Early Draft of Rummler’s "Employee Bill of Rights"

Note- this post is from prior to Geary’s passing in 2008.

This early draft of Rummler’s Employee Bill of Rights was co-authored by father and son, Geary and Matt Rummler and was published in CADDI’s newsletter, named at the time “Lean-ISD” (later changed back to the name I had evolved SWI’s newsletter to: Pursuing Performance). From the SPRING 2001 issue

A year ago, an acquaintance of ours left the security
of a major accounting firm to join an exciting
“start-up” company, founded by several former
employees of that same accounting firm. The
founders had a valid enough service idea, it having
been successfully executed by their former employer.

Further validation of the idea came in the
form of a pledge of more than $60 million of
funding by a venture capitalist.

Our friend was in the second wave of hiring, and the company had
been in business for about ten months. One of
the appealing aspects of working with this new
firm was the work environment, which was purposely
in contrast to that of the former employer accounting
firm.

One of the features of the new
organization was the proudly stated Company
Values
(see Figure 1), which were posted everywhere
in the offices and pitched heavily as part of
the recruiting effort.

During the past year, the
company opened offices in three major cities and
expanded the payroll to more than 400 employees
by luring many new employees from established
firms and secure jobs with 20 percent salary increases
and stock options.

Several weeks ago, the company announced

  • A layoff of 20 percent of its workforce
  • That the venture capitalist, who had already
    committed 60 percent of the promised funding,
    was not going to invest any more based on the
    performance of the firm to date
  • They were looking for a buyer for the firm

Following that announcement, more layoffs have
taken place, no buyers have come forth, and the
founders are “bailing”—taking care of themselves
first. The company is clearly in its final death
throes. And during these past several months, the
founders and senior management of this firm
have violated every espoused company “value”
other than “simplicity.”

What Happened?
This new company did some wonderful “new-age”
things, including the value statement, generous
benefits, oval meeting rooms with cushions
rather than chairs, business cards in three colors
for everyone, frequent company social gatherings
and an informal work atmosphere (e.g., everyone
is called by their first name), no organization
chart, and no titles.

But from the point of view of a couple of
performance analysts, there were several “old-age”
things that the new company did not do; for
example, they did not have

▪ A business plan and subsequent performance goals

▪ A strategy for achieving the goals that were never set

▪ Clear definition of management roles, responsibilities, and accountabilities (The founders “didn’t believe in organization charts,” and there were none until the investors asked to see one as part of evaluating the request for additional funds. The subsequent distribution of this document in the company lead to a major hullabaloo as the employee’s typical response was “. . . but I thought he/she worked for me, not the other way around.”)

▪ A management system including the fundamentals of goal setting, performance monitoring, and corrective action, if required

Unfortunately, the predicament of our friend is
not unique.

As noted in the February 6, 2001,
Business 2.0 article titled “Return of the Crummy
Job,” this is becoming an all-too-familiar scenario.

There are a lot of factors that contribute to a
start-up business failing, but to us an all-too frequent
component is incompetent management.

▪ People who are clueless as to what basic systems (“systems” as in operating and management systems, not in the information technology sense of the word) are required for a business to be successful.

▪ Founders and executives that substitute mission statements for sound strategy and value statements for sound operating systems. (“Rather than go to the aggravation of establishing and communicating an organization chart that would help clarify roles and accountabilities, let’s just make “accountability” a company value. That should do the job!” Note to venture capitalists: mission statements and value statements are fine, but they are not a substitute for sound underlying business models, business plans, strategies, and operating systems.)

An Employee Bill of Rights?
As we have followed the travails of our friend and
her employer over the past year, one of the most
annoying things (in addition to the criminal incompetence
of the founders and executives) has
been the oft-ballyhooed company values.

They have been used to seduce/recruit new employees
and to rally the troops during operating crises.

And in the final analysis, when push came to
shove, they were systematically violated or ignored
by senior management in their rush to the
“lifeboats.” Assuming for the moment that value
statements have value (we won’t go there in this
paper), what can/could be done to them to add
value?

Minimally, it seems “competence” (executive,
in particular) should be added as a value. But our
suggestion is to replace the company value statement
with an employee bill of rights.

An example of such a bill of rights appears
in Figure 2. Important features of such a
document include

▪ Explicitly addressing the reality that the “bottom line” is the bottom line (Part A). There should be no attempt to kid employees or delude management that this is not the case.

▪ Recognizing the importance of competent management and sound operating and management systems and making the commitment to provide both. (Part B)

▪ Making it clear that both parties (the employee and the employing institution) have rights and expectations of the other.

Will our bill of rights make a difference in this sea
of management incompetence, as fools rush in, in
search of investment dollars and quick returns?

Doubtful. But to the degree that mere words and
“value statements” can make a difference, getting
the right words on paper could be a start.

© 2001
Geary A. Rummler
Matthew E. Rummler
Source: PerformanceDesignLab.com
Geary and Matthew Rummler are partners in the Performance Design Lab, located in Tucson, Arizona

Mission
statements and
value statements
are fine, but they
are not a
substitute for
sound underlying
business models,
business plans,
strategies, and
operating
systems.

Dr. Geary A. Rummler is the founder of the Performance Design Lab and the author of

Improving Performance: How to Manage the White Space on the Organization Chart By Geary A. Rummler, Alan P. Brache

and

Serious Performance Consulting According to Rummler By Geary A. Rummler

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