On February 24 of this year, in my role as a member of the Board of Directors of Haufe-umantis AG, I received an unusual message: An employee of our subsidiary from St. Gallen, Switzerland informed me about her intention to introduce far-reaching corona regulations for the location. According to this, all employees who were currently on the move in risk areas should first work mobile for two weeks after their return. Only a little later she informed me that the entire office would be closed and all employees would only work remotely.
The employee is not a manager. She took the initiative on her own – long before official corona regulations were issued in Switzerland. And she made a decision with far-reaching implications that is typically made at senior management levels.
Why was she able to implement these measures just like that within a few days? Because our colleagues introduced a strong element for employee participation in summer 2019. In a democratic election they voted for the end of the previous executive elections and instead decided on a new decision-making process: the advice process. This meant a huge turning point for us. Because since 2013, the annual executive elections have been an integral part of the corporate culture.
The so-called advice process enables employees to make decisions if their colleagues and technical experts have been asked for advice beforehand and no one has vetoed. Once the pros and cons have been highlighted, the person can then implement the process, but is also responsible for it. The advice process has established itself as a supplement to the existing management model and is part of a versatile organizational design that tries to optimally combine hierarchical and participatory leadership in order to align the company as agile as possible to the increasingly dynamic market conditions.
Farewell to the executive elections
But why did the colleagues at our Swiss subsidiary speak out against the managerial elections at all? After all, they made sure – at least in the early years – that superiors knew their team was behind them. Last but not least, they were an important part of the conviction shared throughout the group of companies to put employees at the center of our entrepreneurial actions and thinking. After all, it is they who, with their knowledge and proximity to markets and customers, are largely responsible for the company’s success.
There were good reasons for voting out of the executive elections. All those involved had noticed over the years that the desired effect of improving leadership quality was wearing off. Due to the elections, which were originally intended as a feedback instrument, the team and manager were no longer in regular and close communication with one another. Rather, employees postponed critical feedback in particular to election day. At the same time, executives feared being punished for making unpopular decisions. With the increasing growth of the company, it has also become more and more difficult to define who is allowed to participate in the election, how it can run efficiently and how one can ensure an open and in-depth exchange about the expectations of leadership in terms of time and space. These reasons led us to set up a working group whose task it was to reform management elections – or to develop an alternative.
Why the advice process?
The working group came to the conclusion relatively quickly that revising the management elections would not bring us any closer to the actual goal: the employees were originally supposed to be able to participate more actively and actively participate in initiatives at any time.
Inspired by a conversation with Frédéric Laloux, the author of “Reinventing Organizations”, the idea of implementing the advice process finally came up. With this element, we were able to use the expertise of all employees for quick and efficient decision-making, without having to forego classic management structures entirely. The employees consequently voted against the continuation of the democratic elections and for the advice process.
What does the introduction of the advice process mean for a company?
In the 15 months since the introduction of the advice process, the understanding of leadership and the leadership culture has changed fundamentally: employees can temporarily take over leadership on certain topics and then withdraw again. Thus, leadership in certain application areas is distributed to different heads depending on the situation and decisions are made where the greatest competence lies. This takes courage – from everyone involved: Employees need courage to expose themselves, to contribute ideas and knowledge and to take responsibility for their decisions. Managers need courage to hand over responsibility, to share the consequences of decisions and to trust in the strength, competence and willingness of their own employees to take responsibility.
The advice process in practice
Today we have already made a number of decisions with the help of the advice process. For example, an interdisciplinary team has made sure that our product “My Onboarding” “moves” to another business area. The team members noticed that there were strategic conflicts of interest due to the structure – a fact that management was not aware of.
This experience has shown us once again that challenges are often first perceived at the grassroots level. If the employees have the authority to solve them there, a problem can be nipped in the bud before it becomes a wildfire. The process also helps us to seize opportunities before the right time is missed on the arduous path through the instances.
Overall, the experience at Haufe-umantis shows: The advice process ensures better empowerment and participation of employees without giving up the formal management structure that has proven itself in many respects. It manages better than the election process to encourage employees to be proactive, to give them responsibility and let them shape it. At the same time, it increases the quality of the decisions.
Joachim Rotzinger has been a member of the Haufe Group management since 2010. He is the managing director of Haufe-Lexware GmbH & Co. KG and a member of the board of directors of Haufe-umantis AG. He is responsible for business with corporate customers. He has been with the Haufe Group since 2001 and has played a key role in various positions in developing the once traditional publisher into a provider of digital workplace solutions.