A UCLA MBA student has gone rogue! He has turned his back on all the management theories he learnt at this prestigious institution and if he were in my vicinity right now- I would high five him, possibly twice. Like a refreshing glass of chilled tomato juice on a hot summer evening, it is great to see flexibility and openness to doing things differently especially when is comes from the top.
At Morning Star, the worlds largest tomato processor there are no managers, no directives from above, no promotions, no titles. Here’s how it all began; Founder Chris Rufer (he gets grumpy with the term CEO), started a trucking company to get the tomatoes to canneries more than 40 years ago. Rufer knew that managing the truck drivers would be virtually impossible “How do you manage truck drivers, anyway?” Rufer muses. “Put a supervisor in every truck? So he did the unthinkable, he entrusted them to get the job done without his constant interference. This practice worked in the trucking company and now it works for what can swell to 2,400+ employees in season. As Ben Cohen so eloquently puts it: “It’s a beautiful way of structuring a workplace. Management is not nearly as necessary as it thinks it is.”
Morning Star practices self-management and mutual-management. You know what you need from me to do your best possible work, and I know what I need from you to do mine. Commitments are embedded in peer-to-peer contracts known as colleague letters of understanding, or CLOUs. The keystone of each CLOU is a “personal commercial mission,” crafted by each employee to describe her contribution to Morning Star’s success. The terms and conditions of how people will work together are determined by the people who will be working together. Power to the people – another high five to Rufer.
Brian Hagle who has been with Morning star for 22 years feels that it’s almost like every one of us is manager or CEO, We set our goals high, and they’re our goals, so when we meet them, there’s a real feeling of achievement.
I read this next paragraph just to be sure I had read it right: Autonomy extends beyond deliverables. Need equipment to do your job? Buy it. See a process that would benefit from different skills? Hire someone. Colleagues consult one another and then simply act. An empowered and motivated workforce – Rufer we’re on high five number 4.
Heres the clincher, Employee-elected compensation committees set pay levels after measuring colleagues’ performance against their CLOUs and other metrics. Morning Star can pay 15 percent more in salaries and 35 percent more in benefits than the industry average because it’s not paying managers and productivity is so high.
Rufer for president, or whatever his untitled version would be. Seriously.
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