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    University of Wyoming | Corey Billington | The Secrets of Silicon Valley Management

    July 14, 2015

    By Corey Billington | Visiting Professor of Entrepreneurship & Innovation

    When I asked Dave Packard the question what his secret of success was, he replied “Think about the other guy.”

    I feel that this principle is one of the most important things making Silicon Valley successful. There is experimental evidence that this is true. Anna Lee Saxenian did an excellent dissertation at MIT where she studied Silicon Valley and Route 128 (the area around Boston and MIT) from the end of World War 2 till the year 2000. This was a natural experiment because both areas competed in high tech with the same customers. During this period Silicon Valley flourished and Route 128 did not. Saxenian’s reason is cooperation and collective support. Support others even when you are in different companies. Better to rely on speed than secrecy. In other words, ask for help and give help rather than trying to control everything and everyone. Understand that you need the other guy and it is better to win together than lose alone. Also, there is no shame in needing help and asking for it.

    I formulate the secret of Silicon Valley management in these rules:

    1. Management has a duty to serve staff, not control them
    2. Create an effective work team by highlighting strengths not weaknesses
    3. Reward people for their contributions even if they don’t report to you
    4. Create team identity and include having fun at work
    5. Understand human nature including the use and limits of power
    6. Work group productivity is critical as a way to find resources to innovate
    7. Integrity and ethics are vital to healthy organizations

    Let me give an example of creating an effective work team and how this philosophy works in practice. As a manager our job is to organize the working environment to do more work with less. How? One approach is to focus on the weaknesses of your people and try to correct them. Using this approach any staff weakness is bad. The role of management is to push people and correct the weaknesses of people.

    In contrast, the Silicon Valley approach is to identify the strengths of staff members and only assign work to staff that are good at doing it. A manager needs to make sure that the skills in the team are diverse enough to get all the work done by someone who can do it well. In other words, create a team where the strengths of staff are what counts not their weaknesses. Weaknesses are only weaknesses if there is no one else to cover for you. In addition, if staff only do work they are good at, they normally enjoy their work more.

    “Don’t hire – recruit – and build a strong team around strengths rather than weaknesses.”

    Related to this, when we create a culture for a team we manage we have a choice of the type of culture we create. We can create a culture of control (fear) or a culture of achievement. A culture of fear assumes that people are weak and it is the manager’s job to protect people from their base nature. Micro-management and asking permission are characteristics of this culture.

    A culture of achievement assumes that people are basically good and the manager’s job is inspire people that their work is valued and get people the resources they need to do it. Then get out their way and let them delight you. In my experience, a group that wants to achieve something will outperform a highly controlled team regardless of the boss.

    An example of trust versus control based culture from my past is the question of giving department secretaries company credit cards, have them buy what is permitted for their department without first asking permission. Control is made with a monthly audit. Another approach is to have the secretaries ask their manager’s permission before they buy anything. This control process is slow, expensive and shows a lack of trust in the staff. If we can’t trust our staff with our money, we won’t perform well.

    An example of rewarding people for their contribution is rewarding people that don’t report to you. Many of us at some point in our career are going to be asked to lead a team in which some or all of the people do not report to us. It is important to make sure that your people are rewarded even if they don’t report to you.

    I am currently working with a sustainability manager, Miguel, leading a company task force to create a company process to adopt the United Nations Global Compact. His task force comes from all parts of his large, global company and the part time members have had to do lots of work. Lots of work. The team members don’t report to Miguel so he has no direct way to give them a bonus or a pay raise. We set up a process where Miguel calls each team member’s manager every other week to explain what a good job their people are doing and making sure that their manager understands their contribution. Also he makes sure that they get rewarded with bonuses and pay raises for their efforts on the task force. If Miguel didn’t do this aggressively it would not uncommon for his team to be punished by their bosses. Why? When they work for Miguel, they are not helping their bosses meet their objectives. Most bosses won’t reward members of Miguel’s team without a push. Bosses tend to reward the people that contribute the most to their department, not some other department.

    Please comment below for any further questions!