In this incisive and practical book, Tom McGehee reveals techniques he developed in Ernst & Young's Accelerated Solutions Environment (ASE) to help companies achieve radical innovation. Whoosh presents groundbreaking formulas to bring about sweeping adjustments in business, and guides organizations to jettison deadwood ideals in favor of a focus on the cutting edge. It offers a blueprint for a better type of organization-called a Creation Company-that generates ideas by the truckload. Creation Companies do not hesitate to abandon the industrial age artifacts-best practices, mission statements, policy manuals, etc.-that place false barriers between people and achievement. Whoosh will lead companies, and the individuals within them, to strive for and ultimately achieve the state of Whoosh that will transform the workplace right before their eyes.

Chapter One

The Whoosh

When the age of the Vikings came to a close they must have sensed it. Probably they gathered together one evening, slapped each other on the back and said, "Hey, good job."

--Jack Handy, "Deep Thoughts," from Saturday Night Live

At a sales and leadership meeting, the head of sales at a Fortune 500 company went over the previous year's sales and set out next year's expectations to an audience of five hundred people who had spent the entire day listening to Power Point presentations. He pushed back from the podium and paused. When he started speaking again, he sounded excited. "When I think about the scale we have, our depth of resources, our experiences, how the market perceives the value we deliver, the capabilities of our people, the opportunity we have in the market today, and our possibilities as a company, it feels to me as if a giant whoosh of capability and potential is just waiting to explode out of this company."

    The whoosh he's talking about is not just excitement. It is also confidence, anticipation, eagerness, and a sense that nothing can stop you. At CGE&Y I work with some of the world's most highly motivated executives. I've been fortunate to be able to spend my time collaborating with CEOs and managers, who are tremendously excited about the possibilities for their companies regarding opening markets and new technologies--and about the personal opportunities offered by the general surge of entrepreneurial activity throughout the entire economy. Everywhere business-people look there are opportunities: opportunities to start companies, small and large, opportunities to pursue intriguing jobs outside the traditional corporate path to success. We've all learned in the past ten years that there are many more ways to be successful than climbing the corporate ladder. In the early 1990s everyone knew someone who'd been laid off; now everyone also knows someone who's become a millonaire overnight.

    Our thinking has shifted, from being reactive to being proactive. What's attractive is not just the idea of making money, but of being able to personalize your own opportunity and to define your own success. There are so many opportunities--and so many new patterns for success--that you have to think about what paths to take. Is a slow steady ascent through the organizational ranks really the only way? Am I being maximized as a person? Do I feel I'm having an impact on my company? Is my organization creating new opportunities for me? Is my company growing, and do I have the opportunity to grow with it, or is it constricting and I'm just asked to play a pre-scripted role? Increasingly, people are looking for more than conventional success. Their goal is to make a difference, to have an impact in their market, in their industry, in their organization. People want their work to matter, to express something that is personally important.

    When the dot.coms started to crash and burn, and the New Economy started to look a little more like the Old Economy, I began to wonder whether these new attitudes towards work and working would change as well. Peter Drucker says that, for the first time in history, knowledge workers are outliving their industries. In spite of the shortening life cycle of companies and industries, knowledge workers remain in demand. Because of this, knowledge workers are more optimistic--they assume that they will be learning new skills throughout their careers. Change doesn't phase them--they like it! This adds up to an amazing shift in people's expectations for what companies will provide. The traditional, if unstated, social contract between employees and companies, that people would relinquish a part of themselves for what a corporation provided--stability, career, recognition, and so forth--is a fading memory. Corporations don't provide it anymore, and employees, learning that their skills are more durable than their companies, are refusing to accept the limitations of the traditional workplace.

    When expectations change, so does behavior. A friend's son works for a company in Austin. When his Dad asked him how things were going, he said, "Well, they're really cracking down on us--they won't let us bring our dogs to work any more." That is a ridiculous statement to someone who is used to the traditional corporation-employee arrangement. But it is a perfectly logical remark for someone who is unencumbered by the old-fashioned point of view and may very well be thinking: "The company has to adapt to me. I am very important, because I will be here longer than any one company or industry will be." Really, it's a new generation gap. I told this story to a group of professors and students at a university. The professors all shook their heads with exasperation; the kids all nodded in recognition.

    As far as I can tell, the Corporate Myth is truly dead. In the early 1990s, many people felt that the most prudent path to job security was to keep your head down and try not to get re-engineered. Those were depressing times that fueled a feeling in the corporate world that "It's not safe here anymore; I need alternatives." Then came the dot.com explosion, which seemed to be the magical solution everyone was looking for. Soon enough, people began to evaluate companies in ways that were, as someone I know said, "way north of stupid." People wanted something new and everyone jumped, ignoring a lot of sound business practice in the process. We all know what happened next.

The Nature of Work

I know many people at large corporations are breathing a sigh of relief, thinking the start-ups that have been winning the competition for the top talent in the past few years are now out of the game. My advice is that they should think again. If corporations believe they can keep talent like my friend's son by providing the same old cookie-cutter jobs, in the same old conformist cultures, they're in for a shock.

    They're in for a shock because what's changing is the nature of work--what companies need from individuals, and what individuals need from companies, is different today from what it was a decade ago. Three converging trends--one cultural, one technological, and one structural--are changing everything about what we do, how we do it and, perhaps most important, why we do it.

• The cultural trend is, as described above, the Death of the Corporate Myth. There are no jobs for life, no careers even, not in the traditional sense. Individuals' relationships with organizations are flexible, personal, and idiosyncratic. The strongest bond between an individual and an organization is the quality of the day-to-day work experience.

• The technological trend is the rapid rise of portals for real time, instant information sharing and Internet communities. Working in real-time--now--makes it impossible for any one individual to control or know everything about anything. Expertise becomes less important than the ability to learn. Individual performance becomes less important than the ability to raise the performance of a network.

• The structural trend is the change of organizations from stand-alone hierarchies to interconnected webs of alliances, partnerships, and outsourcing relationships. Leading a web organization is fundamentally different from leading a hierarchy, because most of the resources and people in a web organization are outside of the leader's direct control. Leaders must somehow keep their organizations focused and performing at the highest possible level, without any of the tools of traditional command-and-control management.

    The cultural change in why we work is best understood by looking at business patterns over the past decade. The late 1980s and early 1990s began a pattern of business restructuring that demolished the balance of an individual's personal return on their corporate investment. What I mean is best illustrated by two stories; both involved speaking with younger university students and new entrants into the workplace.

    A "Generation Xer" spoke to a group of church pastors about religion and faith, a subject that may not seem at first to have much to do with the workplace. Her answer to a question about faith, however, demonstrates the far-reaching effect of the era of restructuring: "When you say `faith,' we hear `don't think.' Remember, we are the generation that was raised to believe that promises are made to be broken. Over half of the families we come from are divorced. We have seen too many leaders fail, and experienced too much pain to just trust in your words. We have watched our fathers lose their jobs, and our mothers struggle to be rewarded for their performance. You want our faith? You have to earn it!"

    What is the moral? The "faith" that past business and organizational successes will lead to future business and personal success is gone. It used to be that you could see your future career from the day you started college. Now, it is altogether possible that the industry you wanted to work in when you started college will no longer exist by the time you graduate.

    The second story shows just how widespread this thinking is. Speaking at a university, I recently asked a group of students, "How many of you know someone personally that lost their job due to some type of corporate re-structuring, rather than individual performance?" Almost every hand went up. When asked what reflections this inspired in the audience as they prepared to enter the workforce, a student replied, "You have to fend for yourself."

    That is the story of the 1990s. People fended for themselves and were very, very good at it. The mid-1990s ushered in a tidal wave of entrepreneurship and individual wealth creation. When people start to fend for themselves, they worry less about conventions as they become absorbed in the search for new opportunities. As it happened, many new possibilities were aided by technological innovation. Dot.com millionaires abound, demonstrating "proof" rather than "faith."

    As we enter the new millennium, this recent history is at the forefront as we consider why we work. Even with the collapse of many of the startups and the decline of the ever-fickle stock market, our perception of our personal return on our corporate investment is forever changed.

From Connection to Collaboration

As mentioned, the second trend is a technological one. Technology both enables and restricts, but it affects every part of our business and our lives. One way to sum up this change is to talk in terms of our society's movement from the Industrial Age to the Information Age. This is a useful distinction, but to concentrate on the change from Industry to Information alone is to miss the point. Access to information is not enough for success in the Information Age.

    Leaders now have more data, and more ways to remain connected than ever before. They can be reached virtually anywhere in the world at any time. Just a few short years ago it was necessary to take special steps to stay in touch; now it's just the opposite. But, never confuse connection with capability. Being connected only provides the potential to share information. Taking responsibility, making decisions, and doing so at a rate faster than the competition, is enabled by connection, but it isn't accomplished by it. My daughter calls me from college. She and I are connected. Do you think she tells me everything she's doing in college? Not likely.

    Connection isn't cheap. Businesses have spent millions establishing connections and building electronic infrastructures. Everyone has pagers and cell phones and Palm Pilots. All this means is that they can share information. If they lack the ability to collaborate, they will not be able to do much with it. Like anything else, information can be misused or it can become a burden. What are we really doing with all this connectivity? Is it really helping?

    What's becoming more important than simple connection is the ability to collaborate through technology. Portals and other Internet technologies give us great abilities to share information, but if people don't have the mindset that sharing information is good, then it doesn't matter what the technology does. More and more information-management systems are seen as value. People will soon be expected to be more collaborative, because collaborative behavior is the only way to maximize the value of these sophisticated enterprise-wide information systems. It's still just under the radar, but it is coming. Some people will have a difficult time adjusting to working collaboratively. It is not a change that only the organization has to go through--it is a change that you and the organization have to go through together.

    Computer networks have their own collaborative filters and their own feedback loops. At Epinions.com, for example, you can post your opinions and expect readers to respond--then you build on their responses. The impressive thing about Napster is the ability to share files without building a database--their software searches the computers of all the people who are connected to the system. This is the kind of collaborative ability that would allow, say, the people in a company to search, real-time, the data on all the computers in the company. This is technology that forces collaboration. You no longer have to know who worked on a certain account two years ago, get an introduction, and schedule a meeting. All you have to do is input a search term, and you quickly get to that information. This makes a huge difference in how we work. We are moving from a work culture in which hoarding information was a source of power to a work culture in which hoarding information is impossible (and useless).

    This is going to be a shock to people who are not used to collaboration, because it is a profoundly different way of working. It's like a technology ad I recently saw in a business magazine. A business man holding a sign that says: Collaborate or Die. The point is, technology vendors understand that the shift is actually here; the technology is ready, if people are willing to use it.

    Connecting parts of a system creates the ability to share information, but simple connection doesn't address whether that information is useful or not, or of good quality or not. When people are connected, they can send each other information, but can they use the information? Can they do something--anything--with the information? Because communication is easy, the tendency is for people on the front lines to wait for approval before moving a muscle. They are afraid to decide or take action for themselves. It's ironic that, in a time when so many people, including me, are proclaiming that hierarchical organizations are artifacts of the past, many companies have communication policies that in fact replace the old paper organization chart with an electronic one. Connection is not the same as decision making.

    People are buying the hardware and the software that make sharing and collaboration possible. But, if the first thing you think if you sit down at the keyboard is "should I share this information," you are throwing up the walls that block collaboration. To maximize the value of connection, people have to work together--they have to do more than pass information, they have to collaborate. Collaboration provides the right mindset and toolbox necessary to maximize the value of connectivity. When collaboration kicks in, you see a multiplier effect that greatly enhances performance.

    My experience has been that most people don't really know what collaboration-authentic, powerful collaboration, the kind that can push a company's performance to a higher level--involves. But, nonetheless, the meme is in the ether that the time has come to do something with the connectivity we have.

From Hierarchies to Web Organizations

The third trend that is changing the nature of work is the movement from hierarchies to web organizations. This is a structural change that affects both how we organize work and how we lead organizations.

    Companies used to be self-contained hierarchies; now they are web organizations that depend for performance on groups other than their core. Mergers, partnerships, alliances, and outsourcing relationships will continue to grow in importance. Business has fully embraced outsourcing, and I find few companies that don't employ some level of contractor support. Both business relationships are between a company and a supplier. It may be another company supplying hundreds of resources through an outsourcing relationship, or free agents. One industry analyst estimates that within the next ten years staffs in major corporations will be 50 percent smaller than they are today, because so much more work will be outsourced or handled through the creation of value webs. This shift is not just outsourcing for efficiency in a supplier-client relationship, but the creation of a web of partners that rely upon each other for consistent delivery of value to their clients. For example, when you call many companies, chances are the person you speak with isn't an employee of the company, but an employee of a call center somewhere. If that person is handling your customers, how valuable is that?

    In a living system or in a web, a hierarchy run by command-and-control leadership can not control the entire enterprise, so the way you operate best is by pushing the decision making as far out to the edges of the web as possible. This idea of "distributed judgement" means that leverage, power, and success do not come from accomplishing specific tasks with resources, but by understanding individual capabilities and allowing them to be maximized for the good of the overall system. This presents a challenge to leaders and managers.

    One executive I know faced this challenge when he created a business-to-business web organization with a half-dozen companies. He had to replace all of his managers because, while they excelled at managing with a command-and-control hierarchy, none of them were able to lead in a collaborative value web. This isn't an extreme example anymore; every company is dealing with some kind of relationship like this. Wall Street is watching; stock analysts now expect more than additional capabilities from alliances and mergers--they expect corporate capabilities to multiply.

    Ford recently announced that it would supply, for $5 a month, each of its 350,000 employees with a home computer and printer. To jump start the project, Ford CEO Jacques A. Nasser met with Dell CEO Michael Dell. Why? Here's what Nasser told Red Herring's Justin Hibbard:

First, because we are very eager to learn and have a dialogue with different industries and what would be non-traditional areas of business for us. Second, we've got a group of people within Ford today who have come from very diverse backgrounds--I'm talking about industries outside the automotive industry. And the third thing is that the world is changing. Just as markets are opening up the traditional view of "Well I have my own industry and you have your own industry and I won't show you mine and you won't show me yours." I think those concepts are gone because the world is becoming more interconnected.

    Nasser is supplying all that connectivity for a reason. The reason is that he wants Ford's people to weave themselves and the company into the fabric of a larger network that transcends the old boundaries of company and industry. Technology is the first step--but it is only the first step.

Creation Companies

Some companies are making the most of the changing nature of work. I call them Creation Companies. This is my term for companies that have the following characteristics:

1. A leadership style that emphasizes freedom, not control.

2. An understanding that success means creating the new, not replicating the old.

3. A work style that values individual expression and collaborative work, rather than a work style that values group conformity and individual work.

    Once people experience work in a Creation Company, their expectations for what they can get out of their work lives changes. A friend's son went to work for a Creation Company (a dot.com that unfortunately went out of business last year). Now he's working for another company, one that I would categorize as a Compliance Company. Compliance Companies have traditional command-and-control leadership styles, judge success by their ability to repeat past successes, perhaps in different markets, and have the traditional conformist corporate culture and individual performance values. Here's what he has to say about it: "I felt more alive, more excited and was having more fun when I was working those long hours for that start-up than I do now. And all I'm doing now is building my résumé and my capabilities until I get another chance at something where I can really make a difference."

(Continues...)

Excerpted from WHOOSH by Tom McGehee. Copyright © 2001 by Tom McGehee. Excerpted by permission. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.