Thursday, April 8, 2010

The HP Way - The Science

"Decisions should be made at the lowest possible level"

Bill Hewlett and Dave Packard at some point decided to try a social experiment when they started their business. The key line of business was building tools. Oscillators, Voltmeters, assorted measuring equipment. They wanted to build better equipment that would allow others to build better things and they wanted to see if you could do this and still make money. They did.
They tried to make the world a better place by doing what they knew best. Making electronic equipment. But there is more to making a better world than just making the best equipment. Bill and Dave believed that a company had an obligation to it's share holders, it's customers, it's employees and the community within which you operate.

The employees.
Bill and Dave encouraged their employees to be creative, innovative and to take responsibility for their actions. They wanted people to be involved in the decisions, to give people a higher level of control than would be normal in business. They trusted their people. This is the secret sauce. Most humans respond well when they are entrusted. They feel worthy, needed, valued. If the company is 'shaped' well, there is almost a 'sacred duty' to do the right thing at work. The company becomes a team, a tribe.
Another thing Bill and Dave tried to do was flatten the hierarchy of command, or at least remove the intimidation and social strata aspects of management and employee control.

The payoff.
There are studies that show if people have control and support in their lives they are less stressed. They function better, their health is better and they are happier. By giving employees control as well as challenges, reward and support they were tapping into the strengths of humanity.

People working in an intimidating work place, rigidly following poor or misunderstood decisions or processes and having no control or worth have much higher levels of stress hormones, norepinephrine, cortisol and others. These affect attention, memory, blood pressure, vascular operation, alimentary function, immune system and endocrine systems. Whilst it may feel good to those at the top, it actually impedes creativity, innovation and efficiency. You are making your workforce dumber, sicker and unenthusiastic. Everyday, science is finding hard evidence of the drastic health effects of stress hormones on human physiology and the link between their work environment and stress hormone levels. The telomeres at the end of DNA seem to be damaged by stress hormones. This increases ageing and contributes to DNA damage. Cortisol has adverse effects on the distribution and metabolism of fat increasing atherosclerosis and other vascular problems. Stress hormones affect the operation of neurotransmitters and cells in the brain. The effects are far more serious than previously thought.

By giving their employees some measure of control, trust, realistic challenges and support, Bill and Dave hit on a natural winner. Everyone benefited. Really benefited. And the company went from a small company to a multinational giant. They started a revolution in science and technology and seeded silicon valley. They produced products, technologies and ideas that made the world richer and safer and in the process made their employees lives richer, safer, healthier and happier.

With so much anecdotal and hard evidence to support the HP way one wonders at the galley slave masters of business today and why business management schools consider the HP way as inefficient sentimental rubbish.

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