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Sparking innovation from the bottom up

2013-11-26 09:30:52

Ronald Alsop

Roberto Henriquez had an intriguing idea. The 30-year-old information

technology project manager thought he and his IBM colleagues could work more

efficiently if they had an app enabling them.

Normally, he would need approval from a senior-level review board for such an

idea.

But not this time.

Instead, he quickly received the blessing and financial backing of his

peers through a new corporate crowdfunding system in IBM s internal IT

organisation.

Henriquez s idea was pitted against other proposed projects seeking funding

from employees in the IT group. Each of the more than 300 participants from

entry-level workers to vice presidents received $2,000 to invest over an

eight-week period. Then, through the crowdfunding system, Henriquez managed to

raise a total of $20,000, and after a few months of development and testing,

project managers started using his app.

The experience was empowering for Henriquez, who is based in Bratislava,

Slovakia. I don t feel like I work for IBM; I feel like this is my company,

he said.

That s music to the ears of IBM executives who hope the iFundIT project will

engage employees and spark more innovation from the bottom up.

Getting employees engaged

Employee engagement is a pressing issue for most companies these days. In a

study of 142 countries, Gallup found that only 13% of employees worldwide are

engaged in their work. The percentages vary widely by nation, with 30% of

workers in America saying they are engaged; 24% in Australia; 17% in the UK;

15% in Germany; 9% in India; and just 6% in China.

One possible solution to this problem: more egalitarian workplaces where

employees feel they have more control over decisions, such as IBM s iFundIT

program.

Companies need to be more compatible with this democratic age of the Internet

and social media that we live in now, said Traci Fenton, chief executive

officer of St. Louis and London-based WorldBlu, which provides consulting

services for creating freedom-centred workplaces. Organisational democracy

means decentralizing power and recognising that good ideas are everywhere in

the workplace.

Seeking employee input may slow some types of decision-making, but Fenton

believes it could speed up the execution process because workers would feel

more invested after having their say. Of course, companies only want to do

this if they re sure they re going to act on a group decision, she said. If

they don t follow through, they ve done more harm than good.

WorldBlu compiles an annual list of the world s most democratic workplaces

based on such factors as being transparent and accountable, sharing power, and

giving employees meaningful choices. The biggest obstacles to workplace

democracy are executive ego and ignorance, Fenton said.

Some people simply don t want to give up control; others fear what they don t

understand, she said.

A democratic workplace has cross-generational appeal, although IBM believes its

crowdfunding project will especially resonate with millennials, who are used to

airing their views in blogs and social media and believe they deserve to be

heard at work, too. Millennials is a term used to describe the generation of

people born between about 1980 and 2000.

Small workforce, big voice

Some companies with a small workforce are going even further and giving

employees a voice in some very major decisions. When DreamHost s founders

decided in 2011 to recruit the first CEO for the Los Angeles-based Web hosting

firm, they let employees vote on the finalists. More recently, its 165 workers

voted on the company s health benefits plan.

We feel that by letting our employees make the decision after they know how

much different benefit packages will cost, we re empowering them and

encouraging them to stay with the company, said Ed Wesley, director of

organisational development and learning. It takes guts to be democratic and

give employees more control, but the payoff is happiness and engagement.

Companies like DreamHost and Menlo Innovations, a software company in Ann

Arbor, Michigan, also are opening the financial books to their employees to

guide their decision-making. Our goal is for the staff to make decisions about

where we spend money, but they need to understand the big financial picture of

the company first, said Rich Sheridan, the CEO at Menlo, which has about 50

full-time and temporary workers.

Already, Menlo gets 15 to 25 workers involved in assessing a job candidate as

he or she goes through interviews and tryouts. We work in pairs so we want to

see evidence of kindergarten skills, whether they can play well with our

employees, Sheridan said.

Of course, it s easier to democratise small businesses than multinationals with

thousands of workers scattered around the globe. But IBM shows that even a

company with more than 430,000 employees in 170 countries can give at least

some of them more decision-making authority.

We need to flatten the organisation; not every investment decision has to be

made by a director or vice president, said Francoise LeGoues, the head of IBM

s CIOLab and creator of iFundIT. We want collaborative innovation. How do we

ensure that young people s ideas get attention and that someone in Bangalore

connects with someone in New York?

Eligible projects must be related to internal information technology, although

they could also be applied to products, such as IBM s social software platform

for businesses. It has to be a small project, LeGoues said. These won t be

large, multi-year projects like a redesign of the entire HR system, for

example.

About 160 projects were submitted during the first two crowdfunding rounds this

year, with 20 reaching their funding target of between $10,000 and $30,000.

Funded projects included Influence of Communities from China (search results

based on influence, not popularity) and reMap from the UK (a collaborative

outlining tool to organise and share information across teams of all sizes).

The level of excitement and participation has surprised me, LeGoues said.

People have even begun running internal campaigns to try to get others to spend

money on their projects. This is really a game changer in the way people think

about what it means to be an IBMer.