As an Organizational Dynamics Expert, Consultant, and Author, Esther Derby talks about the fact that organizations should not strive to become well-oiled machines and that in order to be listened to, you must listen to others.
Every few weeks as part of The Heartbeat, I ask one question to a founder, CEO, or business owner I respect about their biggest leadership lesson learned. This week, I interview Esther Derby, Organizational Dynamics Expert, Consultant, and Author.
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CLAIRE: Hi everyone. I’m Claire Lew and I’m the CEO of Know Your Team: software that helps you avoid becoming a bad boss. And speaking of bad bosses, I’ve got with me someone who has advised and helped… [Laughs] No, Esther is possibly the opposite of a bad boss, but somebody who’s helped so, so many CEOs, founders, managers become better bosses. I have with me today Esther Derby, who is an organizational dynamics expert and consultant and whose work I’ve really admired and I love your writing. I love your thinking on so many topics. And Esther has written three books, all on whether it’s Agile Retrospectives and thinking through agile teams, behind closed doors, and the mistakes that a lot of leaders make, but most recently wrote a book called, I believe it’s the 7 Rules for Positive, Productive Change. So, we can definitely talk about that. It comes out I believe in August but you can preorder it on Amazon right now. But aside from working very closely with teams, in person I know Esther, you’re also developing an online course that’ll be coming out soon. And you got your start as a programmer. So your career has spanned all sorts of forms, but a real treat truly to have you here today. And I’m excited to ask you this one question about leadership.
ESTHER: I’m thrilled to be here, so thanks for inviting me.
CLAIRE: Of course. All right, Esther.
ESTHER: I’m ready.
CLAIRE: You’re ready? Okay. Here’s the question I’m going to throw at you. So the question that I’ve been asking leaders and thinkers who I admire is what’s one thing or several things that you wish you would have learned earlier as a leader?
ESTHER: That could be a long list, but I think one of the most important things was that organizations are not well oiled machines and expecting them to work like a well oiled machine is an exercise in futility and actually some can lead to really, I want to say horrible management decisions.
CLAIRE: Sure.
ESTHER: Because organizations are full of people who are messy and complicated and they don’t fit in neat little boxes. And if you’re not prepared to deal with that as a manager, I think it’s a really difficult job. If your expectations are that if everybody just does their job, all will be well, and we’ll work like a well oiled machine.
CLAIRE: Absolutely.
ESTHER: They just like that.
CLAIRE: I’m smiling right now because I think your insight is so astute about our very unrealistic expectation around team performance and to your point, humans, we are fallible. Surprise. We are messy. Surprise. I’m curious, you’ve worked so closely with so many brilliant, intelligent, savvy managers and leaders. Why is it that they don’t, I don’t want to say lower their expectations, but calibrate their expectations a little bit more realistically, like when have you seen this happen in the client work that you’ve done and maybe in your own experience as well?
ESTHER: I liked the word you chose, calibrate their expectations because it’s absolutely not about lowering.
CLAIRE: Sure.
ESTHER: But I think we had this legacy of thinking about organizations as machines and those are some of the earliest metaphors of organizations and most of the, well I wouldn’t say most, but some of the very early larger corporations were built around machines and having people in service to the machines. If you think about the textile factories in New England. When people started moving away from being individual artisans to working in these big companies manufacturing material, the people were in service to the machines. And so we have this sort of legacy of thinking about organizations as machines and decomposing them into their parts and if each part does their part, all will work. And it doesn’t work that way with humans.
CLAIRE: Is there a better analogy than the machine? What do you think is more accurate?
ESTHER: Some people use the term ecosystem which I think also has its shortcomings, but I think it does lead to more holistic thinking about organizations.
CLAIRE: I really appreciate that nuance and just the historical perspective because to your point, like it’s based off a very outdated model and a really outdated context. We aren’t in service to machines. We’re in service to a cause. We’re in service to the folks who are working alongside or to customers that we want to serve. I know there’s some academic scholars, I believe like Margaret Wheatley is one of them who’s talked about likening organizations to organisms into living beings. I forget who sort of talked about this, but the idea that teams in organizations are also, they’re not just a collection of people, but they’re also a collection of every single person’s past experiences. The individual dynamics, the relationship. It’s actually, it’s also just not people. It’s personality. It’s like every worst boss each person has had is playing out in some way in a team. So this expectation that it’s just a well oiled machine is so not true.
ESTHER: There’s an interesting quote from Ackoff that I think talks to this. It says an organization is not the sum of its parts. It’s the product of its interactions, which says it really is about how people and groups and functions and subsystems within the organization are interacting that determines how effective the organization is going to be.
CLAIRE: Absolutely.
ESTHER: That’s top of my list. You know, just not a mechanistic thinking.
CLAIRE: Yes. I’m so grateful for it. I mean, along those lines, one of the things that and how I originally first got to know you by the way, is through one of the cofounders of Basecamp, the CTO of Basecamp, David Heinemeier Hansson is a big fan of your work. And so, he’s the one who said, “Claire, you’ve got to talk to Esther.” So, we invited you to be a part of Know Your Team, our Watercooler community and you’ve been an amazing contributor there. And so we had you on there for an AMA, an ask me anything. And one of the things you talked about is right in line with this idea of stepping outside this mechanistic thinking, which is you said that one of the biggest things, if not the number one thing that leaders struggle with is getting out of their heads this idea that they have to extract maximum value. Tell me more about this because I think it’s related. I think it’s somehow interconnected to thinking that if a team is a machine that I must get the value from the machine, but tell me more.
ESTHER: Another way that I sometimes talk about that is that we have this embedded idea. I mean, I don’t think most people consciously think this, but it’s sort of embedded in management practice that we have to extract maximum labor for people from people. And I have talked to managers who said, “My job is just to get people to work hard. If I’m not getting them to work hard, they won’t.” It’s not so common. But I think it underlies many aspects of the way we think about getting people to work hard, what our job is as managers. And I think our job as managers is really to make it possible for people to do good work and to create the environment where doing good work is kind of the default.
CLAIRE: Absolutely.
ESTHER: So it’s not about making people struggle or getting them to work hard.
CLAIRE: Totally. So, what are these symptoms or the things that you find managers saying or doing when they are in that mindset of the wrong default of must extract value, must just get them to work. I mean, what I’m trying to get at here or what I’m wanting to share with the listeners or for folks who are listening, am I accidentally just focused too much on the wrong thing as a manager? Am I focused too much on must just get them to perform.
ESTHER: It’s, I think, a difficult thing to bring to consciousness because as I said, I don’t think most people consciously believe it, but I think a lot of that is kind of baked into management practices. And if you think about how we account for productivity, if you think about how we account for utilization, all of those things sort of have baked into them the idea that we have to get people to work hard, we have to be on top of them. So, it’s baked in. And if you can have the awareness that, “I have to check these practices and not just accept them without critical thinking,” I think that goes away to help.
So, if a manager were to find him or herself focusing on task completion or are people putting in, are they here at the dawn of eight and are they staying till five and are they taking too much time for lunch, and that person over there staring into space. Those might be some clues that you’ve absorbed this. Not that it’s the core of who you are, but did you absorb this thinking, this extraction of labor thinking. I mean, particularly in our work, software, there are long stretches of time where it looks like you’re not working very hard. Were you thinking? Were you discussing an idea with somebody else? I mean, it doesn’t fit that idea that people have fingers on keyboard typing frantically. So, I think we have to recalibrate around that. That word you used, recalibrate.
CLAIRE: Absolutely. I’m wanting to provide at the same time, maybe a counterpoint or a devil’s advocate question. So if it’s not about extracting value, yet at the same time as a team, we’re trying to achieve outcomes. At what point does accountability come into play? Like what should you be doing? How do you then create the right environment to get the results if you’re not thinking? How am I supposed to know what the results are if I’m not tracking people’s time or if I’m not just focused on task completion?
ESTHER: Oh, time and results are not necessarily connected at all.
CLAIRE: I agree with you.
ESTHER: Butts in seats isn’t going to get you much. So I think it’s important for people to have clarity about what problems they’re solving for what group of people? What is the challenge that they’ve been asked to meet? That’s super important. That’s motivating. Meeting a target, not so much. Meeting a deadline that seems arbitrary, not so much.
CLAIRE: A reason to achieve. Yes.
ESTHER: If it feels meaningful to people, people will work hard. People talk about pressure and putting pressure on people and they often do it through arbitrary deadlines, artificial deadlines, tying performance to some kind of bonus and so forth and so on. But the sort of pressure that really motivates people is the internal pressure of ‘we want to solve this problem’ because it’s meaningful, because it’s important, because it’s challenging. So then people will work.
CLAIRE: Yes, absolutely. What is so wonderful about what you just shared is you are assuming that people have intrinsic motivation, which I think is like you’re assuming, right? It’s like, “Oh, shocking.”
ESTHER: They do until we kill it.
CLAIRE: Exactly. I’m right with you and I’ve done so much research and writing and studying on this topic, but I find it fascinating is to your point, we unintentionally, you know, when we think about just okay, imposing pressure control, right? We unintentionally disregard the fact that people are actually have their own hopes, dreams, desires in our interest in equally motivated and driven. They are not, I mean, this goes back to the very first thing you mentioned. They themselves are not machines. So, what would you say, I mean in all the client work that you have done and the books that you have written, I mean, would you say this is the thing that leaders struggle with absolutely the most? What are some other things that you feel like in addition to just trying to extract maximum value that people struggle with? The managers that you work with? What are the conversations that you tend to have with a lot of your clients where you’re like, “I see this case so clear. Like diagnosis A.”
ESTHER: I think that the mechanistic thinking drives a whole set of issues when people think about the organization as a machine. And the other is how you have difficult conversations with people.
If people are behaving in a way that seems odd or you don’t understand, how do you have conversations with people? Or if people are, for whatever reason, not contributing in a way that seems appropriate. How do you have those conversations?
CLAIRE: Why do you think we struggle with those kinds of conversations so much? We seem to actually, the conversations that do seem to be the easiest for us as managers and leaders is, “Here’s what we’re going to do,” or, “Here’s what I think.” Why do we struggle with, “Oh, there’s a conflict here.” “Oh, I need to give this person difficult feedback.” What’s behind them?
ESTHER: Well, I think part of it is we haven’t been taught how to do it. We may have watched our teachers, our parents, our managers. And our teachers and our parents are talking adult to child, that’s not appropriate in the workplace. So that may be what we learned. So that is part of what makes it difficult because when people are talking to like children as if they’re children in the workplace, they either resent it enormously or they start falling into the role of being children, often unconsciously or both. And then you have another big problem. So, most people don’t love conflict. And so I often reframe conflict as it’s a negotiation. Conflict is just [crosstalk] and so there’s some expectation that is not mutually held here. So, that’s a negotiation. So, that’s part of it. And part of it is I think people are afraid of what’s going happen.
CLAIRE: Yes.
ESTHER: They’ll either cry or they’ll yell or…
CLAIRE: They won’t like me anymore.
ESTHER: They won’t like me anymore. All of which are possibilities. But it happens far less often than people fear. I’ve had conversations with people where it’s like, “Oh, I didn’t know that. Thank you for telling me.” As often as I’ve had conversations where people get upset.
CLAIRE: Exactly.
ESTHER: More often.
CLAIRE: I think we fear surprise, we fear the unknown and what we don’t often recognize the flip of that, which is that we could also be pleasantly surprised that the unknown actually might be good.
ESTHER: Or we wait. We don’t talk about it when it’s small. We wait and wait and wait until it’s big and then people blow up. I mean, this whole thing about year-end feedback drives me nuts.
CLAIRE: Yes.
ESTHER: Because then people are in the position of feeling like, “Well, if I’ve been doing this all year, why did you wait until now to tell me? Did you want me to fail? You must have or you would have told me so I can do something.”
CLAIRE: Totally, I love your mention of the year end review as well, because many ways, we have sort of organized and shuffled all of that hard, difficult conversation, icky stuff we don’t want to talk about. I mean, truly for selfish reasons, it’s because we don’t want to think about it and do the hard work of figuring out, “How do I communicate this, how do I share this?” And so, to the detriment of this person being shocked or frustrated that they’re not knowing about it until later. And what we don’t realize is while it seems easier or convenient or more placating to ourselves, it is truly a selfish move as leaders to wait to deliver feedback.
ESTHER: Yeah, it’s self protective. This is not totally on this topic, but it reminded me of this. I worked at a client several years ago who they kept saying, “This is our number one priority project.” And I’d look at it and I’d say, “They are the people assigned to this part time and things aren’t getting done.” And so, I’d ask more questions. And it eventually turned out that it was their number one project after 11 other projects. So, they made a distinction between, it’s our number one discretionary project versus it’s our number one required project. So, it was actually about number 12. So, this group had at minimum 13 projects going on at any one time. So I had these conversations with this senior manager in this organization about how are people actually getting things done. “If you have any projects in the house, do you do them all at the same time? How does that work?” “No, no, I would never do that because nothing would ever get done.” And I said, “Why are you doing it here?” And he says, “Because if I tell anyone that their project is not being worked on right now, they’ll get mad at me and they’ll yell at me. So I could have people yelling at me every week or I could have people yelling at me once a year. I choose once a year.”
CLAIRE: Wow!
ESTHER: It was really revealing. That was his whole strategy. I’m just going to kind of placate people all year long and tell them, “Oh yes, we’re working on it. Oh yes, we’re working on it.” And then at the end of the year, honestly not much would have gotten done, but piss pain was limited to…
CLAIRE: Exactly. It’s self protective to your point. And I think what’s so interesting about that story, Esther is obviously, I’m sure people who are watching or listening to this are going, “Oh my gosh, what a terrible manager. What a huge demonstration of someone who’s completely inept. I would never do that.” And yet, it is actually just an exaggeration of something that is very small that many of us do on a daily basis. We think we have a piece of feedback and go, “No, not right now. I don’t want someone yelling at me right now.”
ESTHER: He was an intelligent guy. He was a smart guy with a good education and good intentions. And he was a product of a system he worked in where he would get this list of priorities at the beginning of the year and it was the expectation that his teams would be working on them all the time.
CLAIRE: Yep. And again, a result of the mechanistic thinking and assumptions that we were touching on earlier.
ESTHER: I think most people who run factories would not try to run 13 different jobs at the same time if they weren’t set up to do that.
CLAIRE: Exactly. The product, like you’re saying, of a larger system, like there is something organizationally that is set up as structurally for this person to think that this is the best path forward. And yet to an outsider, it’s obviously completely off. So for those managers or for the other clients that you’ve worked with, what do you recommend in terms of having these difficult conversations? Or what do you recommend to get rid of this protective instinct that we have when we’re faced with tough calls or decisions or feedback to give.
ESTHER: I think first, it’s important to acknowledge your part in it. So if somebody is off doing the wrong thing, did you actually give them sufficient information? Did you actually have sufficient feedback loops so they could self correct?
I’m fond of Lewin’s equation of behavior as a function of the person and the environment. So, was there an environment there for them to actually do a good job and that often means, did the manager set this up in a way that the person could be successful? So, own your own stuff. And the second part is to have objective data. Now, as humans, we can’t be 100% objective all the time, but it’s super important to (1) have data and then strip as much of the value-laden, value judgment, language out of the way you deliver it. Not labeling someone rather than just, “This is what I’ve observed. I’ve observed that we agreed on this deadline and we talked about what went into the work and I’m noticing that it has slipped six times.” And then allow the other person to have some input. Maybe something was going on that you didn’t know about. So, own your own stuff, have some objective information and be able to articulate the impact because if you can’t address the impact, then you’re just being arbitrary.
CLAIRE: Exactly. There has to be some context and relevance into to why this even matters and to why you’re even sharing this to begin with. I love that.
ESTHER: I talked to a woman once who was told on her annual review that she was too nice. What can you do with that? You can’t do anything with that. It was a label, an evaluation. It didn’t have any specific details that she could recognize herself in and it had nothing of an impact. So she couldn’t do anything about it except feel like she’d been blindsided.
CLAIRE: Quite a tremendous example. I wonder how many folks who are listening to this are thinking, “Oh, actually, I may have given someone that kind of feedback before.” I mean, we’ve all been guilty of it.
ESTHER: No, because we haven’t been taught how to do it.
CLAIRE: We haven’t. We haven’t been taught.
ESTHER: We model what we have observed or what sorts of feedback we’ve been given.
CLAIRE: Right. We are a product of our environment, like you were saying.
ESTHER: Yeah.
CLAIRE: Esther, here’s the thing. You do a lot of writing, you do a lot of speaking. What in this whole world of management literature and thought leadership, what do you disagree with that maybe most other folks sort of tout in their blogs and books? Is there any sort of conventional management wisdom that you go, every time you hear it, you go, “No, no, no, no, no. I don’t agree with that.”
ESTHER: Where does one start?
CLAIRE: Yeah. I mean, you’ve written three books about all sorts of things that you’ve pointed and observed.
ESTHER: I can’t answer that question directly, I’m going to tell you about a book I read that has helped me understand some of the origins of management thinking.
CLAIRE: Yes.
ESTHER: So there’s a book, it’s written by a historian and she was actually researching, I believe it was the history of accounting, which sounds really boring. Doesn’t that sound really boring? In her research, she came across the ledger books that had not previously really been considered as part of the history of management or the history of management and accounting. And they were ledger books from sugar plantations [inaudible] where they had very, very sophisticated accounting methods about extracting maximum labor and maximum production from humans.
CLAIRE: Wow.
ESTHER: It is from that same management milieu that scientific management emerged. I mean, it may not be a heavy straight line, but it was from the same milieu.
CLAIRE: Heavily influenced at the very, very least. I think researchers can go back to, I think Aristotle who is sort of the first person to sort of categorize leadership. But this is incredibly influential though for the way we’re thinking then about management then in the coming years or since then.
ESTHER: Historians of management pegged the origin of management to the railroads, but there’s a scholarship that says it’s actually on plantations where enslaved people were doing the labor. So, if you think about that as being in the family tree, I don’t think it’s in front of anybody’s mind these days or these people, it’s not front of mind.
CLAIRE: Fingers crossed.
ESTHER: So it’s not front of mind, but it’s in the family tree and so it’s embedded in practices. So I think it’s always worth, whatever topic comes up, it’s worth thinking, will this actually create the environment where people can do great work? Are we making it easier for people to do work? Are we giving them the clarity and the conditions and the constraints that will help them do great work versus are we just doing management practices because that’s the way we’ve always done them.
CLAIRE: We’ve been told that this will get us X, so we just followed.
ESTHER: It’s our received wisdom.
CLAIRE: Yes.
ESTHER: Passed down from our managers taught in management school.
CLAIRE: Brilliant. Incisive insight. Truly. Especially what you said right there – received wisdom. We, I think, blindly as leaders swallow, “Oh, this is the best practice.” “Oh, we need to be doing performance reviews once a year.” “Oh, we need to be time [inaudible].” There are things, like you said, as received wisdom. So I love this idea to understand what is a part of the family tree? Where is this coming from? And that everything has context, doesn’t work for every single person. And to your point, dig deep around, is this actually making work easier for people?
ESTHER: Yeah.
CLAIRE: Who knew?
ESTHER: It’s a complete shift in how people think about things. Can we work harder to work hard versus how do we make it easy for people to do great work?
CLAIRE: Yes. So here’s the thing, Esther, I have tons of questions that I could continue asking here, but I want to end with the book that you just recently written.
ESTHER: Yes.
CLAIRE: The title really drew me in. So the title is 7 Rules for Positive, Productive Change. And I believe the subtitle is something to the effect of micro shifts, macro impact. And forgive me if I got that incorrect. Was that close?
ESTHER: Pretty much.
CLAIRE: Okay. As long as it’s close, but I was so intrigued by that. What do you mean? What do you mean by this? And tell me what caused you to write the book as well. Sorry, two parts there in that question.
ESTHER: Well, maybe it’s because one of those things such as management advice that always just gets me going, but I disagree with this.
I think a lot of the received wisdom about change often makes change harder. There’s an emphasis on pushing and persuasion and power, sanctions, punishments, whatever. People get labeled as resistors if they don’t change as quickly as people want them to. But the reality is people change all the time.
CLAIRE: Yes. We’re always changing constantly.
ESTHER: Yeah. So it’s not that people are resistant to change per se. They may be responding to being coerced or being pushed, being asked to do something that will make their lives more difficult or that’s being piled on top of them, or that they have tried before and it didn’t work. Or they know something has been overlooked or sometimes because they just don’t like the person who’s bringing it. I mean, there can be a ton of reasons. So this is a human and complexity informed approach to change. So it looks at how do we make it easier for people to change. How do we engage them in a change rather than trying to push people or position people in such a way that if you don’t do this, there’s going to be sanctions. So that’s what it’s about.
CLAIRE: Love it.
ESTHER: And acknowledge that systems don’t jump. A lot of change efforts, it’s like people think it’s a hockey stick. “We’re going to go along and we’re going along, we’re doing change, things will go like this.” That doesn’t happen.
I think a better metaphor is forest succession, which forests come into being through a series of steps. It may start as bare grounded rocks and then a few shrubs come in and then some shrubs that provide a little bit of shade come in and that creates a little more moisture in the soil and a little shade, so some different things can grow. And at the end of that process of many steps, you have a forest and that’s more like how organizations change. You can’t just slap a new process on something. You have to help step through those succession.
CLAIRE: It’s incremental. It compounds slowly though over time, but that’s how the gains happen. I love that. What would you say if there’s a tip you could share about how do we make one of those small changes? Is there one small thing that we can do to encourage the incremental change instead of expecting that hockey stick growth, especially in an organization or a team. I get this question a lot, for example, from the managers that we work with of how do I get my team on board with this new idea or changing the vision of the company or starting a new product. Like how do I make those changes?
ESTHER: Oh, how do you get them to be interested in some new idea?
CLAIRE: Yeah. Getting by in, I think is possibly one of the most common sort of requests around change.
ESTHER: Well, that makes me think of another story. You know I have a million stories.
CLAIRE: Yes. I love it.
ESTHER: Here’s how not to do it. I was working with an organization that had decided they wanted to “go agile”. And people were just wondering, “What’s up with this? We don’t understand.” They’re just throwing everything up in the air. So I talked to the CEO and said, “It would really be helpful if you explain to people why this was important.” And he said, “Oh yeah, I get that.” And then he went downstairs from his office in the [Elysium]. He went downstairs where the development team was. He went literally downstairs and said, “You know, we have to do this because my birthday’s coming up in June and this will be my birthday present.”
CLAIRE: You’re kidding.
ESTHER: No.
CLAIRE: Your stories, Esther, I’m like, every single one, I’m like, Wait, what? Really, it happened?
ESTHER: Yeah. It was sort of astonishing. So, that’s not going to work.
I think one of the best ways to get people to listen to your ideas is to listen to their ideas. If you want to get people on board with some new way of doing something, find out what’s going on for them and what they’re struggling with, and then maybe you can position what you’re doing as, “And this is how this might be helpful.”
CLAIRE: Connecting the dots for them.
ESTHER: Yeah. Connect the dots. Or if it’s to start a new business initiative, help them understand what the bigger context is. “We’ve been using this one product for a long time and our sales are going down and we realize the technology is changing. If we’re going to survive, we have to do something else.” So, that’s again, connecting the dots with the bigger context.
CLAIRE: Yes. I love the connecting of dots here though into specifically two dimensions. Internally, so for this own person, what are their goals, dreams, desires. Again, going back to intrinsic motivation, something we touched on earlier. And then I loved your idea of connecting the dots broader externally, making sense of the environment. It’s been written quite extensively about how one of the primary jobs of a leader is sense-making.
ESTHER: Yes.
CLAIRE: Helping to sort of clear. Yeah, exactly. I believe it’s Karl Weick who’s written a lot about this, assembling sort of the picture, so people go, “Oh!” This is a painting of a mountain in some fields instead of like, “Wait, what? What’s going on? I don’t understand. I don’t see, I don’t get it. This is confusing.” So both that internal and external connecting of the dots.
ESTHER: A lot of the ways, particularly senior leaders often taught — no, not all of them obviously, but often talked about the external lists, they talk about it in abstracts. “We want to be number one in the market. We want to increase our marketing by this stuff. We want this much. We want to change our revenue figures so that it’s revenue per person.” Who gets behind that? It’s not very engaging for most people. So if you want them to be engaged, you tell them a story, a true story, but you have the narrative that creates that connection between the problem we’re trying to solve. Whether it’s staying in business or whether it’s solving some significant problem for your customers or making a difference in the world. Like creating that connection, creating that narrative for people I think is super helpful.
CLAIRE: I could not agree more. And with everything that you’ve shared so far, Esther, I’m over here nodding to just everything. Thank you so much for sharing your wisdom, for debunking the wisdom that is just simply received wisdom and for writing your books and sharing everything today. So, appreciate it.
ESTHER: Thank you for inviting me. It’s been really lovely talking with you.
