Two unorthodox business approaches that work

[Ilya Shambat]

Having worked in a number of professional settings, I have seen two
non-orthodox approaches do good things for the companies that practice
them. One is cultivating loyalty to the company through direct
personal engagement between the boss and the workers. The other is
involving people at all levels in the decision-making process.

The first works especially well for smaller companies. I have worked
for two companies that were managed by people from Lebanon. The
companies were very different from one another, one being a computer
company and the other being a restaurant; and the CEO's of these
companies had very different personalities. But they both went out of
their way to engage with employees and build personal relationships
with them.

There are a number of ways in which this can be a benefit. One is that
one makes and keeps friends - which, besides being a good thing in
itself, can also be good for business, as the friends that one makes
can come in handy. Another is that trust is built between the company
and the employees, and one has less to fear of the workers doing their
job badly or hurting the company. Finally, an employee who feels
personal loyalty to his employer is going to be motivated to go beyond
the call of duty and do as much as he can to benefit the company
instead of only doing as much as is required for him to keep his job.

The Lebanese have done well commercially all around the world; and
their warm and personal management style has much to do with this
commercial success.

For larger companies, where the CEO can't be friends with everyone,
loyalty is best built through close worker-manager interactions.
Oracle, which has 100,000 employees, cannot have everyone be friends
with Larry Ellison; but it can maintain, and does maintain, a much
more democratic management style than many other large companies. And
having worked for Oracle I can say that their management style works
wonders, and for this reason:

They involve people at all levels in the decision-making process.

Now someone may say, Well how can someone with just a few years of
experience have useful ideas to offer the company? You'd be surprised.
People come in with all sorts of knowledge and life experience, and
you never know who will have something useful to say. Involving people
at all levels in decision-making process carries a wide array of
benefits. It prevents groupthink; it brings in all sorts of useful
perspectives that top management themselves may not think of; and it
enlarges the pool of ideas from which to choose. Oracle understands
this, which is why it has grown from 30,000 employees to 100,000
employees in a decade in which many other computer companies folded.
The Israeli army understood this before did Oracle, which is why it
has a reputation as the most effective fighting force in the world.

Both of these tactics are not orthodox business; but they have been
highly effective for businesses that have chosen to practice them. And
the rest of the business world has much to learn from companies that
practice these approaches.

[Moderator's note: Originally submitted January 21, 2012]

[Mark T. B. Carroll]

Ilya Shambat <ibsh...@gmail.com> writes:

> Having worked in a number of professional settings, I have seen two
> non-orthodox approaches do good things for the companies that practice
> them. One is cultivating loyalty to the company through direct
> personal engagement between the boss and the workers. The other is
> involving people at all levels in the decision-making process.

To some extent, I think both are necessary anyway. It is important for
senior management to know what actually goes on in the company, and it
is important for those who will have to make good on promises to
customers to be involved in the promise-making. On the other side, I
have seen companies where middle-management like things as they are and
want to pretend that things are good, meaning that they prevent senior
management knowing how bad they are and from hearing the ideas from the
trenches about how things could be much better. Also, I have seen the
sales/contracting side make promises to customers that those who
actually work on the products know are very unrealistic and, sure
enough, panic and disappointment follow. Neither of these have much to
do with loyalty, except of course that dysfunction and fiascos are bad
for retention.

Mark