Why digital values and radical transparency will make your company stronger
24 May 2018
In 2009, after the financial crisis, Good Rebels – founded by my brother and sister – was struggling. Having left my previous job, I decided to join them to try and help. The first thing we needed to address was the business’s management and leadership principles. The problem was that the company (then called Territorio Creativo) was a boutique digital agency, but it wasn’t digital from the inside-out.
New working structures and increased self-management are now being demanded by younger and older generations alike; financial transparency, a reduction in salary inequality and unnecessary privileges between directors and non-executive workers, meritocracy, more conversation, a reduction in bureaucratic standards and procedures, remote work, and consensus on tactical and even strategic decisions.
In short, democracy and digital values (often present in online or open source communities and digital startups) are seeping through the walls of organisations, who are now required to become more human-centred. Hierarchy stifles innovation. Co-workers need to be treated as adults. In return, they offer commitment, passion and enthusiasm.
Transparency became a key principle of Good Rebels’ culture. On the one hand, it builds trust, on the other it helps decentralise decision-making; two key ingredients for self-managed companies.
The following milestones showcase our journey towards radical transparency:
- 2012: Rebel Outlook is born. The eight directors at the time hold monthly meetings which are open to every employee (known as Rebels). Project statuses, year-to-date financial results and other internal issues are shared in thorough detail. However, today with five offices and over 110 Rebels we connect via Google Meet.
- 2013/2014: The yearly 360º performance appraisal, called InProgress, is launched. Each Rebel is made aware of first-hand the quantitative and qualitative evaluation received by their peers. Results are shared on our internal network so that everyone can see the grades and feedback we’re giving each other. We had two goals; constructive feedback, and evaluation to guide salary rises.
- 2016: Salaries are shared internally. Every Rebel knows what everyone, including the directors (known as knights) and partners, is earning, including dividends and other perks. You can read the reasons behind this controversial move here.
None of these measures could be conceived in isolation; they work as a set of initiatives based on a very specific culture and seek to build trust among collaborators, strengthen meritocracy and, of course, foster autonomy.
What if employees decided their own salaries?
In the past few months, we’ve been running a pilot to implement a self-setting salary scheme, in order to encourage people to think like entrepreneurs, increase the degree of autonomy and decentralise a key decision, by tapping into the ‘wisdom of crowds’.
To keep it simple, a procedure in three steps over the duration of a month and a half, was set up. In the first stage, everybody would award points to people they thought deserved a raise. A predefined formula based on salary ranges and pre-allocated money buckets would assign the percentage of raise each person would receive.
A team of more experienced Rebels – called Knights – would review the process and adjust inequalities. Finally, an ad-hoc committee composed of five Rebels chosen carefully based on their level of authority would take care of any potential complaints.
The aftermath revealed several basic mistakes that needed to be corrected in future editions of the scheme. Since external case studies are not easy to find, we’re forced to break with status quo and learn from our own experience.
Is it really possible to have a company without bosses telling employees what to do and how much they’ll earn?
Today, Good Rebels is a digital (from inside out) and creative company based in five offices across Europe and Latin America. We deliver innovative professional services for companies including Toyota, Santander, IKEA, Spotify, Lexus, LG Electronics and Amazon.
We’re still finding our way to becoming more self-managed and digital from the inside-out; where growth doesn’t mean being less exciting or engaging. A place where we don’t have to abandon the idea of love in the workplace (something that is deeply ingrained in our Latin roots).
This article was previously published on B2B Marketing Ignite. Fernando Polo will be speaking at their upcoming 2018 conference on July 10th.