Freedom, Inc_ - Brian M. Carney [78]
WHAT WENT ROTTEN IN THE
KINGDOM OF DENMARK?
Oticon’s case is widely studied in business schools around the world. Whether that’s because traditional managers find comfort in the failure of Kolind’s grandest ambitions is hard to say. But like Sun Hydraulics—another company popular in business schools—Oticon is more studied than understood. So let’s take a closer look at what went wrong.
At the beginning, Kolind did a lot of things right. Indeed, Oticon’s liberation campaign has striking similarities with many others in our book. For example, its organization around projects initiated by “natural leaders” is much like Gore’s. Its elimination of the middle-management layer is similar to FAVI’s approach. Its paperless office is reminiscent of USAA’s, and its office layout and design resembles Richards Group and the Finnish company SOL, as we’ll see later. Yet, its most fundamental similarity is not with all other liberation campaigns that succeeded but with one that initially did not—UVA.
Like Jefferson, Kolind tried to launch his liberation campaign with senior managers (or professors) who were not convinced of the project or of the need to change their ways. Kolind had seen from his first day that Oticon’s senior management enjoyed a clubby, comfortable existence. Even in hard times, they had clung to their privileges. But he did not remove them from their positions of authority. Instead, he made them “an offer that they couldn’t refuse,” at least openly. Then, as members of the Products and Projects Committee, those same managers didn’t behave like the sponsors they had supposedly committed to being, but as the same old “bosses” under a different name.
What’s more, they made their decisions with ever-changing criteria and without bothering to explain them to the people affected—like too many “how” managers, they didn’t feel that they owed their people those explanations. This was not only disheartening, but it led people to wonder what the company’s vision was and what their “charge” was in pursuing it. Moreover, Kolind was officially a member of the Products and Projects Committee, and so some of the blame for its actions was directed at him personally.
In other words, the culture Kolind built had many—even most—of the characteristics of a liberated organization, but it was missing some features that are critical to maintaining freedom in the workplace. Oticon’s vision was neither sufficiently clear nor owned by everyone. And critically, neither the CEO nor other key leaders in the company took it upon themselves to ensure that people both understood the company’s vision and understood their role in pursuing it—their “charge,” in other words. The result was both natural and expected: People started to pursue their own goals. This often led to pushing one’s project at the expense of others for no better reason than it was one’s own project, lobbying the Products and Projects Committee for resources and visibility, and the rest. Kolind had wanted projects to compete but what he got instead was the “rule of the jungle,” as Vertex’s Westphal called it. The Products and Projects Committee, which was supposed to help orient activity toward the company’s goals, instead became the locus for lobbying and internal competition—the inevitable higher bureaucratic layer to resolve lower-level conflicts. And the more power it wielded, the more it attracted people’s effort and attention, and so distracted from the work they were supposed to be doing. People began to measure their success by their ability to commandeer resources from the committee, rather than by their impact on the company’s business or bottom line. As one employee put it, “You end up in situations where you act in some sort of anarchy and steal resources that others control.”32 Employees knew that something had gone wrong, but without a management that was ready to listen instead of tell, they lacked an outlet to express frustrations that