing partner of Frazier & Deeter, spoke to Andy Fleming (an author of this book). (For more about this firm, see “Frazier & Deeter in Its Own Words.”) Thus began an eighteen-month conversation and journey that eventually resulted in the firm hiring our company, Way to Grow, INC., to help design and support a yearlong pilot initiative titled “Lead FD.”

Frazier & Deeter in Its Own Words

Founded in 1981, Frazier & Deeter is a nationally ranked, PCAOB registered CPA and advisory firm that helps businesses and individuals succeed in a changing marketplace. We provide a wide range of tax, audit, accounting, and advisory services.

We are a nationally respected accounting firm:

  • Top 100 Largest Accounting Firms in the Nation
  • #1 Best Accounting Firm to Work for in the United States
  • Recipient of the Practical Accountant Practice Innovation Award for six consecutive years
  • Top 25 Best Managed U.S. Accounting Firms
  • Gold medalist of Top American CPA Firms and an Accounting All-Star by Bowman’s Accounting Report and Inside Public Accounting
  • The second largest independent CPA and Advisory firm in Georgia
  • Second Fastest Growing Accounting Firm among the Top 100 Firms in the United States in 2014
  • A firm committed to producing top-quality work, consistently going the extra mile to achieve great results

Source: www.frazierdeeter.com.

Why Become a DDO?

McDaniel explains how he decided to move toward a more deliberately developmental culture:

On the business side, the math is pretty simple. When we looked ten years out, we could see that a lot of our senior partners who drive the business today will be retired. In most CPA firms, succession doesn’t get a lot of focus, so when they lose their business drivers, they wind up having to merge with others. But we had made a decision that we wanted to be a legacy firm and maintain our name and culture. That was important to us. So if we were really serious, either we were going to have to hire a bunch of expensive senior people—and some of them wouldn’t pan out and would probably mess up our culture anyway—or we were going to have to get better at growing people who could become business drivers.

Note that McDaniel’s picture of F&D’s change story begins squarely in the upper-left box (organizational exterior): a clear business problem that needs addressing. And note that his story, beginning here, naturally moves to the upper-right (individual exterior), because collective needs implicate individual capabilities. McDaniel explains:

In a nutshell, we came to the realization that we needed to put as much attention into people development as we did into business development. In the long term, for a professional services firm, they really are the same thing. What resonates with us about the DDO concept is the idea that our day-to-day culture could serve as a catalyst for people’s development. That has a lot of appeal for our firm. We want to help people be better inside or outside the firm. We have a duty to help people progress.

For F&D, development begins at the beginning:

We also have a duty to be genuine in our recruiting—in our message and in the way we relate to people. If we’re going to talk about “growing with our firm,” we have to be able to back that up. With the quantity and quality of people we need to recruit, we thought that having a distinctive approach to development could set us apart and attract more of the people we wanted.

Most midsize CPA firms help their people develop technical skills, but they don’t do much to help them develop the more adaptive skills. They operate from an assumption that you either have them or you don’t. Every firm says, “We’ll help you grow,” but they don’t really help beyond the technical things you can learn in a book or a class, and I just don’t think you can learn something like leadership or “professional judgment” that way. The lessons you learn may stick for a month or two at best, and then you go back to doing what your existing culture says.

The DDO model works well with the industry in which F&D operates:

Then there’s the apprenticeship model, which most of the CPA world is built on, but there are no guarantees with that, and most of our existing senior partners made it on their own anyway. We decided that was too hit-or-miss, too much of a crapshoot. So unless we did something different, we saw a dynamic that younger people we recruited and hired who had the capacity to grow—some of their potential would go unfulfilled.

“Growing our people” for McDaniel, is not only a means of fulfilling the first business objective of creating a new generation of senior business drivers but also an end in itself—in effect, a second business objective: to make development itself an important part of the value proposition of working at F&D. This is the classic, expected profile for early adopters of the DDO idea—leaders and organizations that see people development as both means and ends of the business.

Then What?

McDaniel and his fellow partners collectively agreed that they needed to focus on developing younger people. The agenda was firmed up, but McDaniel knew he couldn’t simply mandate that the firm move forward with it.

So McDaniel asked one of us to make a presentation at F&D’s partners’ retreat on adult development (something McDaniel could have done himself and done it well, but he wanted to participate in the conversation and focus on his partners’ responses). He next decided to vet the immunity to change (ITC) method with the few select people who he knew would need to be advocates for the DDO approach if it were to take hold. McDaniel had one of us conduct an ITC workshop with those five people so that they could gain a better sense of what it would mean for the firm to become a DDO.

In other words, McDaniel took actions to build a home for the work to take place: discussing with partners whether to focus on growing younger people; exposing partners to adult development; participating in the retreat; and vetting the ITC method with a few people.

This is also where McDaniel’s story begins to move into the lower half of the four-box model. It is not only that he identifies a business problem, or that he sees that the business problem will make new demands on individual members, or even that he has a dual conception of the business problem that includes people development as an end in itself. He could do all these things and still envisage that the road from here to there is essentially a technical one, in which his central need is a good plan to get people on board to shift their behaviors in the desired direction.

But McDaniel’s earlier critique of the industry is, in essence, a diagnosis that his business objectives have an adaptive dimension, and this means that focusing on behavior without also focusing on the mind-sets that drive the behavior is not likely to succeed. This move from a focus on the visible behavior alone to the invisible interior is what moves him into the lower half of the model.

A Word on the ITC Map

We would never suggest that McDaniel’s chosen means—the ITC approach—is the only tool or must even be one among the various tools an organization will use. The immunity to change approach does play a prominent role, in one way or another, in many of the examples in this chapter, so perhaps a quick word is due as to why. The answer is not pride of ownership (two of the authors invented the approach), nor is it a matter of going with what you know best (collectively the authors might have a hundred years’ worth of experience with the method). We like the ITC approach because it is the most focused, most functional, fastest, and least costly way (psychically, for the individual and the organization) we have seen to get everyone engaged with her growing edge, in a fashion that links gut, mind, and hand (how you feel, how you think, and what you can do when you make that connection).

What is the most familiar alternative? It’s waiting until people screw up and then mining the valuable lessons therein. With the proper support, intentions, and focus on the interior (instead of mere problem solving), the mistakes people make can be a gold mine for a DDO. But as the central engine for producing internal learning opportunities, it has serious limitations.

First, it takes a long time for everyone to have a rich, working curriculum (you have to wait for everyone to screw up). Second, it costs the organization a lot to build such a curriculum. (Each person’s lesson plan is purchased at the cost of some kind of damage.) And for most people, the moment after they’ve done something wrong is not the optimal moment for learning. In contrast, the ITC approach quickly gets everyone out on his growing edge (aware of at least some of the demons he’s fighting and understanding how his way of fighting is producing his ineffectiveness) and without his having to do any damage.

So let’s return to McDaniel’s story. The outcome of the ITC session was that the group of five agreed to the firm moving further in its exploration to be a DDO; the yearlong pilot was hatched. The subcommittee next created a process to answer questions about whom to involve. In the end, the hope was that the ten people chosen would serve as a best case to test whether it was possible for F&D to accelerate people development in a way that would serve the firm.

The First DDO Practice

The program centered on ten selected professionals, representing many areas and levels, forming a developmental community to work on improving themselves, each other, and the firm. For the first four months, through the height of the busy season for accounting firms, participants focused mainly on developing themselves and each other by conducting and interpreting small, ITC-based experiments related to improvement goals in the context of their regular work. They met weekly in peer coaching pairs, and they talked regularly with an external ITC coach as well as a partner in the firm who served as an ongoing mentor.

In March 2015 (three months into the project), and then later in the summer, Andy Fleming interviewed McDaniel and three other firm members engaged with the initiative to hear their thoughts and observations on their experience so far. Collectively, the ten participants in the initiative reported more than a hundred experiments and twenty-five peer coaching meetings conducted in the first six weeks.

Why was there such engagement? What were they learning? Where did they see things going? Let’s hear from McDaniel and also from Beth Newton (director of people and culture), Susan Koschewa (senior manager, audit), and Charli Traylor (manager, tax). McDaniel and Newton are the primary overseers of the initiative—they’re the ones who have put their necks on the line to make it happen—and Koschewa and Traylor applied and were chosen to be participants in the group of ten.

The Journey So Far: McDaniel

In McDaniel’s words, “My big assumption is that I always have to have the answer, and I’ve done some experiments telling folks, ‘I’ve thought it through and don’t have an answer.’” He describes what happened when he acted against that assumption.

I’ve found that people don’t necessarily expect me to have the answer. A lot of times they’re happier to think through the question themselves or to think it through with me. And when I’m not carrying the burden of having to have all the answers to day-to-day challenges, that frees me up to work on more long-term strategic issues.

Right now, for example, we’re looking at a candidate firm for a possible merger, and I’m sending a team on an off-site next week to create a detailed merger and integration plan instead of leading all the detailed planning myself, which is what I would have done before. I’ve met with our team, and I’ll be there later to review the plan with the candidate firm. I’m actually spending the on-site day, instead, with some key people at a university where we would like to deepen some relationships that enable us to get to know and recruit more of their top students.

As an internal coach in the initiative, McDaniel has also learned about others’ big assumptions. One in particular is shared across the culture and has a direct relationship to the development of future business drivers. Here’s what he says about it:

I’ve learned that more than a few of our younger people have a lot of anxiety and misconceptions about business development. They think they are expected to be continuously networking with a lot of people they don’t know and somehow closing deals with them. Because that assumption has gotten surfaced, I’m able to share my experience that business development is not as complicated as it might seem. It really starts with building relationships with the people that you’re already serving. As I moved up, I found that the people who I had taken care of along the way were now in a position to hire F&D. I’ve started talking to our people about this. We don’t want them going to a bunch of meetings where they burn a lot of time and brain cells trying to network with people they don’t know.

So I’m seeing a lot of how our people think and where their developmental holes are . . . and where some of our cultural holes are, too. I’m excited to see the impact that this first set of ten people can have on the organization. Will they apply what they’re learning and help others, too? Will there be a multiplier effect? I like what I’m seeing so far.

Beth Newton, Director of People and Culture

In August 2013, Frazier & Deeter hired Newton as director of learning and development, a visible expression of the firm’s deep commitment to develop its people and culture. Newton says she joined F&D because she wanted to work on the DDO initiative, which, she acknowledges, presents a challenge.

I realize this is not an easy road for the participants or for the firm. I keep getting more confirmation that this is deep change—not just deep exploration. This is about deeply embedding a new thought process, a new way of thinking for people. I’m seeing that change in people I’ve known for a year and a half who had been trained to follow the rules and check the right boxes—even when it comes to their own learning and development—and I’m seeing them shift.

In a conference call we had with all ten participants after about a month, I heard them saying, “I’m not getting the process; I’m not seeing the end game. Is this worth my time?” They wanted to be hitting milestones related to their improvement goals immediately. Then at the checkpoint meeting we had a few weeks later, it was very apparent that they were starting to realize that the process was about their own learning at their own pace and using their improvement goals as a way to learn more deeply about themselves and that this was a very different way of learning for them. It was like a light went on for all of them.

Now if you could somehow add up all of the moments they’ve had with their teammates, their clients, their partners, and their staff when they’ve been more open, more aware, and more willing to look at things from different perspectives, I think you would come up with a huge impact on the business. As they continue to grow and we involve more people in the process, it will be fun to see where this goes.

Susan Koschewa, Senior Manager, Audit

My first improvement goal had to do with being less anxious and not always having to be in control of every situation. My big assumption about having to control everything at work and at home definitely held me back. My first experiments were at home—asking others in the family to take on some things I was doing. That helped me practice. Then at work I started experimenting with delegating more of what I would typically do, particularly when I feel anxious. And with my coaches pointing out ways that I could think differently about situations that cause me the most stress, I’ve started processing through difficult situations faster, not letting them keep me down. I limit the time I dwell on tasks—one partner coach says, “Done is better than perfect”—and I’m able to let go much quicker and operate much more efficiently.

In fact, I can directly compare what I’m getting done this year to years past, because most of my projects are repeat engagements. I’ve been doing them for the last five years and can see where we are in the deadline process compared to the year before . . . or to where we usually are. And right now I’d say we’re five or six weeks ahead of where we usually are. We have a lot more projects done; and if they aren’t done, they’re much further along than they would have been.

That’s good for me and good for the business, obviously, because I’m able to do more in a shorter period of time. But from my experience recently with a project that was definitely not in my wheelhouse, I can see another benefit for the business in addition to greater efficiency—more flexibility in being able to put people on projects where they’re needed, even if they don’t initially have 100 percent of the qualifications that would make them feel comfortable.

I recently got put on this kind of project, and when I reached different points of aggravation that would have typically slowed me down, I kept using the tools and asking myself, “How would someone else see this?” Without the tools, I would have stayed “locked up” emotionally longer. Instead I was able to project myself into other perspectives and actually deal with the situation.

Charli Traylor, Manager, Tax

In my day-to-day work, it is easy to get bogged down and have tunnel vision and to just focus on what I need to get done in a very narrow sense. It’s easy to get self-centered, particularly during busy season when everybody is under a lot of pressure. It’s easy to not consider the needs of others and how they are interpreting the world, to not try to look through other people’s glasses. But through “Lead FD” and the coaching, I have found myself thinking about how others are able (or not able) to do their jobs because of my actions.

For example, last Friday was the day before a tax deadline—my first deadline day as a manager—and everything was squeezed. I was running around like a headless chicken and needed to delegate a task on the fly to an intern (only with us for forty-five days), and I really cut corners in giving her instructions about this task that actually served a distinctive kind of client and need.

After I walked away, I said to myself, “She has no idea why I asked her to do those things; she has no context for understanding the real point of what she’s been asked to do.” I could have and should have taken the time to explain it—and it wouldn’t have taken that long—because this is something that would help her long term; this is something that she could be doing again and again. So I did get the immediate work done through her but went home that night thinking that I need to do a better job when I get that way—a better job of explaining things, giving others something they can use in the future.

So this is Monday and I haven’t gone back to her yet, but I will. I have talked about it with another person who was there who said to me, “I’m used to the way you work, but others aren’t.” So now I have a clearer view of how others experience me under pressure, and I have a real situation to attach it to.

The process of identifying big assumptions helps you see why you have that behavior—and when you see it, sometimes it seems really dumb . . . One of the big assumptions that drives my behavior is that I always assume that others are ahead of me (I didn’t have a lot of guidance when I was younger), and that leads me to set unrealistic expectations for myself. I shared that recently with a senior partner (my partner coach), and she questioned the idea that others are ahead of me and talked it through with me. That was really helpful . . . Now that I’m aware of my tendencies, I can go into stressful situations and be more cognizant of how I approach people and the work.

In the past, when I’ve had people who encouraged me and helped me do better and be better, that’s what has meant the most to me. Now I see the ten of us going forward to make sure that we apply the lessons of this program to developing others—and that this culture spreads throughout the firm.

The Way Forward

You can imagine that each of these people (as well as the other participants, if we were to hear from them) would say “yes” to our three characteristics that point toward a DDO culture: yes, they each have an edge—a personal growth goal or one big thing they’re working on right now; yes, they have a home—a community of people who are aware of what they’re working on and who care about whether they make progress on it; and yes, they have groove—a practice they are engaged in that allows them to be at work on their edge during their work activities. And because they have these three elements, they have begun to become the change they want to see.

Compared to XYZ, Inc., Frazier & Deeter is taking a slower approach to expanding its edge, groove, and home by using a pilot program. Whereas XYZ is using a top-down approach, starting with the CEO and the top six hundred leaders, F&D is using more of what we would call a middle-out approach.

What is similar, though, is that the two organizations’ choice to turn toward becoming a DDO does not mean committing themselves to moving all the way down the path to become a full-fledged DDO; nor does it mean that the entire company culture will one day resemble the developmental intensity of a Decurion, a Bridgewater, or a Next Jump. It does mean that F&D’s leaders are committed to enacting certain DDO principles and practices (and to creating some of their own) in a bounded way and to seeing what they might learn and what might emerge as the best next steps. They’re building their bridge as they walk on it, and several members of our team have been fortunate to accompany them.

Returning to the four-box heuristic and keeping ourselves honest, this example may bring to life both the upper and lower halves of the box, and the relationship between them, but with respect to the lower half, the emphasis is on the individual interior. Perhaps our next example can correct this a bit.

WellMed

“What’s our biggest fear? To be seen by other docs as having gone over to the dark side.”

“Yes, and to see myself as a traitor to my calling. To become too corporate.”

“I agree with that, but I think there is a whole other issue, too, more internal to our team. I think we don’t want to step on each other’s toes. We’d rather avoid conflict than surface it and engage it.”

[In mock outrage] “I vehemently disagree with that!” [group laughs]

“It’s a good list, but I can add another: I think we have way more authority than we are exercising. I think we are reluctant to claim the power we have and to act.”

We’re sitting in a conference room in San Antonio, Texas, with nine doctors in the middle of a relentlessly candid, daylong, collective self-examination of their performance as the physician leadership team (PLT) of WellMed Medical Management. The company, which specializes in health care for seniors, operates more than one hundred clinics in Texas and Florida, serves more than 250,000 patients and HMO members, employs more than two thousand people, and earned revenues in 2015 of about $2 billion.

What has always been unusual about the organization, since its founding by George Rapier, MD, in 1990, is that WellMed is a proudly physician-led company. Also unusual is that, in the past few years, increasing numbers of its top people are becoming accustomed to making their interior life a part of what they’re working on at work. The snippet of conversation at the beginning of this section may be unusual in any company boardroom. Among doctors it is a genuine rarity.

That day in San Antonio, Richard Whittaker, MD, leader of the PLT, summarized the doctors’ dilemma: “As a profession we are probably far more comfortable with others’ interiors—their bodies and their emotions—than we are, as a group, with our own. We’re the doctors, after all, the ones who solve other people’s problems. We don’t spend a lot of time looking at ourselves.”

What began as a series of private, individual coaching engagements has spread to the company’s key leadership communities. Members of the office of the CEO—which includes, among others, Rapier and Whittaker—have all created maps of their immunity to change, as has every member of the PLT. The company has begun to consider what it might mean to move further in the direction of becoming a DDO, but it is beginning to create what we would call home.

A physician-led company—especially a fast-growing one like WellMed—depends for its thriving on attracting a continuous stream of doctors who are willing to take on management roles, even as they continue to practice and maintain their identities as doctors. This turns out to be challenging on a number of fronts. Rapier is by now a widely celebrated physician executive, but he would be the first to tell you he had next to no preparation for the role when he started the company.

Medical school and the medical field are not great breeding grounds for building business capabilities (“Most doctors are lousy delegators,” Rapier says, “and not the best at holding people accountable, either”). What’s more, many doctors face a deep identity conflict when they take on an additional professional role, especially one about which, as you’ve seen, many may be ambivalent.

To get at this deeper level, people need practices (in our term, their groove) that help them get below the water line to uncover the deep assumptions that, unexamined, perpetuate inner conflict and ambivalence. The earlier conversation was part of a structured, facilitated process (by one of us) in which members of the PLT had the opportunity not only to uncover their limitations but also to better understand the way their limiting behavior serves a collective immunity to change. What were their collective hidden commitments? What were their collective big assumptions? You can see their collective ITC map in figure 7-2.

By making this mind-set visible to the group as a whole, and especially by revealing their (possibly distorted) big assumptions, members of the PLT now had the collective opportunity to do something about their limiting mind-set. Nine people were now in a position to take up Bridgewater’s favorite question, “Is this true?” Is it true that we must succeed all at once, that we are not permitted a learning curve? Is it true that building management capabilities risks abandoning medicine? The PLT had a collective improvement goal to be a genuine leadership team (and not merely a collection of leaders, each looking out for his own area of responsibility). There could be no more important goal for a group charged to lead a physician-led company.

FIGURE 7-2

Physician leadership team ITC map

image

To conclude this series of glimpses into getting started on the DDO path, we present two more examples. As the following organizations work on a smaller canvas (they are as much programs as organizations), they do not take us deeper into the complexities of the lower-left quadrant (the organizational interior), but each teaches its own lessons.

The first—Suncorp’s strategic innovation division—comes to us from our developmentalist colleague Jennifer Garvey Berger, sharing work she is doing on the other side of the world. It is an example of a newly created unit in a large corporation, working in a DDO-ish fashion and slowly radiating its approach into the bigger system.

Suncorp Strategic Innovation Division

Most floors in the Suncorp building contain what you’d expect: cubicles filled with people talking on phones; safety and other motivational posters on the walls; sign-in boards to track employees’ locations. Someone wandering by mistake toward the quarter-floor that houses the Strategic Innovation (SI) division, however, would see something different. There are no cubicles, only chairs on wheels, desks on wheels, and whiteboards on rails that slide in every direction to create walls, form work surfaces, and even display sticky notes reflecting the thinking of team members. The single permanent wall is covered with paintings created by the group over the past three years, each representing images of strategy, the future, or risk in the visual metaphors that were most resonant for their creators.

This is what home looks like for this fledgling DDO, a special division of financial services company Suncorp Personal Insurance, in Sydney, Australia. Begun three years ago as a strategic investment in the long-term competitiveness and resilience of the business, the SI division had one purpose: to introduce into the organizational DNA a different way of thinking about strategy and the future.

Its founder, Mark Milliner, CEO of Personal Insurance, had grown increasingly concerned about the risk of the status quo for a successful business as well as the threat of “invisible forces of change . . . not only reshaping the insurance industry of the future, but our world of the future.” Milliner was also passionate about the need for his leaders to think in new ways about the looming uncertainties. He says that this investment “was about futureproofing our business so that we didn’t wake up one morning and find we didn’t have a business at all or the world had changed around us.”

Suncorp Personal Insurance has a traditional strategy team and an enterprise risk management group to help the business make choices and mitigate risk, but Milliner wanted an internal function that would serve many business needs at once. Not only did he want the new division to think in new ways—to challenge assumptions and help the organization learn about change—but also he wanted the new division to seek out alternative business models and new ideas for meeting emerging needs, build relationships around the world with innovative thinkers who would become strategic partners, expand the capacity of leaders throughout the business to think in strategic ways, and continue to evolve the personal insurance business.

All about the Risk

To meet these goals, members of SI think about risk in unusual ways. Rather than focus only on reducing risk, people at SI consider how a given risk may usher in a new opportunity. In an earlier project, people from across the business began to imagine a series of possible futures that would have a disruptive impact on personal insurance. SI’s central task is to uncover and manage options for the company to consider in the event that one of those future scenarios occurs.

This means that members of the team must immerse themselves in future worlds that don’t exist—take the perspective of these future customers, imagine their future lives—and then create new possibilities in the present that might provide a bridge to those futures.

This taxing mental and emotional exercise requires capacities most people don’t develop in the course of their regular lives. They must deal with many competing perspectives simultaneously, constantly challenge their deepest assumptions, and use diversity and conflict as tools to unlock new ideas. They constantly work together to increase their capacity to make a different kind of sense. As a result, the team is trying to make its work, its structure, and its culture deliberately developmental.

As with the more fully realized DDOs at the heart of this book, the SI team members believe that there is no difference between developing themselves as people and getting their work done. Kirsten Dunlop, executive general manager of strategic innovation, had never heard the term deliberately developmental organization when the team was formed. But she was steeped in developmental theory, and she knew she wanted her team not only to think about new things but also to think in new ways. She didn’t know exactly how to do this; she calls what team members are doing “leadership in the nude,” as they practice on the edges of their own competence and comfort level.

Team members see their own ability to break out of the confines of their previous perspectives as core to thinking about the future of insurance (by thinking about the future in general) in new ways. They believe that the thinking and being patterns they brought with them are too constrained to offer something innovative. This means that development is imperative. Their theory is that a socialized perspective might be too locked in the confines of the current context to do the innovative work that’s required. Even a self-authored perspective is likely to be constrained in a single (albeit self-authored) set of beliefs about the world. At SI, workers lean into the self-transforming mind in their work and conversations. And given how unusual such minds are, they know they must support people to develop them.

Regular Reflection

On one early autumn April morning (we are in Australia, remember), the team members gather for a regular reflection day. The twenty-four of them sit in a large circle, with all the whiteboards pushed aside to make the biggest possible work space. In the circle are the core team—the twelve members of the division who are permanent members—as well as a group called the principals—twelve people who come from the business and are posted to SI for a year. (The latter arrive in groups of three every quarter, and so there are always a few people who are new and a few who are about to cycle off.)

The topic today is the burgeoning tension between the core team and the principals. No one is quite clear what causes this tension, but it’s beginning to get in the way of the work and slow the pace of the group. Rather than guess what the issue is or have a vague “team building” session, the SI team employs common practice here (as in other DDOs you’ve seen): members unpack their understanding by holding a series of fishbowl conversations.

First in the inner circle is a subset of three of the principals, talking about their experience of the difference in the two roles. They talk about their delight that they are getting to do this exciting and innovative work, their attention to the departure of several among them in the next few weeks, and their own anxiety about returning to their previous jobs.

When they pause, those in the outer circle express appreciation for the process of the conversation; they point to particularly good questions, particularly good listening. Some people point out what looks like an area of tension or discomfort.

The next round begins, with a few core team members joining the middle circle and some people pulling back to the outer circle to gain a different vantage point. The conversation deepens, and now people begin to talk about the power differential, about their confusion concerning who gets chosen to be on which so-called option teams, about how they’re finding themselves changing so fast that they’re dizzy with the effort. Now the tension that previously had been underground begins to bubble to the surface, and the participants turn it around in their conversation so that they can understand it.

In the first round, members in the outer circle were explicitly appreciative; in this round they cast a more critical eye. They ask about the way the inner circle members are enacting their values: How much have they been asking curious questions rather than making points? How much have they been listening to one another? How much have they been uncovering the real conflict? The issue of the option teams fades away as the central issue emerges: some people have a nagging fear that others are selfishly pursuing their own interests instead of doing what the team collectively needs.

This shows up in a topic that one principal calls “the dance between our roles and our personal development.” There is widespread agreement that the members are growing and changing, and their previous assumptions about the world are falling away before new assumptions are developed: “We’re growing so fast here, with little time to reflect on who we’re becoming.” They talk about how they’re more aware of themselves, of their weaknesses, of their strengths. They are redefining work, redefining leadership. “Now I see leadership is about how attuned you are to the people around you and the context in which you’re working,” one person says. “It’s less about deliverables—which I used to think was the whole point. It’s about the journey and not just the destination. I’m noticing what it’s like to really notice.”

There is widespread agreement that people are changing, but a disagreement emerges between, on the one hand, those who have a sense that the team and its work are primary and, on the other hand, those principals who sense that their own individual growth over the past twelve months is the most important piece. A relatively new member of the team says, “It has to be about me first. I have to slash my floaties [i.e., give up my inflatable swim aids], become more independent in my thinking and action than I’ve ever been before. I need to feel like I can’t swim, so that I have to keep my head up by myself. I have to focus on my own individual development before I think about what’s best for the group. I only have a year! First I need to swim before I can think of going back into my team and teaching them to swim.”

But someone else counters, “The point of the development is what we’re doing for the business. We’re getting better on behalf of what the business needs of us—we can’t focus just on ourselves.”

“That’s the point,” another member adds. “We’re paying attention to our own growth and development for the purpose of doing our work better. If the world were remaining the same, we could remain the same. If the world is changing and the business is changing, we need to change too, or we can’t take it forward.”

Reflecting on Reflecting

In the first round of the fishbowl, the conversation is fast and furious, and people seem to ricochet off the ideas of their colleagues rather than build on them. By the third round, the conversation has become slower and more reflective, and people listen more carefully. Even though the conversation is impassioned, they reach into the perspectives of those they don’t agree with, seeking to understand. They probe and ask clarifying questions: “Have I got that wrong?” “Am I misinterpreting what you said?” They watch the process of the conversation itself, with one member wondering aloud, “Hmmm. Am I just trying to deflect the conversation from a place that makes me uncomfortable?” And they track the changes in themselves, noting, “I could not have thought like this three months ago!” They are aware of the process and the content simultaneously, aware of their own reactions but less captured by them, able to deeply understand and consider the perspective of someone who disagrees.

Vital—and somewhat dangerous—issues are raised. “I’m really reacting to all this self-focus,” a member of the core team says. “Professional development isn’t for the self, isn’t supposed to be self-focused. It’s so I can do my job better!”

Someone cries. Someone else gets angry. But these strong emotions are not verboten here, and the group hands around a tissue or steps back to laugh together before pushing deeper into this important and difficult conversation. The ones who have been here for six months or longer find their rhythm relatively easily, even through the tension; the newer ones see what they will be able to do before their time in the group is up.

The conversation begins to weave together the individual and team development ideas, the personal and the organizational. The members close the fishbowl with a conversation about their purpose—individually and collectively, as members of families, communities, and this organization. They reconnect with the idea that insurance is ultimately about creating a sense of hope and security in an uncertain world—a concern they deeply share with their customers. They talk about the way insurance supports growth and risk-taking to create a better future—and it is sometimes the only space of comfort after a disaster. They share their belief in the organization and in the need to find new ways to protect what people most value.

The core team members wonder aloud what they can do to help amplify this shared sense of purpose; the principals talk about their need for personal support and reflection time as well as the stretch the job demands.

By the end of the ninety minutes, the people in the inner circle physically lean in to one another, their tone reflective, searching. The people in the outer circle have pulled their chairs tightly around the middle. They learn that none of their concerns is totally right, and none is unwarranted. They make a new pathway forward, together. The room almost vibrates with the new meaning being created there.

Later in the day the questions raised in the reflection meeting are deepened when the team members learn from their consultant insights from theory and research about power, development, and purpose, and the team experiences and creates developmental practices. They discuss the hidden assumptions that their ITC process has uncovered, and they unpack the team’s collective assumptions. They look at the various ways power and connection interact, and they practice listening deeply to the sense their colleagues make instead of the more common practice of listening to build an argument for what should happen next.

A Theory of Practice

This practice of mixing content with developmental practices on the team’s reflection days goes back to the beginning. As the team formed, the first off-site wove together ideas of complexity, an uncertain future, and adult development; the members’ first practices were about deep listening and honest sharing of feedback. Like the other fledgling DDOs in this chapter, the SI team members used the immunity to change process to discover their personal big assumptions and to find their edge. They also explored the edges of their own development using an individual developmental assessment, as they talked about what they were discovering about the benefits and limitations of their particular developmental stage.

Over time the team has created ongoing practices to strengthen its communities and support its development. Team members have created rituals to welcome new members and to wish farewell to those who are going. They think hard about the theory and practice of transitions, a practice that’s vital for a team always in transition. New members take the developmental assessment and learn about adult development—at the theory level and at the personal level. They create art pieces together to externalize the interior.

The principals who leave and head back into the business (now called pioneers) are supported with ongoing action learning groups, where they make sense of what it means to think about the world in new ways as they encounter old colleagues and challenges.

Spreading the Word

The strategic innovation team is a tiny island of twenty-four people in a sea of fifteen thousand in the larger company. And yet the SI team is beginning to see some of its practices and ways of thinking move into the mainstream as it transitions from a fringe group to a vital part of the capacity of Personal Insurance to create future offerings and expand its vision of the world.

In SI’s short life, it has influenced the larger ecosystem of Personal Insurance to make significant changes in the way people work. For example, the company has experimented with innovative approaches to employees working from home, with resulting extraordinary customer satisfaction, unprecedentedly low levels of absenteeism, and high sales performance. The SI team also led the company to create vital new partnerships (for example, with start-ups to codevelop pioneering and disruptive business models for insurance) and to adapt the model of the core insurance business to prepare for change. Increasingly, the SI team is called on to support innovative thinking throughout the business.

The team stands now at a crossroads as demand for its perspectives and time outstrips its current resources, and its next moves (should it grow? should it create little cells that live inside each area of the business?) will shape not only the developmental nature of the team but also, quite possibly, the developmental nature of the entire business. Will Personal Insurance become a DDO? Will all of Suncorp try this new approach? Perhaps we will learn the ways in which DDO practices create contagious effects that reshape an entire organization.

Or, indeed, perhaps many organizations will follow, as this next glimpse suggests—organizations as big and venerable as Coca-Cola, or as new as a freshly launched start-up.

Flashpoint at Georgia Tech

6:00 . . . 5:59 . . . 5:58 . . . 5:57 . . . The red-numbered digital clock counts down in front of you. You and your start-up team stand before forty smart and committed people who, for the next six minutes, want only to hear some fresh truth from you. What did you do this past week? What did you learn that you didn’t know last week? What truth can you now speak regarding customers and your business model? What will you do next week to gain more truth?

Every Tuesday afternoon in the open-space, write-on-the-walls environment of Georgia Tech’s Flashpoint—a first-of-its-kind start-up engineering studio (see “What Is Start-Up Engineering?”)—ten to fifteen start-up teams within a cohort group gather for the weekly master class. Amid scattered butcher-block tables and Aeron chairs, Flashpoint’s most dramatic ritual in a carefully constructed, deeply developmental curriculum takes place: brief presentations by each team on its research from the past week, followed (or interrupted) by questions and feedback. Led by FP director and founder Merrick Furst, a group of seasoned mentors and advisers gives candid, often critical, feedback that is intended more than anything else to be clarifying. “What did you actually ask?” “What did you intend by that question?” “How did they respond?” “What words did they use?” “What do you think they meant?” “What leads you to think that?” “What do you really know for certain?”

Novice and veteran entrepreneurs who want to create scalable, sustainable businesses populate most of the two- to five-person teams. The remaining attendees are product or brand managers and other innovation-related professionals sent by their respective companies to find untapped sources of authentic demand (as Furst would say) and, perhaps even more important, to explore how they might export FP’s models and methods to stimulate ongoing innovation in their home organizations.

What Is Start-Up Engineering?

Start-up engineering is a program and framework for finding authentic demand and building scalable companies to satisfy it. Start-up engineers work diligently to identify meaningful pain in customers’ lives, to distinguish it from the unmoored market theories entrepreneurs usually begin with and from the solutions customers themselves may imagine they want. These engineers generate theories about customer improvement goals and the constraints that prevent existing solutions from meeting them. They work to find actionable truth by testing to disconfirm their theories, modifying them, and retesting. They prioritize and gauge progress through a framework of understanding, bounding, and reducing the risks that all early-stage companies face.

The start-up engineering process takes approximately six months of full-time, committed work, usually by two or more founders. About two-thirds of the start-ups that implement the program succeed in discovering authentic demand during this period. On the bedrock of this discovery, Flashpoint helps manage start-ups through a process of shaping products and companies that will make money, in a reliable and scalable way, by enabling customers to overcome their constraints and attain their improvement goals.

Source: http://flashpoint.gatech.edu/startup-engineering.

The personal stakes are high for all participants, because most of them have become strongly attached to (and have invested significant time and money in) a particular idea or vision, which, they discover on a Tuesday afternoon or some other time early in the FP process, is almost certainly wrong. Here’s former FP participant Mario Montag—now founder and CEO of Predikto, a three-year old predictive analytics firm that recently raised $3.6 million in venture funding—on his first Tuesday presentation, in which he pitched what he was convinced was a “big idea” in the automobile financing realm:

I had been working on my idea for about six months, and when I presented it the first time at Flashpoint, I focused very intentionally and in some detail on what I thought was its huge upside and the tasks within it that we could do, thinking this would capture people’s attention and get them onboard. It was amazing how quickly experienced entrepreneurs were able to pinpoint a couple of doors I had only opened slightly and kick them down to reveal the assumptions we had made and the associated risks that were all too present . . . Even some of the smaller assumptions, if we couldn’t validate them and mitigate the risks, would lead us right off a cliff.

Assumptions that participants hold about customers, their business model, and themselves are challenged all the time at Flashpoint—during master classes, mentor meetings, weekly one-on-ones with Merrick, dialogue with other teams, and through formal and informal use of the ITC approach throughout the process—and sometimes even before the process officially starts.

Kevin Burke, senior global brand manager for the Coca-Cola Company, Glaceau (Vitaminwater, Smartwater), describes his team’s first meeting with Merrick during the application process:

We came in to our first meeting with Merrick with a very focused plan; we had a target audience, product, and approach. We were thinking that Flashpoint would just help us do it faster. So we wrote our plan up on a whiteboard, and Merrick got up and just erased the board clean. Honestly that really scared us. We were so immersed in what we thought the brand was. He said that if we were going to come into the program that we had to think more broadly and had to be willing to talk with consumers and listen in a new way.

That new way of listening and then acting is deeply informed by DDO and ITC principles. Who are your customers as human beings? What are their improvement goals, hidden commitments, and big assumptions? What does your product or service have to be in order to take their immunities off the table and help them become more of who they are? Whom do you have to become in order to make and deliver your product? What are your own immunities that you will need to overcome? How do we fashion a safe, reliable, and supportive community within FP so that people can absorb and use so much tough love, rather than being run off by it?

Burke talks further about FP’s central use of ITC to better understand customers and his own team—and the reaction of his managers back at Coca-Cola:

Like a lot of corporations, Coke is incredibly strong regarding data, but we all gather it and use it the same way. FP gave us the chance to do it differently. We interviewed people throughout the world and heard the same themes and then saw the big assumptions. The process then showed us what the new products needed to be and how we could make them internally without triggering big assumptions or by being able to respond if they do get triggered . . . What really helps get you immersed and better at ITC is that Merrick just lives it; he uses it even when you meet during his office hours. Where are you now? What’s the biggest thing that could kill you? Then he does a map with you related to that thing and you know what you need to do next . . . We’ve shared ITC with our managers back at Coke, and they loved it. They want us to teach FP tools to more people at Coke. One of our deliverables is to bring this into Coke.

So the developmental culture at Flashpoint may reach further back and further forward than in all the other organizations you’ve met so far. It reaches further back in a supply chain by using its own practices to more richly imagine the inner worlds of its participants’ anticipated customers. It considers a customer’s choice to try a new product or service as itself an adaptive challenge for the customer, and it puts entrepreneurs in the position of needing to manage the interior of the imagined customer, even as the organization itself is managing the interiors of the program’s participants.

The participants are invited not only to think about the mind-sets of their prospective customers but to identify the self-protective commitments and limiting assumptions they would need to help customers overcome before they can become customers. At the same time, FP reaches forward by instilling in these entrepreneurs a habit of mind they may take with them from the laboratory of the program into their fledgling businesses. In that way, Flashpoint may be an incubator not only of start-ups but also of more organizations with a developmental bent, even perhaps more DDOs.

Is this an accident? Hardly. According to Furst, implementing this new kind of practice, and building a community to support the practice, may be crucial to a start-up’s fate, to whether a dream becomes a reality. We’ll let him have the last word:

We walk around with these little theories that we have in our heads about the way the world works. And the world is just way more complicated, way more detailed, and we don’t notice that the world is not actually the way we think it is according to our little theories. The way we get disconnected from reality is we think the world works the way our theories are; we build things [products or services] to fit with the way it works according to our theories; and then we are disappointed or surprised when it turns out that our things fit our theories, but they don’t fit the world . . . What we found in FP is that it requires a mind-set change to be able to act like a successful founder. That mind-set change is not so easy to accomplish . . . You have to have a set of principles, you have to have a touchstone to ground truth, you have to have practices, and you have to have someone like me hitting you upside the head every so often to remind you . . .2

Even when you see the world for the way it is, and even when you know what you have to make, you and your team can’t change. And we have to address that also; otherwise, the teams don’t succeed. We found a way to create a developmental culture inside the teams that makes it possible for people to take an interest in each other’s immunity to change, and it seems to make all the difference in the world.3

What Do the Glimpses Teach Us?

We say at the beginning of this chapter that we do not think there is a single recipe or ten-step checklist for starting a DDO, but we hope these glimpses into organizations making their own first steps in this direction give you a sense of certain essentials to keep in mind. An overall impression that comes through for us is the need to work in several dimensions at the same time.

One way to talk about this is that getting a DDO started implicates “head, heart, and hand,” and all three must be in play to create the initiating spark. Let’s start with the head element. We have not crossed a fundamental threshold until work life engages your interior, until being at work directs your own and others’ attention not only to outward behavior but also to what is going on in your head—what you’re feeling and thinking, and the underlying assumptions that hold you in patterns of thinking and feeling that may prevent you from being the person you were meant to be.

At the same time, no one would want to work, or be able to stand working, in such a setting unless it invited your interior into the public space of work with the best of intentions, with a good heart. If an organization moves toward becoming a DDO simply because it deems it to be the way to get the most out of its people, then the DDO idea is little more than a new way to control people, to wring more return out of human capital. If there is not a robust, reciprocal enthusiasm for the ways the organization and its people help each other thrive, then the invitation to bring your interior into the shared work space moves toward forced confessional exercises in self-flagellating “self-improvement,” and the place will become toxic. No one can speak so enthusiastically and appreciatively, as they do in the examples here, about what is often an intensely uncomfortable experience unless they feel their own struggles are being consistently elicited, and responded to, with compassion.

Bringing the interior into the job, and with the best of intentions, is crucial, but it’s still more of a disposition than a visible, sustainable new way of being at work. The spark of creation can come about only through the combination of head, heart, and hand—reliable, repeatable practices, structures, and tools with which people and systems build and rebuild the culture every day.

Growing beyond Our Edge: The Organizational Interior

The four-box model is another way of getting at the necessity to keep your eye on several realms at once as a setting—and its leadership—moves, however far it will, toward being a DDO. There needs to be a clear reason—a business opportunity, a challenge, a threat, an unrealized aspiration—that animates the journey in the first place, and it needs to be crucial to the organization (the upper-left box in the model). Otherwise, the first time the journey hits a rough patch (and it will run into rough patches, from outside and inside), the organization will lack a powerful enough counterweight to withstand the forces pulling it back to the status quo.

That strong organizational purpose must then take expression in the working lives of each individual member (the upper-right box). Otherwise, you have lost the trees for the forest (“I love humanity; it’s people I can’t stand”). Two clusters of questions arise here:

  1. Do I, as an employee in this organization, feel excited about and invested in the goal of this new journey? Do I see what it can do for me?
  2. Do I experience how I (not only the leadership, not only the company) will have to change to further this journey? Will I experience new demands, expectations, definitions of my role?

Because these challenges inevitably are both technical and adaptive—for the organization as a whole, and for each of its members—the path toward a DDO needs to include the realms in the lower half of the four-box figure. What are the inner dynamics, collectively and individually, that might undermine even a genuine and widespread commitment to advance the journey? How do your groove (your tools and practices) and your home (your trustworthy communities) not only make the interior exterior but also help you—individually and collectively—to change that interior, to develop it?

A fledgling DDO must watch out for a tendency to hold on to only some, but not all, of these dimensions. That is as true for us as it is for anyone. We told you, at the outset, to watch out for our own tendency, as individually oriented psychologists, to overattend to the lower half, and especially to the lower-right quadrant, of the four-box model. That tendency may be reflected in the overall impression the glimpses give you about how to get started. We think the immunity to change approach, for example, is a helpful way to get everyone connected to his growing edge, for reasons we’ve explained. But we don’t mean to suggest it should be taken up without equally vigorous, simultaneous attention to the organizational, systemic dimension.

We gave an early draft of this book to all our DDO exemplars for their reactions and suggestions. Bryan Ungard, of Decurion, was concerned about the examples possibly giving this kind of misimpression. “ITC is not the problem,” he wrote. “It is a wonderful model, approach, and method that we intend to continue to use ourselves.” But Ungard was worried we were underrepresenting the kinds of hard, essential, complementary work suggested by the lower-left quadrant: “how to deal with power, how to change operations to ‘just one thing’ throughout, how to shift the culture in the face of external and internal legacies, how to face the inevitable coup attempts, how to face the trade-offs between current competencies and future needs.” Our glimpses may tell you less about this dimension because we are too early in the life of these respective stories, but more likely they reflect limits in our current ways of working with fledgling DDOs.

Building Your Home

For organizations taking early steps in the DDO direction, and for our own ways of being helpful to them, what might it look like to more fully engage and elaborate the lower-left quadrant, the organizational interior?

As we have said, every one of the five examples satisfies some threshold requirement on the upper-left side; there is a clear, motivating business aspiration each organization wants or needs to accomplish. Equally clear is the way these aspirations impose new demands and definitions on individual roles (the upper-right quadrant). Recognizing that we are in the presence here of adaptive challenges, it is then our natural bent to move down, into the interior, on the individual side. There may be nothing wrong with this, but if the organization wants to create a culture that will internally, organically meet these challenges (rather than rely on external help and “something extra”), it will need to work on the element of home.

Even the richest set of practices will not be organizationally self-sustaining unless there is a safe, dependable, collectively-ascribed-to “container” in which those practices will operate.

Safe means, for example, that when someone reveals her weaknesses and struggles publicly, she experiences an enhancement of her place in the organization rather than a diminishment. Safe does not mean people can expect to be accepted who are not working to improve.

Dependable means, for example, that workers can count on the practices and the ethos behind them to be a regular, daily experience of how things are done. It does not suggest that workers are never surprised, nor that they can depend on the security gained through mutual collusions and traded-on loyalties (“I can depend on your being on my side”).

Collectively ascribed to means that we have all made an uncoerced agreement to operate in this way. It is what we want to do, what each person has decided to do, what everyone wants to do. It does not mean “we all share one mind”; it does not mean a culture of groupthink. It does not mean there are no disagreements, but it means agreeing about what is up for disagreement.

For example, in a discussion trying to get to the root cause of a person’s poor decision, there can be all kinds of disagreement as to whether we have really gotten to pay dirt, or whether the person conducting the exploration is doing an effective and respectful job. But there will not be disagreements as to the value of our spending time like this, on what other organizations might consider mere personnel issues. There won’t be this kind of disagreement, because this is what we all collectively signed on for.

To be fair to our fledgling DDOs, you can see signs of this kind of evolution already in the Flashpoint and SI examples. No one at Flashpoint is surprised by the kind of grilling to which their business plans will be subjected. The newbies at SI get schooled by the veterans in “how we do things here,” and how we do things has a lot to do with cultivating processes that will better enable people to speak honestly, pushing beyond accepted wisdom and due deference. It is probably easier for SI to move quickly in this direction, being smaller, less complex, and more in the nature of a program than a company, but that doesn’t make its process less instructive.

One way or another, a safe, dependable, collectively-ascribed-to container for interior work needs to be built by any group, team, division, or whole enterprise that wants to cross crucial thresholds moving in the DDO direction.

Shared Norms, Agreements, and Rules

To our way of thinking, the necessary step in crossing this threshold is the creation of shared norms, agreements, or rules of the road oriented to the work of development.

It’s possible for an executive coach or a powerful leadership development program to create shared norms oriented to development that are sufficiently robust to sponsor powerful practices. This is a kind of home, but it doesn’t live within the organization. It is what we call a twentieth-century answer. It is also possible for the team or organization to create a strong culture with widely understood and agreed-to norms that have nothing to do with development (for example, a high-reliability organization, a combat unit, a surgical team, a group of air-traffic controllers). And people development can certainly take place in such organizations, but they are not DDOs. They are not deliberately constructed to make an organization and its people each other’s greatest resource for development.

For any group wanting to move in the DDO direction, it’s helpful to develop these kinds of norms by asking, “What agreements do we, as a collective, need to make in order to provide the conditions for each other to do this kind of interior work? What agreements will enable us, at once, to work ongoingly on our own development (a Better Me), and to support the ongoing development of our colleagues (a Better You)?” Looking at the typical features of a DDO in chapter 3 can be one kind of prompt for such considerations. For example, you might ask, “Do we agree that rank will not have its usual privileges?” This means that subordinates should feel responsibility to push back on their bosses when they do not agree or understand, and bosses will welcome, rather than take umbrage at, such behavior.

Nor should a group wanting to move further in the DDO direction consider that, in merely making these agreements, it is successfully banishing counter-normative behaviors. Will higher-ups ever get defensive about the push-back they will receive, or critical of their subordinates who deliver it? Of course! Recall the Bridgewater disagreement about the consultants managing consultants.

And when this happens, there should be no head-hanging and self-condemnation (“We aren’t a very good DDO,” “We don’t have what it takes to be a DDO”). The work of building, preserving, and enhancing home is not solely about making the agreements. It is about expecting their continuous violation and then deploying practices (themselves safe, dependable, and collectively ascribed to) to convert those violations into the organization’s curriculum. Then violations become opportunities for everyone, in an everyone culture, to learn (as the issue log serves, in the same Bridgewater example).

Unsurprisingly, we think one of the most effective ways for the wayward individual to use the opportunity for learning is to deploy the immunity to change map. For example, if I regularly have a hard time giving or receiving upward feedback despite agreeing to do so, it doesn’t have to live long as a source of self-recrimination. I can struggle well with it by acknowledging it is an adaptive challenge and engaging my hidden commitments and big assumptions. Recall the Bob Prince and Nora Dashwood examples from chapter 6; each of their collections of column 2 behaviors (“I don’t listen to others” and so on) can be taken as not only counters to their improvement goals but also as violations of shared norms or agreements.

To take our own medicine, in our own evolution in helping organizations moving in the DDO direction, it’s fair to say that we have overexercised our forehand (defaulting to our natural bent to lead with the individual interior). In this way we unintentionally have cast ourselves (and the organizations) back into the twentieth-century answer. If we don’t help the organizations build their own container for the interior practices, such as ITC and others, we become the “something extra”—good consultants on whom the organization depends. Should we withdraw, the likelihood the organizations will continue in their groove is slim (although individuals may), because we haven’t helped them build their own home.

Nor should we beat ourselves up about our (current) limitations. Everyone—the three DDO exemplars, the fledgling DDOs, and ourselves—should be given the chance to grow; and in return for that gift, each of us has the responsibility to struggle well, to work on breaking the earthy crust above so that our new green shoots can find the light of day. In our case, this could involve figuring out our own fear and loathing (the worry box in the ITC map) associated with exercising our backhand, identifying the self-protective commitments (column 3) that make our tendency to prioritize the individual interior over the collective interior (column 2) so “sensible” and “brilliant,” and, finally, uncovering and testing the limiting assumptions (column 4).

Work in Progress: A DDO 360 Assessment

To more strongly engage the collective interior and help you consider the agreements you may want to make, it can be useful to have a tool or a picture that lets you know where you are now in your home building and where you want to progress. To help ourselves—and others—better come to grips with the systemwide dynamics in organizations interested in the DDO journey, we’ve been working on a 360 assessment process to generate data-centered responses to questions such as, How developmentally rich is our culture at this moment? What developmental strengths can we start leveraging now to better develop our people? What are our biggest barriers to being more of a DDO? What gaps should we start closing first? What are the most promising pathways? How do we compare, on the edge, home, and groove dimensions, with more fully developed DDOs? What progress have we made toward becoming a DDO compared with the last time we took this assessment?

In figure 7-3, each of the three DDO dimensions (edge, home, and groove) is deconstructed into six features, for a total of eighteen subdimensions. Home, for example, includes the subcategories openness about the self, appreciating the whole self, psychological safety, leader vulnerability, view of conflict, and view of expertise. Respondents answer a series of questions (see “Sample Questions, DDO 360 Culture Assessment”) designed to elicit information about the respondent’s experience of each of these eighteen subdimensions.

This information creates a rich picture of the various levels of saturation within and across each of the three dimensions, a picture that can be compared to the composite profile of the mature DDOs. Data can also show how a given department or business unit compares to the overall organization’s scores.

FIGURE 7-3

Dimensions of a 360 assessment for DDO-ness

image

Sample Questions, DDO 360 Culture Assessment

(On a 1–5 scale from “Strongly Disagree” to “Strongly Agree”)

Edge

  • “I know my manager’s personal improvement goal.”

    (Subdimension: My growing edge)

  • “This company has a bigger purpose than just making money.”

    (Subdimension: Purpose)

Home

  • “I feel safe telling my manager when I disagree with what he or she thinks.”
  • “People here say what they really think only behind others’ backs.”

    (Subdimension: Openness about the self)

  • “My boss is open about it when he or she makes a mistake.”

    (Subdimension: Leader vulnerability)

Groove

  • “On my team, when something doesn’t go right, we take time to talk about why.”
  • “I’m expected to tell the members of my team if I think we are doing our work the wrong way.”

    (Subdimension: Process improvement)

  • “In this company, people’s official job duties change often.”
  • “This company expects you to keep taking on new challenges at work.”

    (Subdimension: Role matching)

An Ongoing Process

“How can I get to Carnegie Hall?” the cab driver is asked. The answer? “Practice, practice, practice.” It’s an old joke.

Bridgewater’s Greg Jensen says that sustaining the culture is like going to battle every day—a continuous fight. Charlie Kim, at Next Jump, talks about playing the long game. Christopher Forman, of Decurion, invoking Aristotle, sees building character—in an individual or a group—as a lifelong activity.

What we’ve tried to do in this chapter—in this book—is to help you, if you’re considering the DDO direction by providing you, not a recipe or a checklist, but concepts, tools, and living examples to assist you in taking up a way of becoming, a way of carrying on, that needs to live as long as the DDO itself.

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