If you haven’t read Fredric Laloux’s book Reinventing Organisations then stop now and read it. The book talks about TEAL cultures. Here are some examples of how we have used the concept of TEAL to change the way we think and do work. We love TEAL if you want to find out more about it then get in contact with us.
Cashflow and Teal
We started aiming for Teal when we didn't have much money but had a lot of outgoings. Our staff wage bill was 70% of turnover (£146,311 wages, £206,179 income). Senior staff had cut their wages to be level with all team members and the average wage was only £16500).
Every month we had a nervous wait to see if we could meet our targets, pay salaries and a large amount of effort was put into managing cashflow. All of this pressure was only held by two senior team members (our board was dissolved in the middle of February). It was stressful and took all our creative energy to keep moving. We lent money to the company, borrowed from parents and prayed a lot.
We are here to provide support for the most vulnerable and our Kingdom convictions told us that sacking staff would not release them from poverty and that putting more pressure onto staff would increase anxiety. We therefore acted like parents, smiling to the kids whilst fearing how we were going to feed them next week. We had become like a Foodbank recipient- nervous, feeling we had failed and worried about how life would turn out.
Teal came to our rescue.
This is what Fredric has to say about budgets in "normal" organisations Many traditional organizations go through a painful budgeting cycle every year, where they make revenue, cost, and profit predictions for the next twelve months. Front-line managers try to keep the numbers as low as possible, since they know that every month they will be asked to justify any shortfall. And top managers want them as high as possible, to keep the pressure on. Often, after tedious back and forth, some numbers are agreed upon that no one really trusts. The whole exercise is pretty meaningless anyway, when you come to think of it: for some reason, in a few months time, business will turn out to be much easier or much more difficult than expected, and so who can really tell if a manager that delivers 5 percent below or above targets has done a good or a bad job?
We were trying to build a social purpose with people normally ignored and yet tried to mimic "normal" organisations- not even realising that most normal organisations are not even very good at budgets and felt the same as we did!
Instead Teal offered management a new way:
But then, don’t people have targets? Well, no! None of the twelve organizations I researched has any form of top-down targets. (In some organizations, like Morning Star, people set their own targets, like a jogger might do to spur himself on.) Think of it: if you work in an organization where you have the power to make things happen, where you can bring all of who you are to work, where you serve some noble purpose, do you really need a carrot to do good work? If someone isn’t motivated, the problem is not an absence of targets. Something is causing that work not to be stimulating for that person. That is the problem that needs fixing. Simply adding targets won’t do it.
We set up a weekly cashflow spreadsheet. It told us what we needed to keep the show on the road. It was based on where we were. It allowed us to know when we would finally run out of money and die.
This immediately stopped us wasting time with complicated finance meetings. One person looked at the cash each week and filled in the data to the spreadsheet. This is not particularly Teal or special. But what happened next was.
After a few months we started to tell the "children" what was happening, how little money we had and how much we needed to survive. We started to write the Cashflow Target (CF Target) on the office white board. We also added the Moby Dick Target (Moby Target). This target simply outlined how much cash we needed each week to be breakeven and comfortable.
The initial CF target was £1700 and the Moby was £3000.
Something amazing happened. Without "management" telling them the team saw the reality (we needed more money), understood the consequences (we would have to shut down) and understood the basics maths (£3000 would make life comfortable). We didn't have to explain this they just got it.
All of a sudden we had a weekly game to reach £3000. The senior leaders weren't stressed as they weren't hiding the problem any more. The team agreed to come into work early every Friday at 8am to talk about our weekly plans- they were leading for us.
Without any intervention from above apart from some coaching and ideas support the team took on the challenge. Since February the team have grown the weekly income to well beyond £3000 and have been hitting the Moby target weekly well before management thought they would. Now we have a new target- Loch Ness- this is £8000 per week. It is now on the board next to CF and Moby and we trust that the team will understand why we need to keep growing ( to help more people towards freedom) and are now leaning into the growth.
Teal took the stress from top, shared it out to the team (treating them as whole, real people) and the team did all the work. We are now using TEAL to replace budgets with team and numbers with people.
Boards and Teal
Grace Network has had a small board from its inception. 2 men, then 2 men 1 lady, and then 4 men. It was created by thinking about what an organisation needs and then looking for people to join to offer their wisdom. Only one was paid the other 3 were voluntary. Some board members loaned money to the CIC some gave 10's hours per month and some just a few. It was a classic board.
Decisions were made by the Managing Director sitting and thinking of ideas, shaping a proposal and then bringing it to the board, they critqued the ideas and sent the MD back to redeisgn them. They met every 4-6 weeks and they the team didn't know all their names. Most junior team members wouldn't have been able to tell you much about them, although the board did have some members who regularly came into the office to be.
All the people on the board were clever, kind, generous and committed to the ideas that Grace Network was here to share Kingdom news for those who most needed it. However on February 19th 2018 the baord ceased to exist. All apart fromt the MD left the board. It was a painful process and has left scar tissue.
Why did this happen? Because it needed to.
We couldn't explain it but there was a problem between the board, the way it made decisions and the people who we were trying to help through employment.
Teal explains it. The process for making decisions and leading were at odds with the core purpose. Page 72 shows how things are done via a board.
However, for businesses with a purpose strategy isn't required in the traditional sense. Our business had a purpose and the board ultimately became a barrier to growth not becauase of the people but because it simply existed:
None of the twelve organizations I researched (all of which are remarkably successful) has a strategic document, a strategic plan for the next three or five years. That sounds crazy! Every business school tells us that strategy is the alpha and the omega of success. But then again, think about it: wouldn’t it be much more powerful if an organization constantly listened to new opportunities and adapted accordingly, instead of doing a big strategic exercise every few years and sticking to the plan in the meantime? So how does an organization continuously iterate on its strategy? There are a number of processes it can use. The simplest one is: do nothing special. Let self-management work its magic. There is a new vocabulary that often comes up with Teal pioneers: sensing. With self-management, everybody can be a sensor and initiate changes—just as in a living organism every cell senses its environment and can alert the organism to the need for change. We human beings are remarkable sensors. It’s only that in traditional organizations, most of this sensing is filtered out because only the signals that make it to the very top (after being sometimes heavily distorted) are acted upon.
We were desperate to sense our way forward but the board kept on dehumanising decision making and undercutting the staff on the ground's ideas.
When we went TEAL we were able to remove the board and yet feel like we have a bigger strategy.
On our wall sits:
Although times are hard
And they don't seem easy
We can help you change your season
You feel like autumn
Like the leaves are falling
Like life is a struggle every morning
The way you are living
Now can be changed
We can show you how
How to appreciate all you've been given
Find a new path
A new way of living
You've been living in a system that's failed
And now you feel trapped
like you've been jailed
Change is possible and after the hassle
You will be free
Released from the shackles
So now be free
You know what to do
And if you fail
We'll be here for you
This a team member's rewriting of Luke 4. It is the only strategy we have. It guides our decisions.
We have boards for each subsidiary but they only work to ensure basic meeting of legal and financial requirements. All the boards are open to all members. All team were offered a board place in June 2018.
Instead now we ask ourselves how can we do more of the poem. We are then free to try and innovate without needing to go through a board process. This means any team member can come up with a plan, change a process or suggest new ideas. It works as the companies now grow like a plant. Reaching towards the light.
However, we still have some unanswered questions:
1. How do we make sure we don't go bankrupt as people grow their business?
2. How do we finalise a decision?
3. How do we resolve arguments/disagreements?
4. How do we keep everyone engaged?
Black Swan's and Teal
How do organisations react when random things happen.
We had an amazing offer from the Council to access a new warehouse, just as we ran out of space. We had been praying for an answer and the Council gave us one. We have 5000sqft and were given another 5000sqft. However, we then had to respond and use the new space. The question was: how can we respond to this as a team and ensure we didn't fall out or waste the opportunity.
We took a view that the teams would know more of what they needed than the senior MD who negotiated the space. We just embraced this. The keys were given on the 12th October. We told the whole 20 person group that they had 4 days to come to one person with their best ideas. Van drivers, administrators, warehouse staff, managers, everyone had the same right and timescale to share ideas.
On the 16th October the ideas where given to one person. They then decided where things would go, who would get what space and the plans. On 19th the plan was simply drawn onto a white board (not to scale!).
Two other more logistically minded team members were given responsibility to the actual move. Between the 22nd October-26th October the whole warehouse was reorganised. We then agreed that we were 90% done. A different team member has been given the role of being the single point of contact for any last finishing touches ideas. They have two days to gather final thoughts before we complete the last touches.
The entire chaotic, heavy, hard move was done from keys to completion in 11 working days (and one evening). No one argued or said the way space was given out was unfair. We also managed to have a biggest ever week of sales in our Furniture Business.
We reacted with our poem- how can we do more of this?
We reacted by giving a voice to all
We reacted by letting one person decide what was best
We reacted quicky, without need for a big process, planning or inter-company arguments.