Case Scenario: Acworth Systems
Richard Acworth feels his company slipping away. “How could something that was going so great suddenly turn into such a mess?” he mused. Acworth Systems helps companies design, install, and implement complex back-office software systems. Richard and his brother Tom started the company on a shoestring and within two years had 20 employees and nearly $5 million in revenues.
The brothers made a conscious choice to run the company with as few formal rules and procedures as possible. Richard and Tom both remembered what it was like to have to ask permission “every time you wanted to go to the bathroom,” as Tom put it. They had a strong vision of a collaborative organization in which everyone shared the mission and goals of the company and put the good of the whole above individual interests. They spent long hours talking with one another and with trusted advisors to develop a corporate mission statement that outlined their philosophy of an organization built on mutual trust and respect. One thing they were intent on was that people shouldn’t be constrained by rigid boundaries. Thus, Acworth had no formal organization chart, no job titles or descriptions, no close supervision, and very few rules. People were expected to decide for themselves, based on widely shared company information, how best to contribute to the mission and goals.
In the early days, everyone in the office would work on a project, but after the firm started getting more business, work was handled by shifting teams of employees. Although Richard and Tom participated in the hands-on work, each team made its own decisions about what it needed to get the job done—whether that meant buying more equipment, bringing in other team members, or consulting with another company. Everyone knew what everyone else was working on, so people could easily pitch in to help if a team ran into problems. Acworth employees were a close-knit group. Not only did they spend long hours in the office and working together at customer sites, but many employees also socialized together. Every once in a while, the Acworths would throw a party or cookout to reward everyone for a job well done.
But all that was before the growth explosion. Within 18 months, sales grew from $5 million to nearly $20 million and the staff grew from 20 to 100. Consultants who were constantly on the go began working out of their homes and keeping in touch with headquarters via phone and e-mail. Teams rarely called on one another for help any more. Everyone was so busy handling their own projects that they had little interest in anyone else’s problems. The Acworths scheduled a few “all-hands” meetings to try to keep everyone focused on a common goal. The meetings seemed to bring people together for a while, but eventually, communication and collaboration between teams would decline again.
Richard and Tom have discussed the situation several times and both feel they’re out of their league now that the company has grown so large. They miss the camaraderie of the early days and being able to pitch in with the hands-on work. Today, it seems like they spend most of their time trying to find out where the teams are and whether projects are on schedule. Richard finally contacted one of his former professors, who now runs a management consulting firm. Dr. Tyler told Richard and Tom that the firs thing they needed to do was create some structure for the organization. Richard is confused. He thought all that stuff about organizational structure was for grandpa’s company. “Today’s organizations are supposed to be open and flexible, just like Acworth,” he thought. “So why do I feel like the company is starting to come apart at the seams?”
Required to answer:
Question 1: What do you think is the primary problem at Acworth Systems?
Question 2: What elements of a learning organization are evident at Acworth? What elements seem to be missing?
Question 3: Do you agree that the Acworths need to create “some structure” for the organization? Discuss how they might do so.