Open plan office space may inhibit concentration and productivity

William Belk of Rocket Fueled People is reporting something that many of us have known for a while now: Open plan office space is the worst if you need quiet to concentrate and, y’know, actually get things done:

Their work appears to be geared toward tech workers, but the open plan office fad has spread to non-tech companies as well. I work in the very conservative construction and building materials industry and even my company is converting offices to open plan. It’s also taken the accounting firms by storm.

Executives and high-performance employees (HPEs) tend to optimize against completely different trade and life principles—they generally have very different views of the world. This disconnect shows itself very clearly in the environmental conditions of our creative and technical offices. My latest anonymous survey shows that 58% of HPEs need more private spaces for problem solving, and 54% of HPEs find their office environment too distracting.

It’s comforting to know I’m not the only person who finds the hustle and bustle of an open plan office to be distracting and to inhibit concentration. When companies move to open plans, perhaps they should make sure there’s sufficient quiet rooms available for everyone who wants them. At least half of us, it seems.

Check out the link for even more discussion around how innovation depends more on processes and time, not space.

When I looked at the Rocket Fueled People website, I found something else interesting. Part of the work they do is described culture auditing, which is something internal auditors can and should do more of. These types of findings are valuable for management.

Google’s 20% time at accounting firms?

It’s well known that Google encourages their employees to spend roughly equal to one day per week pursuing personal projects, or about 20% of their time at work. The results of this unique policy are numerous and successful: Gmail, Google Suggest, Google News, AdSense and Orkut.

Google logoWhat would happen if an accounting firm allowed their knowledge workers to devote time to personal projects? Would great new ideas surface for snagging new clients, serving existing clients in better ways, or improving processes within the office? I think they would, but it would definitely require some discipline to set aside that much work time away from client work.

I think the benefits from this type of system could be achieved at an accounting firm without needing 20% of available working hours. All that is needed is a method for sharing the ideas with everyone in the organization and a loose structure for obtaining approval to put the idea or plan into action. A wiki on the intranet would be simple to set up and, since they are editable by anyone with access, enable everyone to participate right away.

Google describes “the engineer’s life at Google” with reference to the following pledges:

We listen to every idea, on the theory that any Googler can come up with the next great one.
We provide the resources to turn great ideas into reality.
We offer our engineers “20-percent time” so that they’re free to work on what they’re really passionate about.

I think it would be a bigger challenge to create the type of environment that Google has meticulously cultivated since its inception at an established accounting firm. It’s all too easy to keep doing things the way they’ve always been done, not unlike following last year’s audit plan, in firms. But I believe great things can be accomlished by a firm willing to break out of the mould and take the cue from Google.

Saga of Semco continues

I blogged about Semco SA yesterday, but it was a shallow, dull post merely outlining the ways in which the management philosophy has improved operations for the Brazilian manufacturing and environmental/IT services company. Some more interesting details:

  • Due to management style clashes with his father and founder of the company, current CEO Ricardo Semler threatened to leave the company in 1982. Rather than see this happen, Antonio Semler quit as CEO and vested majority ownership in his son. On his first day as CEO, Ricardo fired 60% of all top management.
  • Adopted a lattice organizational structure, which places 6-10 workers in a team responsible for a task and imbues a sense of ownership and financial responsibility within the team.
  • The Brazilian economy tanked in the early 90s, and workers at SEMCO agreed to wage cuts (their share of profits increased to 39%), management salaries were cut by 40% and employees were given the right to approve every item of expenditure. This allowed the company to ride out the recession and resulted in employees learning more about the business and providing useful suggestions to improve operations.

My summary: Ricardo Semler simultaneously worked to enable his employees to give him useful advice while providing them with the incentive to provide that advice enthusiastically.

The former through the openness of the organization which allows workers to learn how it operates in greater detail than in traditional businesses.

The latter not merely through profit sharing, but also by treating their workers with respect and giving them greater responsibility.

Unorthodox management style is paying off for Semco

Semco is a Brazilian company that has recently taken digg by storm and is making waves amongst more real world folks too. The company is turning pretty much everything we know about how to run a business organization upside down, and getting great results doing just that.

The long and short of it:

  • Employees set their own working hours and choose their salaries and the leader they want to work under
  • All meetings are voluntary and open to everyone
  • Employees hire their own bosses, rate them twice a year and the ratings are published
  • Employees can take early retirement, meaning they get one day a week off in return for working one day a week after they retire

The company’s CEO has set happiness as job #1 for the company – not profits. Employees are treated like adults and are trusted to make responsible decisions. It’s a really cool way to run a company, and it definitely sounds like somewhere I’d like to work.

I think the accounting industry should take a closer look at the way this company operates, especially given how few and far between good CAs are in today’s market.