by Paula Thornton
June 12, 2009 at 8:44 am · Filed under
2.0 Business Model, Business Model, Enterprise 2.0, FASTforward'09, Innovation, Organizational Design, Social Work-net-ing, Socialprise
Just before flying home from FASTforward ‘09, in February, I took advantage of being in Las Vegas to visit Zappos, an online retailer that has been repeatedly recognized for its unique culture (not to mention their own book on the subject) and embracing social media. CEO, Tony Hsieh, was even on Oprah last October. So what more could I possibly add here?
I focused ‘between the lines’ and ‘outside the box’ — the larger experience of what makes Zappos, well, Zappos. I’ve watched a lot of videos about the place, follow Tony on Twitter, and even did a brief piece on them before, but as with other 2.0 experiences, immersion makes all the difference.
The ‘get to the chase’ version:
- The Zappos environment is a full-blown corporate anomaly: full of things that most corporations would dismiss as being “unproductive”, “chaotic”, “unmanageable” and “unprofitable”.
Between the Lines: Note on video…the flags on poles…critical artifacts of the culture.
- People LOVE to work here (earning a spot on Fortune’s coveted”100 Best Companies to Work For” 2008 list). Why not? They get to follow their passions (even if they want to invite Ellen to come to Zappos) and evolve their own path of doing ‘work’, all while having LOTS of fun.
- The results: 2008 sales = over $1BIL
- Bottom Line: This crazy stuff works and they’ll even tell you how to do the same.
The ‘insights’ version:
- The Zappos experience begins way before the on-site tour. Even vendors coming on sales calls are picked up in Zappos-branded vehicles (3 SUVs and a bus in the fleet) at the airport or their hotel.
- My driver, Zack, was the Shuttle Manager. He was eager to talk about just how much he loves the company and its culture (even as a New York transplant). He worked his way into his job because he just likes to drive, which he sees a lot of: 4-5 drivers make 150-200 runs a week!
- During major conventions shuttle runs get a bit hectic, but Zack was proud that they were able to ramp up and cover 300 runs during the February 2009 CES convention (having a work culture that allows them to tap into volunteers throughout the company, makes a huge difference).
- Walking through the doors is not like entering any other company: people in motion and endless visual stimulus. Everything has been thought of, including checking in your luggage, complete with a ticket, and getting you a drink.
- Tours at Zappos are like a parade — tour guides carry a flag/banner, which alerts employees to greet guests. My guide, Jerry, while retired from Nordstrom (a company also founded on great shoe sales and service) had infectous energy that belies his ’silver’ exterior. The tour itself cannot adequately be described in words — the videos are a must watch.
Between the Lines: Our tour was cut short as CEO Tony Hsieh was available, so we headed straight for the ‘jungle’ (the location of his office) to catch Tony for his interview where he reminded me again of their ‘other’ brand 6PM.com.
- Not to downplay my chat with Tony (he gets so much press already), I was anxious to talk briefly with Alfred Lin (@Zappos_Alfred) because he holds both the COO and CFO roles, which I asked him about. His answers were insightful and his presence clearly belies his kid-like avatar on Twitter.
- I was a bit surprised to find out just how far they take their Core Value “Do More With Less”. Clearly operating as a 2.0 company, internally they leverage only very basic technology (email, wiki, blog, newsletter, word-of-mouth), in very simplistic ways — allowing for natural collaboration and connections of a tight culture to carry the rest.
- To dip yourself into the Zappos culture on an ongoing basis, be sure to check out employee voices via their many blogs.
- Oh, and did I mention, they sell shoes, accessories and clothing?
The last half of the Tour is shared in two parts.
- On average, 4-8 tours come through every day — more during the annual shoe conventions. While Jerry and Donavon are the primary tour guides, any employee can take the tour guide course and serve as a fill-in. This wasn’t staged — this is the ‘norm’ in their culture.
- The entire environment is a testament to their culture, of constant motion, immersion and learning. There are 4 bookcases at the entrance with multiple copies of ‘current reads’ for employees to grab and enlighten themselves — including Tribal Leadership (Zappos sponsors a downloadable audiobook version).
- Learning is for EVERYONE, on both sides of the coin — giving and receiving. Classes are ‘live’ and taught by employees. If you’re moving ‘up’ to a role, you’ll be taught by people currently ‘in’ the role. Likewise, you’ll teach those coming in behind you.
- Inspired by some of the things gleaned from Tribal Leadership, a more structured “Pipeline” path was created for classes. Training Supervisor, Loren Becker, readily shared the outline of the Pipeline program (which she merely had to print from the Zappos Wiki and had in my hands within minutes). Simplistic, there are:
- Core-Level Classes (in 6-month segments)
For the first 18 months of employment, a total of 213 required hours — the majority of which is “Customer Loyalty Training”, plus books to be read.
- Management-Level Classes
Includes 37 required hours (with department-specific specialization added in) and 6 recommended books
- Leadership-Level Classes
Includes 32 required hours (including hours to ‘teach’ classes, as noted previously).
- “Introduction to Coaching” is taught by their own full-time coach for employees, Dr. Vik — who sold his Northern California Chiropractic practice to join the team (in the Part 2 video, just before we arrive at Dr. Vik’s office, someone asks Jerry to have Dr. Vik ‘come down’ when he has a moment — there are a lot of word-of-mouth activities going on all the time). Not only did I get my own Zappos Vision planner, I also got a copy of Dr. Vik’s DVD “Taking It to the Next Level” (explained briefly here).
Special thanks to Elizabeth Gregersen who handled all of my arrangements and who was patient with my questions after the fact (here’s Liz and Jerry just having fun — its encouraged to do so). My apologies that it took so long to get this posted (it’s been a steep learning curve to edit/load the videos). If there is any information in the videos that is out of date, please let me know.
For a ‘more professional’ version, check out the ABC Nightline segment.
by Rob Paterson
January 3, 2009 at 2:48 pm · Filed under
Social Computing, Social Media, Social Networking, Social Objects, Socialprise, Web 2.0, Wikinomics
If we are to use the power of the network effect to gain more leverage – I think it will be essential to understand the underlying math. For like all things in the natural world – such as say Gravity – there is a mathematical framework that underlies their operations. When Newton could describe how Gravity worked, the modern world took off. When we can do the same for social networks, we will be on our way to solving the great dystopia of our time – that we have succumbed to a machine model.
The power of the social world is like gravity or light. It seems mysterious. It is easy to wax mystical about it. But I think that what is emerging via observation – just like all good science – is the math. What is ironic is that this math is well known and has been part of human knowledge for millenia. It just has never been applied to the social world before.
It is of course the Fibonacci sequence – the sequence that nature uses to order all relationships if they are to reach their full potential. You may know of the key number that seems to be the limit of Trust for humans of about 150 – called the Dunbar Number after Robin Dunbar.
Many in the Blogosphere have been working on this. Many have seen the sequence emerge naturally in say Guilds in Gaming. Some like Stowe and Valdis are seeing this in the power use of Twitter.
Here is a summary post I made on my own blog 2 years ago that pulled together the field of knowledge that existed then. It is my hope, I am a Historian, that people with a sharper brain than I can add much more to this in the future. I am more convinced than ever that the true potential of the power of social media to get important things done will be revealed once our understanding of how all of this works improves.
Not just marketing and media – but the ideal groupings for work, for learning for health, for credit, for families and for all of our lives. A world reset to our natural design versus a machine world.
————————————————————————————————————————————————————————-
Dave Snowden posted this recently – I could not get Cognitive Edge to accept my comment so I post them here after his post and then add some comments and list of useful links that add to the topic.
Recognise it? Well of course, it’s the best-fit reduced major axis regression equation between neocortex ratio and mean group size for the sample of 36 primate genera taken from
Dunbar’s 1992 paper which was
popularised, and not unduly trivialised by
Malcolm Gladwell into a natural limit on human group size of 150 (or 147.8 to be exact). The idea is a simple one. The human brain has co-evolved with social conditions and as a result there is a natural limit on the number of social relationships we can maintain. Dunbar linked the number to village, nomadic and military size over time. The number is exercising several people on the ever idea-stimulating value networks list serve. The argument there relates to if this is or is not a natural limit on a network or a virtual community.150 is not the only natural number. There are two others, so I could have titled this post
The rule of 5,15 & 150. All of those numbers, plus a need to think more about identity than about individuals, should influence either evolutionary or engineering approaches to community/network design.
What I plan to do is elaborate the numbers and their origins. I then want to look at the way in which the debate around Dunbar’s law is limited by atomistic ontology. This all too common assumption, found in the anglo-saxon world assumes self sufficiency and moral autonomy of the person, and sees communities as assemblies, voluntary or otherwise of individuals. Moving away from social atomism allows to take a different view on communities, their limitations and possibilities, but that will be tomorrow’s blog.
- Five is linked to the natural limits on the short term memory. This was first put forward by Miller’s 1956 paper and relates to time more than items (it is a common urban myth to see it as items). This means that it will vary a bit by language, different languages can compress more or less data into a defined time limit. If you have ever spoken through simultaneous translation then you will know that it takes 30% longer to say something in Spanish that it does in English. Given that the Welsh generally speak english 30% faster than the norm, this can present problems! Translation aside, the number is useful and it relates to common sense experience (always helpful). Think about how many directions you can remember, or how we organise telephone numbers. Another way to validate this is to think about models, or lists and see how many elements they have. More than five and you need a crib sheet. One of the reasons I restrict models in my own work to five elements is because of this. Less then five and they pass the paper napkin test which means they are sense making models as they can be drawn from memory, which means they can be used operationally without reference back to authority.
- Fifteen comes from anthropology and relates to natural levels of deep trust. I define deep trust here as the ability to tolerate a degree of betrayal. The number varies a bit based on the average size of the extended family in a society and is probably an habituated pattern of behaviour learnt during key periods of plasticity for the human brain. Now readers might be able to help be here. I got this number from two sources several years ago. The number was actually an upper limit of thirty but I reduced it to fifteen for alliterative purposes as well as accepting the realities of modern civilisation compared with the tribal systems from which the number originated. Unfortunately I have lost the reference and I am trying to re-discover it to reference in the book. All help appreciated! Again this manages a common sense test. Think about the social groups to which you belong and which pass the relaxation test. This test is a simple one, its who do you feel able to relax with, without worrying too much how your are seen. I realise that this does not always apply to families! However other than in pre or post divorce situations the ideas is that it should. The size there is definitely under fifteen, and more typically is a small number of groups of around eight or nine on average.
- One hundred and fifty is Dunbar’s law and in effect is the number if identities that you can maintain in your head with some degree of acquaints that an individual can maintain. It does not necessarily imply that you trust them, but it does mean that you can know something about them and their basic capabilities. In other words you can manage your expectations of their performance and abilities in different contexts and environments. For the moment lets consider this in terms of individuals (the switch to identity is for tomorrow’s blog). Consider your work groups and the size of your organisation. How many people do you know by name? How many people would you invite to a party? Again you can see the common sense experience coming though in the number. Now the assumption in Dunbar’s working and subsequent writing is that this level of knowledge requires physical proximity. However we now live in virtual as well as physical worlds so the nature of interactions change. The natural limit is probably in place, but its form, and the nature of its creation will have new variants for a new environment
Now these three numbers, 5, 15 & 150 have an alliterative quality which helps us remember and use them. They also have some fairly immediate and practical implications for communities and networks. That is what I want to look at in tomorrow’s blog which will come from Hong Kong. I am shortly leaving for the KMAP2006 conference at which I am keynoting for the second year, and I will also run workshop on uses of narrative in knowledge management. Hopefully I will meet up with some old friends and make some new ones, the conference has an interesting mix and looks less academic that last year when it was held in Wellington, New Zealand.
Great to find more discussion about these numbers. My bet is that by thinking only mechanistically we have “forgotten” their power and organize without any socially valid reason. This may surely be why so many organizations are so dysfunctional such as schools with say 1500 kids and no sub units. Why hospitals that merely have shifts of individuals are so unhappy. Why there is so much “stress” in most workplaces when the work itself is mundane.
The military however still keeps to these numbers. They have to – the task before them demands the full expression of what an organized group of people can do – they tend to use 8 as the base (8 men in a tent in the Roman army = a section) Sections “shrink” to 5 very quickly in action. Below 4, they are not very capable.
My bet is that 5-8 seems to work as the core unit of intimacy. Most sports teams fit this range. It enables you to pass the ball to a space knowing that the person will be there. It enables uspoken flow. It must have been the ideal hunting size.
Dave talks also about the limits to memory. You can remember a 7 number phone number but longer numbers, unless broken into sections of 3 and 4, are very hard to recall.
I recall other material suggesting that most “Tribes” in the hunter gatherer world (our cultural base) were about 35. 8 men and 8 women plus 16 youths and younger children. 35 is the platoon in the military which is the core organizing unit to get any serious work done. The Company would be about 200 as an paper ideal but would shrink in action to the 150 number which is the operational ideal.
VC friends of mine tell me that they get very concerned when they see new companies reach these staffing milestones of 8 -15 – 35 – 150. The hardest one being 15 -35 when you have to introduce some formal communication mechanisms. Complexity obviously does grow exponentially along a log scale.
Other work on gene pools suggests that 500 is the optimal number to keep enough variety. Hence tribal meetings for festivals etc that acted as genetic mixers as well.
What if these hard social numbers were brought back into formal prominence? What would happen to organizations? We see this with blogging now. My blogging social world has settled out along this gradient of 8 close intimates – about 16 close – about 35 reasonably close and a maximum world of 150. My test is my bloglines aggregator. I pay attention along the gradient.
I have also found that I can be assured that those that fit inside the 8 really do fit. I have worked with 2 of them before we ever met face to face.
So is this just an interesting topic or might it lead to an OD revolution? I add some good supporting links in the follow on:-
Chris makes the point that while guilds have these total group numbers, it is rare to have more than 40 online at any one time. More on guilds by Chris here
He goes deeper and deeper into the friction that we feel inside organizations today because we do not consider the fall out from not understanding how these numbers work. I find this diagram very helpful -
This confirm my VC friends observation that going from a group of 7-8 to 50 plus is exceptionally difficult. Moving beyond 150 is also a chasm -
I’ve already noted the next chasm when you go beyond 80 people, which I think is the point that Dunbar’s Number actually marks for a non-survival oriented group. Even at this lower point, the noise level created by required socialization becomes an issue, and filtering becomes essential. As you approach 150 this begins to be unmanageable. Once a company grows past 200 you are really starting to need middle-management, but often you can’t afford it yet. Only when you get up past that, maybe at 350-500 people, does middle-management start really working, primarily because you’ve once again segmented your original departments, possibly again reducing them to Dunbar-sized groups.
- Chris also asks in this age of social networking software “Is there an effective limit to the size of your personal network. He adds a comment by a VC friend of his -
Venture Capitalist Jeff Nolan relates similar concerns:
“It strikes me that the social networking theory holds that the more volume you have, the bigger your network will become by introducing degrees of separation roughly along the lines of Metcalfe’s Law. I disagree, human networks do not grow in value by multiplying, but rather by reduction. For me, it’s the quality of relationships that enhances my professional and personal life, not the sheer numbers.”
If you know of other good links please let me know.
by Paula Thornton
July 4, 2008 at 4:05 pm · Filed under
2.0 Design Thinking, Change, Enterprise 2.0, Social Networking, Social Work-net-ing, Socialprise
On this day of celebration of the United States revolution, I was celebrating the potential of another great revolution. Via social media and social networking, the stars and the moon aligned and the Age of Aquarius came into view.
While the theme of FASTforward ’08 was the User Revolution, the various keynote presentations actually presented compelling evidence for an even larger revolution: fundamentally redefining business models. I regularly leverage Don Tapscott’s allusion to an economic tsunami, and the corresponding revolutionary responses. But today I leveraged it in yet another critical way.
If there need be a voice to lead the charge in this revolution, the most credible voice is that of Jeffrey Hollender, President of Seventh Generation.
It occurred to me today that Jeffrey has quietly been engaged in the larger social ‘conversation’ for a long time — albeit in more traditional form of a newsletter, with a personal message from Jeffrey in each issue. But this realization only came about as a result of the serendipitous social-crossing (a random Twitter reference found) of a talk Jeffrey gave last month, at Sustainable Brands ’08.
My true enneagram one self was emotionally jumping up and down while listening to the following thoughts:
Just to give you a little context on where Seventh Generation is, after around 2000 the business was growing at about 25-30% a year. Last year the business grew 45%. This year-to-date, we’ve grown 65%.
I’m going to talk about something hard to see…something going on inside the company…the most challenging part of the equation…to build a culture…
Then he goes on to share artifacts of same.
If we come out with a marketing claim, are people in the company comfortable challenging that claim?
It also deals with things like my compensation [“Our Compensation Principles and Beliefs”]
Everybody gets a free massage every week…that’s an easy thing to do. [this is where my screaming kicked up a decibel or two] It’s easy to let dogs run around the office.
We provide 100% paid health insurance for our employees.
We ABSOLUTELY believe that employees should have an ownership stake in the company. You can’t build an equitable, responsible company if your people…don’t own part of that company.
I think that equity and justice don’t particularly exist inside most companies.
Yes, a fundamental element of Seventh Generation is social responsibility. But Jeffrey takes social responsibility to the next level, by investing in the social health and well-being of his employees. Socialprise is about fundamentally redesigning an organization around the strength of the human element. It’s about finally overthrowing over-yang’d classic business models with a healthier balance of yin. It is through the healthy balance that a company will be better prepared to survive the buffets of the economic onslaught.
Why? Because just as a tree that spreads and digs its roots deep, an enterprise is made more stable through the strength afforded it by all of its relationships. Socialprise is an enterprise that understands and capitalizes on the most important economic factor responsible for its existence: Relationship Equity.
Seventh Generation has always been fundamentally grounded in the definition of a Socialprise. They’ve not allowed newer forms of the social exchange to pass them by. Just last week, Seventh Generation started a Twitter account, to highlight key messages including posts from Jeffrey’s blog, Inspired Protagonist. I’m thrilled because I rely upon Twitter as a messaging filter more than RSS (as do others).
And now Jeffrey has joined forces with others to redefine The Future of Management, as instigated by Gary Hamel.
Mr. Hollender, count me in as a revolutionary recruit.
