Thanks to the Industrial Age we (still) live in a world where most companies hire employees. They look for people with the right education, who have been trained with the right skills to do their job. They create a human factory of sorts.
The ‘employee’ world is changing, albeit slowly. Smart owners are seeing increased productivity and profits by turning their employees into stakeholders. Stakeholders take initiative, they take ownership, they solve problems. Stakeholders don’t wait around passively for something to happen; they make it happen. Stakeholders do great things.
In a powerful blog post that addresses why employees are a bad idea, best-selling author Chuck Blakeman tells us why employees are ultimately bad for companies. Hiring people to come in and do only what they’re told (i.e. most employees) leads to low morale and diminished production. It’s not good for the individuals or the company.
Chuck talks about people who have created ‘participation companies’ that treat all their people as stakeholders. In his TED Talk, Chuck goes into detail about the benefits of hiring stakeholders—they share in the profits and the profits are much bigger. It’s a positive partnership.
Why is this important? When owners decide to bring in stakeholders they change the trajectory of their company. They create a culture where people do things because they want to, not because they have to to keep their job. They create advantages for themselves and their people:
Benefits to individuals
- Satisfaction in their work: when they have a say in what they do and how they do it, individuals put their best effort forward. They do their best work.
- Titles no longer matter: individuals work together with their team to get the work done. They don’t worry about who gets the credit.
- Work is fun: when you’re in a good environment working with people who all have the same objectives, work is enjoyable. You realize the fruits of your work.
Benefits for managers/owners
- Increased productivity: if they have a stake in the outcome, people will work hard and accomplish big results.
- Improved teamwork: people work together to get things done. They support each other and accomplish much more together than they would working alone.
- More money: revenues rise when people have a stake in the outcome.
- Work gets done: you don’t have to tell people what to do. You give them direction and they get things done.
If you’re an individual working as an ‘employee’ you need to look for ways to work as if you are a stakeholder, or look for opportunities where you can truly be a stakeholder. If you run a team or a company, start treating your people as stakeholders. Make it a place where they want to come to work every day. Remove the shackles that are keeping you from having a great company.
Questions: Do you feel trapped as an employee? What would you do if you could break free and become a stakeholder? Please leave a comment in the space below.
The Product Management Perspective: This is an interesting topic for product managers because they don’t often have people reporting to them. However, you have the opportunity to be the stakeholder in how you do your work. You can inspire the execs and managers to treat their people as stakeholders. As you work with people on different teams, and treat them as stakeholders, they will do great work for your products.