Technology company Gore provides an alternative management model that dispenses with hierarchy to drive business results
It is hard to believe that a utopian management structure in which all employees are equal can exist in today’s corporate world, where hierarchy is the very backbone of how many companies are structured.
At technology company WL Gore & Associates, hierarchy and a top-down approach are replaced with a company structure that is flat, where all employees are equal and decisions are made through influencing and voting. To human resources sceptics, this may seem a recipe for disaster, but Gore’s impressive business performance and accolades attest to a management system that not only works, but is highly effective in driving results and fostering talent.
The company responsible for products such as the waterproof, breathable Gore-Tex fabric and Elixir guitar strings posts annual sales of more than US$3 billion and employs more than 10,000 staff worldwide. It is one of the few companies to appear on all of Fortune’s lists of “100 Best Companies to Work For” in the US since the rankings started in 1984. The company has also received workplace recognition in Greater China, Korea, Germany, France, Italy, Sweden and the UK.
According to Albbie Liu, Asia-Pacific HR source leader and Hong Kong country leader at Gore, the secret to the company’s success lies in its grid-like management structure, or “lattice” organisation.
“When Bill [Gore] founded Gore in 1958 with his wife, Vieve, his aim was to create an environment in which people were able to develop their potential and creativity without being hindered by hierarchical communication pyramids,” Liu explains. “Bill Gore outlined his corporate philosophy, in which there was no room for ranks and titles and no bosses in the conventional sense … the lattice structure would foster direct lines of communication to connect every associate to each other, rather than travelling through bosses.”
This distributed-leadership model is based on four fundamental beliefs that Gore put in place when he built the company and is still practiced at its global offices today: the belief in the individual; harnessing the power of small teams; fostering collaboration by sharing risks and rewards; and basing decisions on a long-term view. “We believe that if you’re passionate about your work, you’re naturally going to be highly self-motivated. Passion creates commitment, and commitment creates results,” Liu says.
As such, Gore stands out for its small, self-managed teams that form the building blocks of the organisation, an absence of formal titles, and all employees – known as “associates” – being trusted to manage their own time and commitments. There is also a focus on developing employees’ talents by matching their unique skills with their personal passions to meet a business need.
Sceptics of this model tend to challenge its leadership behaviours and struggle to understand what drives business results when people earn power by supporting others. However, Liu explains it’s not a free-for-all. In fact, she says there are strict protocols and rules of engagement before decisions or projects can be taken on board.
Staff must base all their communication and business decisions on four guiding principles articulated by Bill Gore. These are the freedom to encourage, help and allow other associates to grow in their knowledge, skill and scope of responsibility; fairness; commitment to each other and the task taken on board; and “waterline” – consulting with other associates before taking any action that could cause serious damage to the company.
“Rather than having someone tell you what to do, you get to decide what to work on and where you can make the greatest contributions as part of a team,” Liu says. “Associates can always say ‘no’ to assignments and tasks, but once you’ve made a commitment, you are expected to keep it. You’re accountable to your team.”
Liu explains that this leadership model helps the company to grow because it does not rely on a few centralised leaders to make all key decisions. “Instead, we push authority out to the relevant operating teams that are much better equipped to make the right decisions at the right moment,” she says.
Liu adds that this management model also meets the needs of the business. Because Gore’s business is so diversified, it is believed that no single leader would have the knowledge needed to lead it all. So while leaders at other companies tend to be appointed by a small group of senior-level decision makers, leadership at Gore is earned through the widespread respect of staff.
“We overcome the risk of chaos by following ‘rules of engagement’ based on our beliefs and principles. Every associate understands how critical these values are, so when leaders make decisions, people want to understand the ‘why’,” Liu says. “Leaders have the responsibility to explain the rationale behind the decision, and to put it in the context of our culture.”
In many ways, Liu explains that this system is much more efficient than traditional management structures, because by spending more time up front, staff tend to be fully bought-in and committed to achieving an outcome.
“In many organisations, leaders might make quick decisions that the rest of the organisation may not support,” Liu says. “They encounter significant roadblocks when it comes to acting on the decision. If you consider the entire process of decision-making and implementation, our approach is faster, because by the time you get to [a] decision, the whole organisation is behind it, rather than just a few leaders.”
THE VERY FABRIC OF THE COMPANY
Albbie Liu describes the benefits of Gore’s distributed leadership model.
Freedom to think “Gore’s non-hierarchical structure fosters innovation. Our associates have the freedom to develop their potential and creativity.”
Sense of ownership “We rely on a broad base of individuals and leaders who share common values and feel personal ownership for the success of the company.”
Earned leadership “A person achieves leadership by virtue of special knowledge, skills, or decision-making ability that other associates recognise and follow. Without demonstrated ‘followership’ as we call it, an associate is not a leader.”
Freedom to talk “There’s a direct line of communication at all times. Associates with suggestions may take their ideas to any associate whom they believe will help to act on the ideas.”