Article
Q&A with founder Simon Dixon: Does an organisation without hierarchy really work?
Hatmill is at the forefront of automation in the supply chain and manages projects with a total CAPEX value of over £1.5bn. Clients include Asda, Greggs and Royal Mail. But not many people know that Hatmill is an organisation without hierarchy. Here, Founder and CEO Simon Dixon talks candidly about Hatmill’s Teal culture and how it works.
People
Describe Hatmill’s Teal culture?
Hatmill has an unusual structure – its Teal culture is all about self-management and autonomy. When I founded Hatmill I had a clear vision – to create a flat organisation structure. At Hatmill, there are no job titles, no hierarchies – it’s very simple.
Coming from a large organisation I experienced first-hand how corporate, egocentric hierarchies can be dysfunctional and counter-productive and was determined not to replicate it. I wanted to prevent it from happening to Hatmill.
In a hierarchy, you are judged by your title so if you are seen as more junior by a client you are deemed less credible. I also found at client meetings the most senior person presented, irrespective of subject knowledge – the most junior person in the room was often the subject matter expert. Why not let them present? An egocentric structure was often counter-productive for the client and for the business. Our clients judge us by what we do and not by our job titles.
A collaborative, entrepreneurial culture is not just better for employees but is also better for clients, which means it’s ultimately better for the organisation as a whole. Despite the recent global challenges our turnover has increased 41%, which shows that we are still a commercially focussed organisation. We have ambitious growth plans and are always looking to hire new talent.
Why did Hatmill become an employee owned business?
Central to its ongoing development and to preserve the autonomous culture I took the step to hand the reigns over to employees and established the business as an Employee-Owned Trust (EOT) on 31st March 2021. This protects Hatmill’s unique culture as it goes from strength to strength. It means that no potential future agency or investor can apply conventional thinking around the culture and gives everyone in the company a tangible share in its success.
How do new employees adjust to Hatmill’s culture?
It’s important that new recruits understand and can adapt to an autonomous way of working. Hatmill has a rigorous recruitment process to ensure the people we recruit share our values. As with everything, it isn’t perfect and we’re realistic. We ask people to think about what working in this environment looks and feels like. You can’t have an ego – respect is earned from colleagues – if you’re interested in the status of job titles it’s probably not for you.
As part of the onboarding process people are assigned a ‘buddy’ to help introduce them to the company and guide them through how things work. We also recommend prospective employees start by reading ‘Re-inventing Organisations’ by Frederic Laloux, it’s in the book that working in our way is called “Teal” following LaLoux’s global research into companies that work in a similar way.
It’s important that everyone sees themselves as one with the company – we all succeed together or fail together – it’s a collaboration. It’s not about what I can get out of you as an employer or what you can get out of me as an employee – this is akin to an adversarial relationship and counter-productive for everyone, especially the clients.
When hierarchy is removed, so is internal competition. In a hierarchy if someone wants a promotion, they may either undermine someone or try and make themselves look better than someone. As soon as that tension is removed, people focus on the project and doing the best for the client, which means we can offer a world class service. Which is what we’re ultimately here to do.
Growth
Is Teal sustainable? How far can the business go operating in this way?
Theoretically, Teal can become more difficult to operate organisationally when a company has grown to between 100-150 as you have less direct contact. But I’m not sure, even when there is an organisation chart there are often informal networks that co-exist that are far more powerful than any imposed organisational design. If you have spirited participation – it will work. An open structure enables us to be nimble. Instead of working towards a number we’re able to constantly assess the landscape as a whole and tweak our approach to respond to what’s happening right now. This means we don’t have that sense of success or failure based on a set of initial rigid assumptions made at the beginning of year – our eyes are always open – we’re not working in a darkened room disconnected from our external environment.
We don’t have a head office we’ve always had a hybrid working pattern, people either work on a client site or from home. Instead, we meet twice a year altogether for 3 days where we share best practice. This means that we don’t have any office overheads. It also allows us to pass on that value to our clients.
Performance:
How do you manage performance with Teal? How is performance data accessed?
Everyone has access to data and information.
For performance management, we have peer to peer management, ratings feed into a matrix that influences our pay rise. Ultimately your colleagues influence your pay rise. For pastoral care – which line managers typically don’t do very well – we chose to use an expert work coach who also talks to employees about homelife and mental health too once a month. For poor performance we generally find informal feedback combined with our twice yearly meet ups is effective.
Trust is a key value – everyone is accountable and works as one for the business. For example, there isn’t an expenses policy, people are trusted to spend what they need to. We only ask that they are happy to explain their expenses to a client. We trust people to make right decision.
Everyone authorises their own holidays, we’re self-managing so don’t need approvals from a line manager. This means that the responsibility for what happens when you’re off remains with you. With the autonomy also comes responsibility.
We’re not being driven by numbers but driven by behaviours and values. If the focus is only on numbers, people can behave in counter-productive ways. Promotion isn’t a good measure for progression, but learning is – it’s objective, not subjective and is distributed by feedback scores from colleagues.
What if there is a disagreement?
Everyone is empowered to express an opinion and we have our “Advice process” to make key internal decisions. This involves the decision maker consulting with both experts and those affected by any decision. People are responsible and accountable for the decisions they make.
Without job titles how does impact a job move to another company?
In terms of moving on to a new company you are ultimately judged by what you have accomplished and achieved and not simply by a couple of words you have been labelled as.
Read about starting your career in a company with no hierarchy here
Ideas & Insights
Sharing Our Expertise
Our guides, ideas and views. Explore our insights to deliver tangible improvements to your supply chain and logistics operations.