Moving Toward Teal Company’s Workflow - Agile Blog - Riter

Moving Toward Teal Company’s Workflow

The world is changing, and traditional management processes often don’t allow companies to stay afloat. To successfully compete with existing organizations, they’re looking for new ways to organize their workflow. No one continues to be surprised by impressive social packages, high bonuses and other material goods — today’s employees are more interested in new challenges and opportunities for personal growth and development. The widespread lack of motivation among staff harms companies even more than business of their competitors. Remote work and flexible scheduling become increasingly frequent in descriptions of vacancies. A promise of discretion, exciting projects, and a friendly atmosphere are the only things which can lure talented specialists to your team. Against this background, interest in teal companies is predictably growing.

So, what is it? A teal company, also known as “an organization of the future” and “a living organization”, is a successful advanced company that has abandoned habitual priorities — quick enrichment to the detriment of employees and customers — for the sake of long-term perspectives and development. They replaced management and total control with coaching and self-organization, KPIs — with common goals and values. Teal companies bet on people as the basic unit of the company, its driving force, but not just a weak-willed gear in a complex machine of bureaucracy.

Successful teal companies exist in medicine, industry, commerce, services, non-profit sector, but as a software development team, we are primarily interested in the IT field. It has previously differed democratic views and approaches to team management and cooperation, so it’s not surprising that teal companies are not uncommon here. The spirit of teal companies is especially familiar to remote teams, small IT companies and startups where there is no room for bureaucracy and the enthusiasm of employees comes first. However, famous giants of the industry have also succeeded in following this trend.

What color is your company?

In 1966, an American professor of psychology Clare W. Graves proposed a theory of adult human development, later known as Spiral Dynamics. According to this theory, a man in his development climbs the “stairs” where each step is assigned with its own color. Later the theory was adapted for managers by Chris Cowan and Don Beck.

In 2014, Frederic Laloux “painted” existing companies by analogy. In his book “Reinventing Organizations”, the author has identified seven stages of development through which all organizations around the world have gone. The last five, which still exist, are: red, amber, orange, green, and teal organizations.

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  • Impulsive-Red. This is a type of organizations adapted to chaos when there is no strategy, but there is a focus on the current needs, there are no plans, but there is a quick response to the threats of the current moment.

  • Conformist-Amber. In such organizations, planning and implementation of plans are strictly divided: decisions are made at the top, execution is at the bottom of the hierarchy.

  • Achievement-Orange. For this type of organization, changes and innovations are not a threat, but an opportunity, and people receive status difference thanks to their abilities and traits. This class speaks of organizations as machines.

  • Pluralistic-Green. This type uses the metaphor of families instead of machines. Personal relationships within a group are more valuable than results, and the benefits to the world are more important than own benefits.

  • Evolutionary-Teal. The highest level of development of an organization, “an organization of the future”, “an organization as a living system”.

The first teal organizations appeared about 30 years ago, when people were tired of total control of managers and internal competition. Now the number of such companies is growing. Teal organizations have taken the best parts of orange and green ones: from orange organizations, they got the desire to compete with external companies, from green ones — the desire to be a team. As examples, Laloux had found and described successful organizations with astounding financial results and growth rates, and called them companies of the future. A common feature of these companies is a great freedom of action in decision-making by employees. They have no managers, and employees themselves determine what to do, based on a common goal and a clear project vision.

Main features of teal companies

By Laloux, teal organizations are moving toward 3 main principles: self-management, wholeness, and a deep sense of a long-term purpose.

1. Self-management.

In team companies, there’re many rather small autonomous teams working independently on projects which they often choose themselves. Each employee determines priorities, chooses tasks and estimates time himself. There’re no managers there — they have coaches instead. The coach can give advice or share the experience of other teams. They are necessary to keep up communication between autonomous groups of people. For the most part, the role of a coach is to ask right thought-provoking questions which help the team to find their own solutions.

Meetings are held only when they are really needed — to discuss and make joint decisions. They are organized in a democratic way, everyone is given the right to speak out, everyone must be heard. High freedom of action implies a greater responsibility for making decisions by the team, but mistakes are accepted as normal, they are learned from. There are no “bosses” in the ordinary sense in teal companies: of course, a company still has an owner, but the principles of workflow organization, including self-management, must remain unchanged without exceptions if the owner wants to benefit from them.

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2. Wholeness.

In traditional companies, it is usual to keep work and personal life separately. As soon as you come into the office, you’re expected to forget about everything except your direct duties. At work you are, above all, an employee, and only then a living person with all your personal problems, needs, and desires.

However, this approach is fundamentally wrong. People can’t split up work and life, they are parts of a whole, and teal companies accept this. For example, in team companies employees are able to take their children or pets to the office, dress and arrange their workspace at will. Employees of teal organizations maintain good relations within teams, support each other and this does not prevent them from carrying out their main work.

So, teal companies create an environment wherein people can not only develop and achieve their potential, but also fully express themselves, bringing high levels of energy, passion, and creativity to work.

3. Evolutionary purpose.

The first two principles would be useless without the third one — a clear vision of the common purpose and the path of development by all teams of the company. However, this path is not enforced “from above”, by the management of the company. Development goals and strategies are determined by the needs of society and customers, teal companies strive to positively influence the world, and not just to get rich by any means. Paradoxically, by focusing less on own benefits and revenue, they generate financial results that outpace those of competitors.

“We don’t own or run the organization; instead we are stewards, listening to where it needs to go and helping it to do its work in the world.” — Frederic Laloux

That’s how teams are able to stay autonomous: they choose projects and tasks on their own, but they do it in such a way as to bring the maximum benefit to the company, to find the best use of their skills and talents. Employees see the goal and are looking for the best ways to achieve it.

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In addition to the main principles described by Laloux, there are several other usual features of teal companies:

  • Decentralization. The problem is that a vertical hierarchical organizational structure of traditional companies does not scale well enough. Therefore, it is ineffective. A teal company has a flat organizational structure which is easy to scale.

  • Full openness and transparency. Nobody withholds anything from customers, employees, investors, and partners. That helps teams don’t weaken and be sure that they are on the same page.

  • Equality and independence. Decisions in teal teams are made by any person who is ready to take responsibility for it. They use a multistage process of conflict resolution, and when a problem arises, the team solves it together.

  • Focus on people and values. People in such organizations think of their companies not as mechanisms or machines, but as living organisms with a soul, capable of developing in the right direction without management control and strategic plans for years ahead.

“A teal company does not develop the business, but raises people who develop the company.”

  • Self-realization and development of employees. Teal organizations are aimed at ensuring that everyone involved in the decision-making phase feels like an entrepreneur. It helps to form a strong team, to establish information exchange and to involve employees in the search for prospective solutions. Employees do not just perform routine work but are part of a team whose success depends on their personal contribution. When a person is attracted to the decision-making process, when the team is interested in his opinion and personal experience, an employee ceases just to sit back at work and waste time. He begins to be interested in the affairs of the company beyond his direct duties to become more useful for it.

  • Trust and high level of personal responsibility. Teal companies are built on the foundation of mutual trust, and when trust grows, responsibility grows as well. Teal organizations can’t exist without these two things, but when they are achieved, introducing teal principles should not be hard anymore.

  • Minimum bureaucracy. Discard the formalities and unnecessary waste of time on numerous meetings, reports, alignment processes, and other bureaucratic things. Do not impose a dress code and other restrictions without the need. Do not force employees to sit out hours in the office if the work is done. Implement flexible working hours and remote work when possible.

What is your benefit?

Teal companies give a number of advantages not only to employees but also to the companies management.

1. Benefits for developers

In a teal company, a team feels responsible for building long-term strong relationships with customers, and this greatly enhances their engagement and satisfaction with the job. They choose projects that are interesting and useful for their personal development. Loyal management and a pleasant working atmosphere allow employees to feel comfortable at work, easier to cope with complex and tedious tasks. With teal organizations, employees can not only get a salary, but also work for the benefit of the world, create something really worthwhile instead of imposing one more useless consumer product to society.

2. Benefits for company owners

A refusal of red tape leads to the fact that the company is growing faster than its competitors. Moreover, the teal approach allows uniting knowledge and experience of the whole team. At first, it may be difficult not to control everything yourself, but when you stop considering yourself the most intelligent one and supervise everyone around you, people start thinking for themselves, suggest own ideas and solutions. Teal companies create conditions of work in which smart and responsible people reveal their potential, while weak character, lazy and stupid employees are eliminated in a natural way. You lose some part of a team but make it more reliable and robust. A teal management style is not chaos and the lack of regulations. This is a rejection of the stereotype that every person is necessarily lazy and unable to do good things without constant supervision.

3. Benefits for managers

In teal companies, there’re no managers in a usual sense of this word. They have coaches instead. They are needed to ensure strong communication between different teams. Their experience and knowledge are still important to the company, but now they don’t have to accompany each step of the team. Responsibility is split between all employees equally. In addition, conflicts between managers and developers (due to excessive bureaucracy, constant reports, deadlines, estimates, etc.) disappear since no points of discontent are left, only fruitful cooperation remains.

Is teal the new black? Today’s teal companies

Critics and skeptics have not spared the concept of teal companies. It is not surprising: a lot of questions and doubts appear when you hear about it for the first time. However, this is not a myth or utopia, but an examined by a long-standing practice model of cooperation, allowing you to work not only more efficiently in terms of profit, but also more interesting for all participants. Such companies already exist, and those we know about are quite successful.

The principles and values of teal companies are shared by Google — the most powerful and valuable brand in the world (according to BrandZ and Brand-Finance). Google was recognized as the company with the best reputation in the United States, ahead of Microsoft, Sony and many other companies.

Facebook — with its strong corporate culture and team spirit — also strives to teal. According to various sources, it is the best employer in the United States, the best workplace among US companies.

One more example — Medium — a platform for social journalism. The service was launched in 2012, and by 2014, the Medium monthly audience reached 17 million people. The company is one of the most prominent representatives of teal companies.

Teal principles are also close to the team of GitHub — the largest web service for hosting IT projects and their joint development.

A classic example described in the Laloux’s book is Valve — a game development company located in the USA, an author of such computer games as Counter-Strike, Half-Life, Dota 2. Their most well-known principles of workflow organization are:

  • no one joins the project as instructed “from above”;
  • there is no leadership in the generally accepted sense, that is, there are no “boss-subordinate” relations.

“When you give smart talented people the freedom to create without fear of failure, amazing things happen. We see it every day at Valve” — the Valve team

Of course, other people’s examples are one thing, but when it comes to your own practice, many questions arise. You can provide your team with self-management, but that does not guarantee good results and decisions on their part at once.

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First of all, if you’re not sure, you can act in stages, introducing only part of the teal principles. Maybe you have already recognized your company in some of them. The main thing to remember is that there are no (and should not be) uniform standards: principles — yes, but not standards. And it is better to start with the Laloux’s book, where various situations are already described and many questions will immediately disappear. Here is also another good site for getting acquainted with the main teal ideas.

Teal companies workflow: special needs and conditions

Of course, not everything is as smooth as we would like. It may require a lot of efforts and several unsuccessful attempts before you manage to organize everything exactly as intended. You may encounter resistance from managers and even lose some good employees who don’t want to understand and adopt new principles. This is a complex path that requires awareness, time, and contribution of all the participants in the process.

Company owner’s role

The process of transformation itself requires a radical change in the ways of thinking, primarily on the part of top management. This is the most difficult part since this is not what you were taught in business schools. Even if, in words, you agree to teal principles, in fact, you may be not ready to pass the reins off to the team. Even if subconsciously. In practice, a company owner is responsible for:

  • providing the team with a clear project vision
  • rejection of bureaucracy, keeping everything simple and transparent
  • freedom to express thoughts, everyone should be heard
  • no orders “from above” and subordination, just advice and coaching

Hiring right people

Teal companies impose special requirements on employees:

1. Self-reliance and self-organization.

Teal workflow involves a broad discretion to employees, that’s why you should encourage independence and responsibility of developers. The teams need to manage themselves most of the time, make their own decisions, cope with difficulties and stay organized without any effort on the part of management. Some developers aren’t able to work without any control and stay productive all the time. Or they may be good programmers but incapable of understanding project goals and needs. Get rid of such people, otherwise, your teal company won’t succeed.

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2. Work enthusiasm and trust.

A teal company requires a high level of trust between company owners, developers, and managers. It may be difficult to ensure that employees really stay productive without constant control, reports, and meetings, however, you really don’t need to. A passion for work is the main and enough guarantee that a particular employee will be able to concentrate on his duties regardless of working conditions, loyal management, and self-organization. Look for good employees who can be trusted to do the right things even when nobody is observing.

2. Good communication skills.

Although communication among autonomous teams is much less frequent, this only imposes greater requirements to their communication skills. Remember, they have no compulsory daily meetings without a special need, no constant reports where they explain to managers what they have done, etc. Moreover, each team and employee can decide independently what to do next, which task should be implemented, what project they want to join. A weak interaction and poor communication between autonomous teams would make it difficult to understand what is happening next door, not to mention the company in general. That’s why teal teams should communicate just to stay on the same page, update project vision, and discuss development strategies.

Specific management process

When a company owner and a team are ready to deep into the teal project management, you need to discuss and restructure business processes in the company:

  • Think about the transparency of all the processes in the company. Organize the workflow with general awareness, discuss work in the same environment where it is performed, keep all project data together and public.
  • Avoid unnecessary meetings and other bureaucratic things. If the previous condition is met, it must not be a problem.
  • Focus on people and their needs: free formation of teams, independent choice of tasks, lack of strict time frames, and so on. Your main goal should be not a quick profit, but the development and growth of the potential of employees in the field where they are most useful.
  • Maximum autonomy of teams, including an independent choice of development tools, in the interests of developers, not only managers.

Thus, the formation of teal companies should be carried out by forces of all team members. As for the new workflow, the right project management tool can greatly help in its organizing.

PM tool for a teal company

Of course, most of the ideas of teal companies are in the minds and behavior of people, and no tool will turn you into a teal company without your consent and aspiration. But it can help to steer your project management process in the right direction.

A project management tool for a teal company is different from a tool for a not teal one. It’s enough to look at current solutions, for example, Jira, Trello, etc., to understand that they are not suitable for teal teams. The main shortcomings are:

  • users are strictly separated by their rights and roles in the team: there are managers who control the workflow, assign tasks, specify deadlines, and control results, and there are developers who work on projects, accepting the established conditions and restrictions.
  • high level of bureaucracy: specify this value, fill that field, evaluate the task, prioritize, assign, schedule, etc., and it doesn’t matter whether you need these fields and parameters or not — you often can’t just miss some steps when using your project management software.

And what do teal teams lack in current project management tools? Probably the following things, though the list can be expanded:

  • free access to all projects of the company, independent choice of projects and teams to work with.
  • maximum freedom of action in the project for all team members.
  • maximum transparency over the actions of other users and teams, accessible not only to managers.

Our experience and contribution

To be honest, when we started to make our own project management tool, Riter, we had no idea about the existence of teal companies, not to mention their needs. And in any case, it was initially developed for our own company, that made it primarily focused on the work of small remote teams.

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But the popularity of teal companies has finally reached us, and then it turned out that Riter is quite suitable for their purposes. Perhaps because our company itself partly follows the principles of teal companies, even if we had not realized this before. Perhaps because remote software development teams basically tend to follow some of these principles — minimum bureaucracy, flexible hours, maximum openness. After all, teal companies are not a whim or a desire to follow trends, but the demands of the market which we are bound with. Small companies are open to innovations, easier to change, and often grow faster.

But whatever the reason, we see Riter as a teal project management tool. Here’re some teal principles we adopted in our company and software:

  1. Openness and accessibility of the workflow to all team members.
  2. Maximum self-organization, based on the consciousness and responsibility of employees.
  3. Flexibility, minimum restrictions and requirements on the part of the tool — we have customers for this.
  4. Company owner’s role is minimal — this user is only responsible for registration of the company in Riter, the rest can be done by the team (developers and managers) independently. An owner can still remove a manager from the system, but until then they will be equal in their rights.
  5. Moreover, a manager’s role is rather close to a developer’s one: this user is just a developer with some additional rights. All developers can be appointed managers, after that, all teams will be completely self-organized.
  6. Even without managers’ rights, developers get a high level of independence in Riter. They can participate in task management and time estimation, assign themselves to tasks, both developers and managers get all necessary tools for tracking projects, teams, and statistics. We are confident that this democratic approach will allow to efficiently use the company’s resources and avoid wasting time on numerous meetings and disputes. We also believe that every developer in a team is a responsible and motivated person who can perform his or her duties without additional control.

Of course, Riter is not yet an ideal solution for teal companies, but it will definitely move in this direction. The future of the project management is teal, and we strive to be the part of this future.

What to read next:

  1. Evolution and Agile
  2. Choosing Project Management Tools: Who Has the Decisive Voice?
  3. Collaborative Task Management Means Fewer Meetings
  4. 5 Reasons to Let Your Team Work Remotely
  5. Managing a remote team with high performance