It’s a joy to be here. Thank you Henry for having me. We’ve been working with Happy for a long time and it’s a wonderful joy to be here. So, I was one of these weird kids that in fourth grade when I was about ten years old, during recess, when all the other kids would go and play four square or dodgeball or hang out on the monkey bars, I would take one-on-one appointments by the back fence with my fellow ten year old classmates counselling them on how to live their fullest potential in life.
I was weird, OK? I was weird, but I also had a sense from a very young age of purpose for my life. I really believed that we were all meant to live our fullest potential. Now, what form would that take in my adult life? Well fast forward through a number of years and my last year at university I was asked to be the director of our student affairs conference, which was a big deal at my tiny little campus in Illinois. I assembled a team of students to come together to think of what the topic should be. And I said, let’s make sure this topic is really consciousness raising and outside the box and progressively minded. Thinking I’m being a good leader I’m like, you guys come up with the topic. I’ll support whatever you decide.
So off they go to come up with the topic, do several months of research and they come back and they do this big presentation to me and they say, Traci we think we should do the conference on – drum roll – democracy. And I’m like, democracy? That is the worst idea I’ve ever heard in my life. I’m like you guys, how is this consciousness raising? How is this forward thinking? How is this any of this? Because to me democracy was two things: voting and old white guys in politics in Washington D.C.
And they said, yeah we thought that was the case too, but then we started to talk with these very amazing professors we had on campus. One was a quantum physicist, one was an education professor, one was an environmental studies professor, and they taught us that democracy is really about creating a system of organisation that releases people’s fullest potential. Democracy isn’t politics. Politics is – as I once heard someone say – working to advance an agenda at the expense of someone else. But democracy is creating an environment where people can realise their fullest potential, because you’ve given power to people in that way.
So as I connected the dots from being that ten year old and helping people to realise their fullest potential to what my colleagues were telling me, I started to fall in love with this idea of democracy. I’m going to talk more about what that means in just a moment. So all of this evolved and it turned out, my last year of university I started my company, WorldBlu. That was over 22 years ago – you can do math – and we now operate in 80 worldwide. I’ve worked with clients in 80 countries worldwide teaching them what we teach, which is freedom at work.
What we teach is this model called freedom at work. What we have found is, in order to build a freedom-centred rather than fear-based culture, it takes these three big picture things. Number one: it starts with the freedom-centred mindset. And as we’ve worked with top leaders and top companies like Zappos and Groupon and Pandora and Hulu and WD-40 and all of these fabulous brands all over the world, what we’ve found is that their leaders have an entirely different mindset when they come to the table. They’re bringing a freedom-centred rather than fear-based mindset.
Now if you bring a mindset of fear, what do you want to do? You want to control, right? So when you have top leaders who are in this fear-based mindset, which most of us are and we don’t even realise it, they’re going to go and create these command and control management structures. But when we have a different mindset, like what Henry does at Happy, you bring an entirely different way that you design and operate your company to work.
The second part of the freedom at work model is leadership – freedom-centred vs. fear-based leadership. Because if you’re leading a company this way, you have to lead it in an entirely different way and there’s several attributes that we teach with freedom-centred leadership.
I’m not going to focus heavily on mindset and leadership today, but I will give you a tip – a tip on leadership that took us probably 15 years to figure out. The tip is in order to build these kinds of freedom-centred cultures that we’ve all been talking about today, the number one thing is that top leadership must have high self-worth. I’m not saying self-confidence, OK? A person can have self-confidence but not have self-worth. Self-worth is being secure with who you are.
When we work with companies, I will sit point blank with the CEO and say, on a one to ten where’s your self-worth? Because if they’re not telling me an eight or higher and aren’t willing to work on it, we’re not going to be able to transform their culture. Because if you’re not secure in who you are as the managing director or CEO, are you going to go create an environment where everyone else can shine? Are you? Hell no! If you’re not secure in who you are, you don’t want everyone else around to do great.
Has everyone ever worked for a low self-worth leader? Right, we all have. If you’ve got a crappy boss, I’m telling you they’re low self-worth. That’s just how it correlates, OK. So I just saved you a lot of money. Only hire high self-worth people. That’s what you want to go for.
And the last part is design. This is where the ten principles of democracy come in and we’re going to talk more about that in just a moment. But the problem is that most of the time we’re operating in fear at work. Now we don’t run around saying, oh I’ve got fear. Most of the time we say I have stress, I have anxiety, I’m sick of all this bureaucracy that we’ve got, command and control, analysis paralysis, perfectionism, bad communication, distrust. Anyone ever experienced any of these symptoms? Anyone ever worked in a fear-based environment? Yeah, yeah, exactly.
So this is the problem and at WorldBlu we’re really committed to solving the root problem, because a lot of times when we’re trying to build great cultures we’re just focusing on the leaves of the tree and not getting at the root issue. The root issue that stops world-class cultures from happening is fear. It’s the number one thing.
So, let’s go back to the freedom at work model. What I’m going to talk about today is under this design piece. When we design our organisations, we don’t set out any more to design our companies in a command and control way, the pyramid structure. Nobody’s walking around being like, hey we’re going to go design a company in a pyramid. Who says that anymore? OK, no one. But what’s happening is, if command and control is one end and democracy’s the other, we’re kind of in the middle.
So we have to be very intentional about designing our organisations around democratic principles. Now why is this? What we have found in our independent research that’s been verified externally is that 75 per cent of what drives culture are your systems and processes. 75 per cent, my friends, of what drives your culture are your systems and processes. It isn’t perks and ping pong. It’s not it. It’s not even who your top leaders are. That has an impact, but if you want to build a world-class culture, it comes down to the systems and processes that you have in place. Are they command and control or are they more democratic?
Now what do I mean by democratic? We spent a decade researching what are the principles of democracy? So when I say democracy, I’m not talking politics – let’s make sure we’re clear about that. I’m talking about organisational democracy. And what we found is that these are the ten principles that have to be in place to have a democratic system. This is literally the definition.
They’re principles like accountability, choice, integrity, decentralisation, transparency. Now you might look at this and go, yeah, that’s great, I agree with all of those things. But what makes it uniquely democratic is you have to have all ten. If you’re just practicing two or three you might have a great place to work and that’s a great starting point, but in this case you have to have all ten in order to have a democratic system. We’ve actually found that while all ten are equally important, four drive the system.
Four drive the system. Those four principles are, unsurprisingly: accountability – the level of accountability you have in your organisation; transparency – the level of transparency you have in your organisation; decentralisation of power – is all your power centralised or is it decentralised out; and choice. Those are what drive the system.
OK, so, is all of this just Kumbaya? That’s great Traci; yay, freedom, democracy. So this is the big question: how does this impact the bottom line? Again we had independent analysis done and they analysed WorldBlu-certified freedom-centred companies, which I’m going to be talking about more in a moment. They looked at their financial performance, specifically revenue growth, compared to the S&P 500 companies and what they found was that companies that practice freedom at work like we teach them have almost seven times the revenue growth compared to the S&P 500. Not double, not triple, but literally seven times the revenue growth on average compared to the S&P 500 companies.
So democracy and freedom in the workplace – which freedom doesn’t mean a free for all; it has to have accountability, it has to have guidelines, it has to have that backbone – is a very, very competitive strategy for growth.
Let me tell you a couple more examples. Anybody heard of WD-40? These are all WorldBlu-certified freedom-centred companies. WD-40 has had phenomenal growth as we’ve been working with them in the freedom at work model. They’ve gone from, what is it, $250 million to over $2 billion in market cap practicing these ideas that we’ve been talking about. Nearsoft, a really great technology company based in Mexico and San Francisco, they’ve grown on average 26% and have had 12x revenue growth working with us.
Boost, they’re down in New Zealand, and they grew 63% in one year, adding over $1m to their bottom line, small company. And DreamHost, this is a really cool one. They actually – a WorldBlu-certified democratic company – took what we taught them in systems and processes, applied it to their new company called Inktank, and went from zero to $175m sale in just two years. That’s the power of understanding systems and processes that are done democratically.
This leads me to my first question I’d like you to consider: what would have to shift in your organisation to have more freedom and less fear in your workplace culture? Let’s take a few minutes and think about that, please.
I want to hear your thoughts. What has to shift in your organisation to have more freedom and less fear? Yes, sir? Deliver at all costs mentality, letting that go. Thank you. One more. Yes ma’am? Revamp the HR. That’s a big one isn’t it? Sorry HR people, but that’s why we’re here, right? Revamp HR – exactly.
Let’s talk about how to get there. OK, now we get to the ten tips part. We’ve talked about design. You’re starting to think about what you can do to shift to more freedom and less fear and I’m going to share ten tips with you based on the ten principles of democracy. These come from WorldBlu-certified freedom-centred cultures. Now what does that mean? One of the things that we do at WorldBlu, by the way, we are a global culture and leadership academy. We teach courses all over the world. The way we do our courses is highly transformational, because we teach through gamified learning.
We’re called WorldBlu because blue is universally recognised as the colour of freedom and our vision is to see one billion people living, leading and working in freedom. That’s our vision. One of the ways we do that is we recognise the most freedom-centred cultures in the world. We actually have two of those in the room today. We’ve got Reddico – just go certified this year, congratulations. And we’ve got Happy – Happy has been certified five times now as a WorldBlu freedom-centred culture.
The way you get certified is actually quite a rigorous process. We don’t do this whole thing where we’re like, send us your propaganda and then we’ll decide if we think you’re cool enough or not. We do it democratically and what we do is we evaluate a company in how well it practices these ten principles at an individual, leadership and systems and process level. So these are literally the best of the best companies all over the world. It’s a very, very high standard to reach. Any of you are welcome to apply, by the way. If you go on our website, you can apply for free for this certification.
I wanted to share with you ten of these best practices based on ten of the democratic principles so that you can start to see how this comes to life. The first democratic principle is accountability. Back to WD-40 for a minute. So how many of you wish you had more accountability in your workplaces? Anybody wish people would do a better job taking accountability? Do you ever feel that way, like, give me a break, if you would just own up this wouldn’t be a problem?
Well it usually is a big problem in most organisations and at WD-40 they have developed an accountability pledge. It’s a short little pledge. If you want it you can download it. This whole thing I’m teaching you right now we just put on our website called Top 10 Tips. You can download the accountability pledge. But they have a short little pledge, it takes about a minute to say, it’s on their wall and it basically says I am accountable and I have no excuse for saying I didn’t know. I have no excuse for saying I didn’t tell people. I am accountable and I am expected to be accountable. And they have this on their wall and if people don’t show up and take accountability, what can they say? Let’s revisit the accountability pledge. Very powerful.
All right, second best practice is choice and let’s talk about Happy. Some of you may know that 75% of people who voluntarily leave their jobs do so because they have a crappy boss or manager. Has anyone ever left a job because they had a crappy boss or manager? It’s a huge, huge problem, so what they figured out how to do at Happy, which I think is just brilliant, is you get to choose your own manager. And we actually have a talk that Henry gave that’s up on YouTube if you search for ‘freedom at work talks’ where Henry talks about how they do this process of choosing your own manager.
All right. Decentralisation. This is about the very definition of democracy; how do you give power to your people in a way that’s constructive? This comes from a company called DaVita. You might be sitting there thinking, oh democracy, that’s great when you have a company of five people. How does that work in a big company? Well DaVita’s got 52,000 employees. The largest company we’ve worked with is 110,000 employees and this works. But DaVita has 52,000 employees and they do many, many things that decentralises power and gives power to the people.
One of the things that they do is they have voting. They invite their employees to vote on what might be considered sillier stuff like what office chair do you want to sit in, but they also have them vote on really big things like strategic direction and benefits and what kinds of plans they want and where to take the organisation next and these kinds of ideas. So they really do have that power to the people mentality and it makes a huge difference. In fact, they have quite a transformation story. Just briefly, they were on the edge of bankruptcy in 1999. Their CEO Kent Thiry came in, totally transitioned it into a democratic model and now they’re at $19 billion.
What have we got next? Dialogue and listening, another democratic principle. This comes from a company called Mindvalley. They’re in the personal growth space, based in Malaysia. These are all WorldBlu certified companies and even though I’m giving you a best practice, what you’ve got to remember is these guys are the whole package. They’re practicing all of it. I’m just giving you one example.
So at Mindvalley one of the ways that they practice dialogue and listening is they have these things called brutal honesty sessions. This happens once a week, their CEO Vishen Lakhiani invites people to take whatever questions they may have and submit them anonymously to him, and then he answers those questions in front of everyone. Sometimes they’re tough questions, but he’s committed to doing that and that has created a tremendous environment of trust and integrity and transparency within the organisation that has served them really well.
Democratic principle – fairness and dignity. This comes from a company called Widen based in Madison, Wisconsin, and they have this concept ‘embrace differences in your community.’ They really believe that everyone should experience what they call the ‘dignity of work’ and so they have now hired five people with developmental challenges to come in and work at Widen. And they’ve created special jobs for them so that they can engage with the Widen workplace.
One of them is what they call popcorn manager. They have one of those old fashioned popcorn machines and this individual, she goes around and she takes everybody’s order in the afternoon, ‘do you want popcorn or not?’ and then she goes and she bags the popcorn and brings it to everyone. These are people who would normally be marginalised in society and so they’re bringing them into the workplace and engaging them and not only is it a benefit for them, but it’s a benefit for everyone within the organisation. So that’s one of the ways that they’re practicing fairness and dignity for everyone.
The individual and the collective. This is such an important principle of democracy. You have to be able to balance both the individual and collective and how those are in relationship to each other. Oftentimes we see in organisations there’s too much emphasis on individual – individual performance, individual contribution – and there isn’t an emphasis on the collective. Or you see too much of an emphasis on the collective without also recognising the contributions of an individual. So those really have to be in balance, not only with recognition but everybody understanding the role they play towards the greater picture.
So what they do at DreamHost – this is just one small thing they do with their customer service reps. These guys are based in LA. They do hosting for websites and what not. What they do is they have a scoreboard that shows every customer service rep on a daily basis how they’re meeting their goals and how they’re advancing through the day. And they’re showing that in relationship to the bigger goals that they’re working towards. They don’t do this to be like, oh you know you fell short of your goal, in a blamey way, but in a way that shows every single person how they’re doing and how they can track them and support them as they go along. And it’s made a huge difference in their overall performance.
OK tip seven – integrity. This comes from Boost down in New Zealand. What they do at Boost is something called retrospectives. This is a way that they really make sure that they bake integrity into the way that they work with their clients. On a bi-weekly basis they sit down, they look at what’s happening with their clients, they do actual training and they go, ‘Do we feel good about what’s happening? Do we feel OK about what’s happening with the client? Are we seeing any issues that are coming up?’ And they literally have allocated a space to have those hard conversations that we often don’t want to have, we kind of glaze over them. So they’ve created a space for doing that by creating these retrospectives.
Tip eight – purpose and vision. This company Nearsoft based in Mexico and San Francisco, they really believe that every single employee should be able to live their purpose and their vision for their life at Nearsoft. So when you come in yes there’s a job description, all that kind of stuff, but they really work with the employees to be clear, ‘What is it that you believe you’re here for? What is it that you stand for in your life?’ which is bigger than just a job description. And they really work to make sure that every single employee is in the right seat on the bus so they’re having the opportunity to live their purpose.
This is something we do at WorldBlu too. If you apply for a job at WorldBlu, the first thing we ask you is what’s your purpose for your life? Because we want to make sure that WorldBlu would be the absolute best professional expression for you to live that purpose and that’s how we make sure we get alignment and get people in the right seat on the bus.
All right, tip number nine, this comes from Menlo Innovations. They have this really cool process called peer-to-peer feedback. What they do at Menlo is if you want feedback, they don’t wait around and do the whole 360, which is super antiquated. What they say is if you want feedback, pull together the peers that you want feedback from and ask them for it. And you can do this over lunch or whatever, because how many of us get feedback from people, like, you don’t really care what they think. We all have had that experience where you’re like, I have to sit there and listen to your feedback and I couldn’t give a flying [blank] about what you think.
So they have figured out a way around this at Menlo, which is get together the people you want feedback from and ask for it. And if you want a salary increase, this is how you get it – you actually have to sit down with your peers and talk it through and they decide if you get that salary increase or not. Very, very democratic.
And the last tip around transparency. This comes from New Belgium Brewery. They’re where I live now, Colorado. They’re an artisan beer company and they practice open book management. Who’s heard of the phrase open book management before? Anyone? OK. Open book management is just like it sounds – opening up your financial information so that everyone in the company understands what it is. And it’s not just flinging numbers at people like, ‘here’s our profit and loss and here’s our revenue numbers.’ It’s making sure you’re educating your employees to be financially literate so that they can make better decisions. That’s the whole goal – so that they can make better decisions.
All right, so those are the quick top ten tips. You can start to see how easy it is to implement democracy and freedom in the workplace in a very intentional way. So that leads me to my last question I would like you to think about, which is this: which best practice could you implement in your organisation in the next month or so. And what will doing so enable you to achieve?
All right, which one might you be able to start to implement in your organisation and what will it enable you to achieve? Go ahead. Three people who think they could maybe implement one of these best practices or die trying?
Yes ma’am. That’s exactly right. We talk at WorldBlu internally and then with our clients, we say we expect you to take extreme ownership. No victim thinking, none of that. We take extreme ownership of our success or our failure, each and every one of us.
All right, in summary, here’s my contact information. My colleague Miranda is based here in the UK. Everything we’ve talked about, the ten principles of democracy, the ten tips, all of this is on our website that you can download for free. Our scorecard, if you have a company and you just want to see where you are, you can take our freedom at work scorecard for free. We’re here for you and there’s great resources for you on our website.
Thanks so much. It’s been a real joy to be with you.