Freedom, Inc_ - Brian M. Carney [11]
And the gloves were only the beginning. The more he looked around, the more of these bureaucratic false economies he discovered. Based on these early observations, Zobrist concluded that if FAVI remained set in its ways, it was headed for extinction—or to China. And, in fact, that is precisely what happened to much of the old-line manufacturing in Europe during the time that Zobrist ran FAVI. But Zobrist had other ideas. And under his leadership, the company has thrived where others have failed.
He eliminated the time clock because employees “should work to make products, not hours.”7 At the same time, he eliminated overtime pay while raising salaries to the level of one’s total pay over the previous year, for the same reason. Zobrist captured his leadership philosophy with a distinction. There are, he said, two kinds of companies: “Comment” in French, or “how” companies, and “pourquoi,” or “why” companies. “How” companies spend their time telling workers how to do their jobs—where to place the machinery, when to come to work and when to leave, and so on. This has two consequences. The first is that you end up judging employees by everything except what counts, which is whether the job gets done and the customer is happy. The second is that it becomes difficult, if not impossible, to change any of the myriad rules about how to get things done. You want to move that cart to a different spot on the shop floor? You need clearance from your manager, who may have to ask his manager, and so on, creating a never-ending “chain of comment.” The result, as Zobrist put it, is that it becomes impossible to get the work done without disobeying somebody in the chain of command.
A pourquoi company is different. It replaces all the myriad “hows” with a single question: Why are you doing what you’re doing? The answer is always the same: to keep the customers happy. As long as what you do satisfies that commandment, Zobrist doesn’t worry about how you do it. Freedom at FAVI meant replacing the chain of comment with a single pourquoi.
Getting there wasn’t easy. Zobrist smiled when he recalled how his newly liberated employees still gazed wistfully as they passed the blank space on the wall where the time clock used to be—and where some of them used to hang out in advance of the shift-ending bell so that they could be the first to punch out and head home. But even more than the shop-floor workers, Zobrist had problems with the middle management. He tried winning them over, but they—conscious that with everyone set free on their own initiative, they’d have little left to do—wouldn’t budge. Eventually, he dispensed with middle management altogether, moving supervisors to other roles more beneficial to the company while leaving their salaries intact. He eliminated the human resources department, too—because, he said, humans aren’t resources, they’re people.
In place of the supervisors, he organized the shop floor into what are essentially self-directing teams of two dozen or so. Those teams each serve a particular customer with a particular product, allowing them to become intimate with the needs of the clients they serve and to see directly whether they are happy—or not. And they approve candidates for the leader’s role, whom they can also depose. Those leaders report to Zobrist—about as flat an organization as you could ask for.8
The results have been extraordinary. For twenty-five years, FAVI has been able to reduce prices by 3 percent a year on average and has never been late with a delivery, allowing it to remain competitive in an age of globalization. It remains a European leader in its sector—half of all cars built in Europe contain gearbox forks from FAVI, an unheard-of market share for an auto-parts supplier. It has bought out its last remaining competitor on the Continent, introduced breakthrough brass products, such as electric rotors, in totally new markets, and—unlike its now-extinct European competitors—FAVI actually exports parts to China. And regarding the economic downturn in 2009, FAVI’s