473

conclusion
#workout
conclusion

management30.com
Management 3.0 Workout © 2014 Jurgen Appelo

© 2012 Jurgen Appelo

474

I have collected ideas from

many sources and offered
them as concrete practices.
But copying games and
exercises is not enough
I feel very strongly to change organizations.
that change is good You must adapt practices
because it stirs up to your needs, and keep
the system. in mind the principles of
engaging people, improving
Ann Richards,
American politician the system, and delighting
(1933–2006)
all clients.

We’ve reached the end of the book, and this makes me feel both happy
and sad. I feel happy because you wouldn’t believe the amount of work
it takes to produce a book like this. It’s not just the effort of jamming
a hundred thousand words into a text editor. The main challenge is
putting them in a sensible order! And then there’s the research (fun!),
the illustrations (I make them all myself), the formatting (delegated
with pleasure), the marketing (never delegate this!), and the reviewing,
rereading, rewriting, restyling, redrawing, redacting, referring, recy-
cling, and (thank heavens!) also some reclining and rejoicing. And the
emails. My God, the emails! I could bury a pair of horses, with carriage,
under the amount of emails I get each day. But, to be honest, it’s the
emails that keep me going. The encouragement from readers always
makes me happy. However, reaching the end of a big project delights
me even more! As I wrote long ago on my blog, I can only enjoy my
work when I know it will come to an end. [Appelo, “Where’s the End?”]
The work of managing can be
done by just about anyone if
they have the right informa-
tion, incentives, tools, and
accountabilities.
Hamel, What Matters Now loc:4123
475
The end of this book also makes me feel sad because there’s still
conclusion
so much I want to discuss with you! We didn’t cover collaborative
hiring, A3 problem solving, the happiness index, impediment doors,
competence grids, and many other topics. I haven’t told you that
story of the boss who woke up in a meeting room with a binder full
#workout
of performance appraisals wedged in his trousers. It would take an
additional book of similar size just to cover the things I had to leave
out of this one! Well, who knows? Maybe I’ll write it some other day.
In any case, what I hope I have achieved with the chapters I did
write is that you believe, as I do, that everyone is responsible for
management. You shouldn’t wait for full-time managers to innovate
the way you organize your work. Good management practices are
about engaging the workers, improving the system, and delighting
the stakeholders. Anyone can do that.
© 2009 Anssi Koskinen, Creative Commons 2.0
http://www.flickr.com/photos/ansik/3218139011
 The Idea Farmer
476

Almost everything in this book emerged because I read a lot of

books, blogs, websites, and magazines. (And I travel a lot.) I read
because I love collecting other people’s good ideas. As I often say,
“steal and tweak” is the best recipe for innovation. Everything I say
is stolen and tweaked, even the concept of “steal and tweak” itself.

If you aim to reach as high as possible,

don’t limit yourself to the giants.
Find the small ones who are standing on Stories of success and failure consistently exaggerate the
their shoulders! impact of leadership style and management practices on

firm outcomes, and thus their message is rarely useful.

In my search for good ideas, you may have noticed that I don’t limit
myself to reading the timeless classics of famous gurus. I also refer Kahneman, Thinking Fast and Slow loc:3473
to many lesser-known books and articles that only a few people have
read. The thinking behind this approach is that if you aim to reach I’m an idea farmer. I grow new ideas from old ones. When the new
as high as possible, don’t limit yourself to the giants. Find the small ideas are fully grown, I sell them. Or when they’re still young and
ones who are standing on their shoulders! small, I often just give them away for free because that helps them
to become better and more experienced.
I nurture all the big and small ideas that I find. I water them with my
attention, and I feed them with my thoughts. After a bit of time and You’ve almost finished reading a book full of ideas about concrete
energy, the ideas often start sprouting offspring. I allow them to management practices that people can implement next Monday
mix and mingle with each other; I let them connect, compete, coop- morning—not only managers, but everyone who is concerned about
erate, and copulate in the weirdest ways. Sometimes they make me the management of an organization. Management is too important
blush. But the offspring are worth the trouble. I care for these new to leave to the managers! However, just copying ideas and practices
ideas and I try to make them healthy and strong. from other sources is not enough to change an organization.
 477

Never forget that better principles,

conclusion
not better practices,
are what organizations really need.

#workout
Never forget that better principles, not better practices, are what
organizations really need. It is far too easy for organizations to let
newly adopted good practices evolve into bad principles! [High-
smith, “Agile Bureaucracy”] Most workers, however, don’t know how
to pursue abstract principles without concrete practices. Creative
networkers usually appreciate actionable advice. People tell me that
they want to experiment with Delegation Boards, Moving Motiva-
tors, Salary Formulas, Merit Money, and much more. With this book,
I have tried to give you exactly that—much more. But the workout
practices are just the start. Your goal should not be to merely imple-
ment the practices I gave you because this is unlikely to change any
outcomes. Your goal is to teach the organization the new principles.

The world is too complex to give you merely a list of

practices to follow. What managers in the 21st centu-

ry need most is insight so that they can develop their

own prescriptions for their own particular needs.

Mintzberg, Managers, Not MBAs pag:252

© 2012 Jurgen Appelo

 But… We’re Different!
478

Almost every time I’m in another country (did I tell you I travel a
lot?) people ask me, “Is management different elsewhere?”

“Are better management practices more difficult in China?”

“Are problems in Eastern Europe different from those in the West?”

“Is it easier to be agile in Scandinavia than in the United States?” bank, a beer manufac-
turer, or, God help
“How does business culture in Holland compare with The us, a government
Netherlands?” institute in our
own country! I’ve
My answer is always, “Yes, things are a bit different”. But, this differ- noticed, again
ence is a lot less than people seem to expect. No matter where I go, and again, that
people have the same problems with management and leadership; cultural differences be-
they notice the same challenges with self-organizing teams; and tween geographical areas
they report the same findings about business transformation and pale in comparison to the
organizational culture. Certainly, some (generalized) cultural differ- cultural differences between
ences between countries are real. The Germans are straightforward industries, between job types,
and the French are sensitive. The British are polite and the Dutch and between companies.
are blunt. But you’d be an idiot—remember, I’m Dutch—to see this
as an obstacle. Don’t get me wrong. I don’t mean that we
can safely ignore regional cultures. I just mean that, when people
Business culture trumps geographical culture—always. In my expe- are always focusing on the differences between countries, they tend
rience as a manager, I noticed that the differences between develop- to overlook the much richer diversity in their own backyard. They
ers in The Netherlands and developers in Ukraine were insignificant also overlook the many ways in which different workplaces around
when compared to the differences between developers in The Neth- the world are actually quite similar. Perhaps we should stop focus-
erlands and account managers in The Netherlands. Likewise, the ing on how people in other countries are different. We can solve
cultural differences between our two offices in The Netherlands and more problems when we realize how much we are actually the
Ukraine were nothing when compared to the differences between same, and how much we can learn from what others are doing on the
our web development company and… oh, let’s say an investment other side of the world.

But… It Doesn’t Work!
Be aware that “learning what others are doing” is not the same as
“doing exactly what others are doing”. What if a cook uses a recipe
she found on the Internet, decides to follow it to the letter, and finds
out that the apple pie she baked is not what she expected? Can she
say that the recipe “failed”? What if she says, “Apple pies don’t work
around here. We tried. Nobody liked them.” Would that make sense?
You may remember the story of my horse ride in the Andean moun-
tains of Chile, which I shared with you in the chapter on Delegation
Boards. The ride started with a four-hour trip. It had been raining
all day, and everything was wet, and I had scraped my leg against
a rock, and we were tired and cold and grumpy, and my horse was
trying to bite the other horses, and basically, everyone in the group
was feeling miserable, horses included. That is, until we arrived at
our destination, a cabin deep in the forest. The place was lovely,
warm, and cozy. And Jane, the American tourist who had arrived a
day earlier, had baked an apple pie for everyone. It was deeeeeeli-
cioussss. Jane felt a bit unsure because she had to adapt her recipe
due to not having some of her favorite ingredients, having a strange
kind of apple to work with, and having to use a simple wood oven
that didn’t have CoolTouch, FanGrill, or PyroTech features. But she
had adapted remarkably well. Her apple pie was the best thing that
could have happened to us after four hours of Andean suffering.
479
conclusion
Great workplaces become great due to their
#workout
own unique approach. Assuming that there is
“one best way” can slip you into an external
locus of control pretty quickly.
Robin and Burchell, No Excuses loc:702
A recipe is just a sequence of suggestions, nothing more. A cook
cannot say, “The recipe doesn’t work”, because the recipe doesn’t do
anything. The one who does all the work is the cook. If she doesn’t
get what she hoped for, my guess is that she’s just inexperienced
in the current environment and needs some time to learn how to
adapt the recipe. Maybe she didn’t compensate for the bigger-than-
average eggs that she used, or the hotter-than-intended oven, or the
different brand of flour, or the bland taste of the cheap spices she
purchased in the convenience store, or the various culinary prefer-
ences of her guests. “The recipe doesn’t work” is shorthand for “I
haven’t yet worked out how to adapt the instructions to local circum-
stances and make a version of the recipe that works.”
It’s the same for any other useful practice, whether it’s a recipe for
cooking, a management practice, or a workout exercise. Of course,
things often don’t work exactly as prescribed somewhere else in the
world. You have to make an effort to make things work. Be like Jane,
work with what you have, and learn to be great. Apply the practices
in your own unique way.
 Value Networks
480

You may have noticed that many practices

described in this book refer to clients and
stakeholders, not customers. That’s because
I believe an organization is a network of
clients and stakeholders who collaborate to
produce value for everyone involved. Share-
holders supply capital and advice because
they hope to get a return on their invest-
ment at some time in the future. Employees
supply labor and brains so that they get a
salary and a fulfilling job in return. Suppli-
ers bring in goods and services in exchange
for a proper fee. Customers bring in cash so founders, banks, guilds, unions, competitors, customers. The proponents of this princi-
that they get the goods or services they find and more) are trying to generate value for ple often reason as follows: If you optimize
valuable. And the local community should themselves from their collaboration with the delivery of value to your customers,
supply the business with a healthy, stable others. The business is not a value stream; it then you must take good care of your em-
environment and moderate taxes, so that the is a value network. ployees as well. And when employees and
region benefits from employment and eco- customers are both happy, the happiness of
nomic growth. There might be some found- Nowadays we are increasingly faced with shareholders, suppliers, and everyone else
ers among the stakeholders as well, possibly books and articles on the topic of customer will follow automatically and, magically, all
hoping for fame and fortune. value. They usually tell us that the primary will be well. Hurray!
goal of a business is to deliver value to its
Some writers and consultants portray busi-
nesses as factories around a “value stream”,
but I find this problematic. There is no The aim proposed here for any organization is for everybody to gain
“stream of value” flowing through a business
in one direction. The metaphor is mislead- – stockholders, employees, suppliers, customers, community, the en-
ing. A business is a network of stakeholders
all creating value with and for each other. vironment – over the long term.
All parties involved (shareholders, em-
ployees, customers, suppliers, communities, Deming, The New Economics pag:51

Unfortunately, the customer-value principle is almost as misguided
as its predecessor, the shareholder-value principle. Instead of optimi-
zation in favor of the shareholder, it preaches optimization favoring
the customer. This is equally bad because many customers don’t care
if products are made by seven-year old children in sweatshops. Many
customers don’t care that toxic waste is dumped in Africa. Many cus-
tomers don’t care when suppliers are squeezed to near bankruptcy.
Many customers don’t care when shareholders are left empty-hand-
ed. And when you replace “don’t care” with “don’t know”, you im-
mediately see the strong incentive for managers to keep the harsh
truths of business away from their customers for as long as possible.
Plenty of consumers actually value the comfort of ignorance over the
burden of knowledge. Not knowing what is going on elsewhere is
less strenuous for a person’s conscience and for her wallet.
Not knowing what is going on elsewhere
is less strenuous for a person’s
conscience and for her wallet.
An exclusive focus on customer value (or the value of any other single
client or stakeholder for that matter) is a clear case of sub-optimiza-
tion. When I talk about this, people often give me one of two replies:
Yes, but a focus on customer value requires respecting people!
This is the same longstanding argument of the shareholder-value
movement which, apparently, didn’t work out too well. It is clearly
possible to optimize for shareholder value (in the short term) and
to ignore the other stakeholders. Ultimately, I believe this strategy
always fails in the long term because it is unsustainable. I don’t
believe for one moment that this strategy is going to work for busi-
nesses that focus purely on customer value. Customers might be
delighted for a while, but other stakeholders will suffer and pull out.
481
conclusion
A corporation that fails to see itself as an instru-
ment of [all] its stakeholders will not survive.
#workout
Ackoff, Re-Creating the Corporation pag:289
Yes, but stakeholders can organize themselves and keep pressure
on management!
This is like saying it’s OK to ignore or even abuse other stakeholders
until they make the effort to organize and become powerful enough
to convince managers that it’s not OK to ignore or abuse them. It’s
OK to sub-optimize until someone convinces managers not to sub-
optimize. It’s OK to be unethical until someone convinces manag-
ers not to be unethical. Does that sound like a good strategy? Why
improve the whole system later if you can do that now?
I believe the whole system is a social network of people generating
value for each other. A business is a value network. It is sustainable
only when all clients and stakeholders are treated well. This requires
compromises. By all means, draw a value stream map to optimize
value delivery for your customers. But you might have to do the same
for shareholders (are they getting a return on their investment?), and
for employees (are their jobs bringing them money and fulfillment?),
and for suppliers (are they getting what they need?), and for local
communities (are they happy with your business being there?) Cus-
tomer value is a great idea if, and only if, it is properly balanced with
shareholder value, employee value, supplier value, community value,
and many more. Your business generates value in all directions.
Of course, managing multiple stakeholders is hard! It is difficult to
satisfy everyone’s needs. I never promised anyone management is
easy. Sorry! Sadly, because it’s difficult, naïve people tend to pick one
client as the primary stakeholder, and treat all others as secondary.
482

In a complex adaptive system, no observer has a view on

the whole. Ideas and movements such as Shared Value

[Porter and Kramer, “Creating Shared Value”], Deliv-

How to optimize ering Happiness [Hsieh, Delivering Happiness], and

the whole Conscious Capitalism [Mackey and Sisodia, Conscious

Capitalism] all attempt to reconcile multiple views of

Again and again I have come across suggestions to “op- businesses, not only the customer’s perspective. We can-

timize the whole value stream”. The assumption is that not “optimize the whole” by focusing on one perspective.

the customer’s view on a business is one that covers the The best we can do is to sub-optimize everywhere, and

whole system, and therefore a relentless focus on cus- compete, collaborate, and re-optimize in an ecosystem

tomer value delivery will “optimize the whole”. full of value dependencies. All the parts try to optimize

for themselves, and thanks to many interdependencies,

It is as deceptively simple as it is false. the whole system tends to evolve to an optimum.

© 2010 Jakob Montrasio, Creative Commons 2.0

http://www.flickr.com/photos/yakobusan/6759445957

Blaming the System
Remember that I told you in the Introduction that most questions
I receive from people around the world are about changing other
people’s behaviors. Now that we know we should manage the sys-
tem, and not the people, we run the risk that dissatisfied workers will
move from blaming other people to blaming the system. I’ve noticed
this tendency among coaches, consultants, and systems thinkers.
“It’s not the people who perform badly; it’s the system that doesn’t
enable people to perform.”
“It’s not the employees’ decisions that are wrong; it’s the system’s
rules and procedures we should get rid of.”
“It’s not the individuals who screw up; it’s the organization that
drives everyone to failure.”
Oh, really?
Who created that bad “system”, I wonder? Did some alien life form
impose it on everyone, or are the workers themselves responsible for
it? What are those rules and procedures, actually? Do they exist to
program and steer human beings as if they were computers, or are
creative networkers smart enough to think for themselves? What is
the “organization”, really? Can we point to it, somewhere? Or can we
only point to people?
483
conclusion
Seriously, I don’t see the difference between blaming the system and
#workout
blaming other people. It seems to me it’s all the same, as long as
workers are not blaming themselves!
How convenient.
One of my best friends has hated her job for years, and, knowing the
organization, I’m sure many of her 4,000 colleagues feel the same.
But even after years of not liking her job, she still hasn’t moved to an-
other employer, and she has not introduced any of the practices de-
scribed in this book. She’s a bit like Melly Shum, who has hated her
job for 25 years. Does it help either of them to switch from blaming
their colleagues to blaming the system? I’d say, “Blame yourself!”
The “system” is 4,000 colleagues, made up of people just like my
friend, who make each other’s lives miserable every day. The “rules
and procedures” are people’s own behaviors that they inflict upon
each other. And their “bad culture” only exists because 4,000 people
have collectively decided not to take responsibility for management.
If you want a bad system to go away, you should stop helping ab-
stract things such as systems, rules, and procedures to be turned
into a horrible reality. Only people have that power. Stop blaming
the system. Blame yourself.
 Management Habits
484

This book is full of suggestions for better management, and I’m sure
it’s just the tip of the iceberg. Many other people have great ideas
for concrete practices that can help you to engage people, improve
work, and delight clients. In fact, there is no shortage of ideas. There
is a shortage of commitment to making them happen.
There is no shortage of ideas.
There is a shortage of commitment
Now it’s up to you!
It’s your turn to make things happen by implementing practices
and experiencing principles. With some workout exercises, this may
involve convincing a manager to make time, space, or money avail-
able for your experiments. Convincing managers of the benefits of
new ideas is best done by delivering on commitment in order to
create trust, always trying to solve your manager’s problem first, and
experimenting with new ideas in safe-to-fail environments. [Berkun,
“How to Convince Your Boss to Try New Things”]

to making them happen.
The world is too complex to merely give you a list of practices to
follow. This is why I started this book describing the principles of
Management 3.0. Just giving people a few principles, however, is
not enough to improve behaviors. Most people may understand
principles intellectually by hearing about them, but they only truly
grasp their significance by experiencing them. It’s the experience
that follows from adopting good practices.
With other workout exercises, you don’t need anyone’s cooperation
and you can just start right away. Usually, the main challenge here is
to keep exercising regularly. The benefits of new practices may take
a while to reveal themselves. Your efforts should focus on finding
the right triggers that make it easy to initiate good behaviors, and
finding short feedback loops that reward you and enable you to turn
the practices into habits. [Duhigg, The Power of Habit]
For all workout exercises, I can say they have already proved their
benefits for other businesses, but you must try them for yourself and
make them your own.

Trying to copy or reproduce another company’s tools, techniques, or principles does little to change an or-

ganization’s culture, its way of doing things. For example, how do you get people to actually live principles?

On the other hand, focusing on developing daily behavior patterns is a leverage point because, as the field

of psychology shows us, with practice, behavior patterns are changeable, learnable, and reproducible.

Rother, Toyota Kata loc:171

 485

conclusion
#workout
A project wizard
“If I have to say one thing about your work, it is complexity I know that what I need to do is to locally construct just

theory and systems thinking that I have been able to use enough boundaries and feedback mechanisms to get going

the most. Knowing that it is all about how the entire system and improve from there. My managers are impressed and

acts on individuals, and how individuals act on the entire I enjoy my work. An identity as “The Project Wizard” has

system, has made me more confident and systematic as a stayed with me, inspired by your project credits workout. I

project manager and as a change manager. also started a project management network at my consul-

tancy firm inspired by your business guild workout.”

Johan Dahlbäck, Sweden

© 2011 Ibrahim Iujaz, Creative Commons 2.0

http://www.flickr.com/photos/notsogoodphotography/6608891363
 I Love Management
486

I remember well that I hated management many years ago. I hated

checking whether people had done what I told them to do. I hated
doing performance appraisals. I hated negotiating individual sala-
ries and bonuses. I hated aligning teams with top management’s
business-strategy-of-the-week. And I hated wearing a suit and tie
while all the nice people were wearing jeans and sweaters.

It took me a while to understand why, but now I know.

It was bad management I hated. Now it’s

easy to
It’s different now. These days I love giving direction to the Manage- understand
MANAGEMENT 3.0
ment 3.0 licensing program. change and innovation practices I love discovering the why.
intrinsic motivation of people, inspiring them with storytelling, and
discussing constraints with self-organizing teams and facilitators. I I love good management,
love leading workshops and measuring my progress when writing and it seems I’m one of the few
or speaking. I love being one of the founders of both the Agile Lean people in the world who actu-
Europe network and the Stoos movement, and I love developing and ally loves his job. Yes, I was an
nurturing our Happy Melly business. Oh, and I love wearing jeans unhappy Melly in the past, like many
and sweaters. others. But now I’m a happy Melly!

MANAGEMENT 3.0
change and innovation practices
 Life is too short 487

conclusion
to spend in jobs we don’t love

#workout
“I was in the middle of designing a complex 360-degree with your job, you have three options: ignore it, quit your

evaluation system when I heard about Management 3.0 job, or try to change the organization.” It was like hitting a

for the first time. One of my friends told me about a course switch and turning on the light! I did my best to convince

in Turkey and I decided to take this opportunity. After the my boss and the board about the problems people had with

course, I returned to work with several ideas, including the their management style. I was sure that something would

Merit Money practice. It was a much simpler method than change: either management would improve or I would leave.

the system I originally had in mind. We started it with twen-

ty people in three teams. Nobody argued about its fairness. And indeed, things changed! I left the company along with

It was entertaining; it caused many fun discussions among several people from our teams. We created our own work-

teams; and it gave me a simple metric that was not based on place, in the way we wanted, and without burning somebody

my own subjective opinion. else’s money. ;-) Now we are not employees but initiators.

We realized that life is too short to spend our lives in a work-

There was also a little book in my bag called How to Change place we don't love.”

the World that I had received at the course in Turkey. The

book started with a simple argument: “If you are not happy Alix Moghadam, Iran
488 When I started writing this final chapter of my book, I received the
following message from a reader:

I find your work not just interesting, but also im-

portant, helping people and organizations to cope

with the challenges at work every day. I also find

that it is very important in efforts to innovate the

way we are organizing work today.

Lazar Todorov, a kind reader from Germany

I often maintain a healthy skeptical attitude toward any claims and

praise in the emails that I receive, but for messages like these, I
gladly make an exception. ;-)

Hopefully, I have given you enough inspiration to introduce bet-

ter management, perhaps even with fewer managers. With this
book, you now have serious games to help improve organizational
culture, simple practices that increase employee engagement, cre-
ative stories that inspire teamwork and collaboration, new ways
to achieve team accountability and responsibility, concrete steps
toward more creativity and innovation, easy workout exercises
to make the business more agile, and modern tools that enable
people to enjoy a happy Monday.

Now you can change your organization’s culture, step-by-step,

by engaging your people, improving your work, and delighting
your clients.

Have fun!

© 2012 Jurgen Appelo

 489

References

conclusion
•• Ackoff, Russell L. Re-Creating the Corporation: A Design of Organizations for the 21st Century. New York: Oxford University Press, 1999. Print.
•• Appelo, Jurgen. “Where’s the End?” <http://bit.ly/1fGScHv> NOOP.NL, 13 December 2012. Web.
•• Berkun, Scott. “How to Convince Your Boss to Try New Things” <http://bit.ly/1gMMc1I> Scott Berkun, 26 March 2014. Web.

#workout
•• Deming, W. Edwards. The New Economics: For Industry, Government, Education. Cambridge: MIT Press, 2000. Print.
•• Duhigg, Charles. The Power of Habit: Why We Do What We Do in Life and Business. New York: Random House, 2012. Print.
•• Hamel, Gary. What Matters Now: How to Win in a World of Relentless Change, Ferocious Competition, and Unstoppable Innovation. San Francisco: Jossey-Bass, 2012. Print.
•• Highsmith, Jim. “Agile Bureaucracy: When Practices Become Principles” <http://bit.ly/1njD8bV> Jim Highsmith, 10 July 2012. Web.
•• Hsieh, Tony. Delivering Happiness: A Path to Profits, Passion, and Purpose. New York: Business Plus, 2010. Print.
•• Kahneman, Daniel. Thinking, Fast and Slow. New York: Farrar, Straus and Giroux, 2011. Print.
•• Mackey, John and Rajendra Sisodia. Conscious Capitalism: Liberating the Heroic Spirit of Business. Boston: Harvard Business Review Press, 2013. Print.
•• Mintzberg, Henry. Managers, Not MBAs: A Hard Look at the Soft Practice of Managing and Management Development. San Francisco: Berrett-Koehler Publishers, 2004. Print.
•• Porter, Michael E. and Mark R. Kramer, “Creating Shared Value” <http://bit.ly/1l7UDrJ> Harvard Business Review, January 2011.Print.
•• Robin, Jennifer and Michael Burchell. No Excuses: How You Can Turn Any Workplace into a Great One. San Francisco: Jossey-Bass, 2013. Print.
•• Rother, Mike. Toyota Kata: Managing People for Improvement, Adaptiveness, and Superior Results. New York: McGraw Hill, 2010. Print.