How 2,300 Employees Moved To Self-Management - Overnight!
We heard of an amazing transformation: a traditional organization, with thousands of employees, moved to self-management overnight! We had never come across such a story before. We set out to learn more.
It turned out to be the story of Familiehulp, and it was told to us by its founder, Jaap Peters. But it begins with what was once Holland’s largest traditional home care organization, TSN.
TSN was founded in 2001 and grew via mergers and acquisitions to become Holland’s largest home-care organization. Just prior to bankruptcy, they employed 12,000 nurses who cared for 40,000 clients in 300+ municipalities.
Sadly, TSN developed severe financial problems, eventually leading to its bankruptcy in March 2016. 12,000 employees lost their jobs instantly. This is when Jaap Peters enters the story.
He set out to save some of the employees from losing their jobs. He began by calling Buurtzorg's Jos de Blok, for advice—and to suggest they team up together. Jos agreed. They started a new organization called Familiehulp (Dutch for family support).
As Jaap describes it: “So, I call Jos de Blok who just happens to be in America on that day. I explain to him my vision about the future of all those people and he just answers me: "Sounds like a good plan, but I’m in America now, so good luck!” That’s the moment I realized how self-management really works!”
After lots of bureaucratic hassle and lawsuits, they manage to provide jobs for 2,300 of the 12,000 former TSN-nurses. Jaap and Jos launch the transition from a traditional to self-managed organization in their own unique way.
Start with a vision
To start, Jaap and Jos briefed the employees about their vision, the philosophy behind it, the IT-system (Ecare) supporting it and the transformation needed to get there. These briefings were in groups of 300. They had very limited time in which to make it all happen.
The big concern is for the clients—it is important that they keep receiving the best treatment possible. One big shift is that care will now be focused, not on time (as before), but clearly on results. They become a results-driven organization.
Jaap: “In the end, for the employees, not much changes in the real purpose of their work. Many chose to do this work because of their personal passion for caring for others. It’s not the nature of the work that changes, it is just the organization around them.”
They simply tell the employees to start changing to Buurtzorg’s self-management style over a weekend. On the Friday before, the employees still work in a hierarchy. On the Monday after, they work in newly-formed, self-managing teams.
Yes, you read this correctly! The transformation for 2,300 employees is done over a weekend. This approach seems to be in conflict with some change management theories. Many suggest starting with some pilot teams first.
But just like many other workplace pioneers on our Bucket List, Jaap and Jos are averse to doing things in traditional ways. They do it differently and enjoy proving the theories wrong. Especially as their ‘flash’ change seems to work pretty well!
Build a network of teams
As the second step, Jaap and Jos replace the pyramid with a network of teams. They create a network of self-managing teams (each of about 8 to 12 employees based on zip code). The employees suddenly need to take care of everything as a team: work schedules, holiday and sick-leave replacements, hiring and on-boarding of new members, and logging of working hours. As a group, they are now responsible for team performance.
For some, this is a challenging period. They feel as if they have been thrown in at the deep end. Many things confront them at the same time. This is difficult for those not used to teamwork.
Jaap: “It needed time to settle down. Especially with all the different characters, mentalities and views on the work that needed to be done. The employees realized that now it’s not only about being there for your clients, but just as much as being there for your colleagues. Suddenly all kinds of things need to be discussed openly in a safe space, including the mistakes and failures.”
No direction from the top
After their 10+ years of experience at Buurtzorg, Jos and Jaap know that the problem-solving capacity at the bottom of the organization can be powerful enough to lead this transition. They rely on this, rather than directing transformation from the top, or even via special project teams.
But they also realize that the teams should have access to support when it is needed. So, for the transformation period, they appoint special coordinators (most of them from Buurtzorg). The coordinators function as coaches to facilitate the transition. It’s their duty to make themselves available as needed.
Jaap: “At the start it was difficult for the coordinators. They received hundreds of phone-calls and they felt some of the employees were highly frustrated and uncomfortable with the transformation. This is not a strange thing. For many employees it was yet another transformation they have to endure, after all the previous mergers and acquisitions of TSN.”
The coordinators reduce the frustrations by providing clarity about the new philosophy and the new ways of working at Buurtzorg and Familiehulp. Despite these efforts, a few employees still leave the organization before/during the transformation—but only ~20 out of 2,300.
That people choose to leave during a transformation is not unusual. It is common for 10 to 20% to leave over the couple of years it often takes. The ratio of ~1% at Familiehulp is in fact very low.
Some simply don’t like self-management. Some don’t enjoy organizing things in groups. Some prefer to find a place back in a more traditional company. It’s usually better for both parties when they do.
A promising start
Although some have left, the majority of employees are happy with the rebirth of their organization.
Jaap: “After a rough start they now perform much better in the new structure compared to the old organization. Employees are now happy to be part of a real team where people support each other.”
Financially they are also flourishing. Overhead costs have dropped by 8%, and the organization is profitable again. Jaap: “The organization is profitable mainly due to the absence of management layers. But there are more indicators that it is going in the right direction. Sick leave has dropped from 13% to only 1.5%. It’s now even lower than Buurtzorg. The employees seem to really start enjoying their work again.”
The organization is profitable mainly due to the absence of management layers.
Jaap and Jos seem to have shown that this radical, ‘alternative’ approach to transformation can work just fine. We acknowledge it is all relatively fresh. Nevertheless, it’s a very promising start—and their future looks bright!
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Familiehulp is setup as a Dutch non-profit foundation - https://en.wikipedia.org/wiki/Foundation_(nonprofit). They are not cooperatively owned, although some of the employees desire to move into that direction.
There is, however, another interesting Dutch health care organization which is cooperatively owned. It's called HelpGewoon - http://www.helpgewoon.nl/
How the employees were selected is quite a complicated story. In short and simplified: This kind of care is paid by the local municipalities, so they held the final say in allowing the 're-launch' of Familiehulp in their own municipality. Only 18 of the 'original' 307 municipalities decided to go for it. Of these 18 municipalities Familiehulp only selected the front-line employees, no managers.
And what happened to the other 10.000? They lost their job, and ended up the Dutch welfare system trying to find work elsewhere.
In early 2018 I took on a new challenge. After two years in the popular management world I decided to take a leap into academic life. I started a part-time PhD program in Business at the VU University Amsterdam. Since then I have researched how large organizations (with thousands of employees) can scale and organize without the need for middle management. It’s time to share what we’ve learned.