Professional Documents
Culture Documents
Growth&
Resilience
AN EMPIRICAL ANALYSIS OF HOW FREEDOM AND DEMOCRACY
IN THE WORKPLACE IMPACT BUSINESS PERFORMANCE
Contents
Freedom at Work: Creating the Optimal
Conditions for Success...................................... 3
Freedom Generates Superior Results.............. 8
Case Studies in Freedom-Centered
Growth and Resilience..................................... 11
Our Methods....................................................... 16
About WorldBlu................................................. 18
Freedom at Work:
Creating the Optimal
Conditions for Success
In 1964, in a farsighted Harvard Business Review article entitled,
Democracy Is Inevitable, Warren Bennis and Philip Slater
argued that democracy would be the trend in both the workplace
and in the world because it is the most efficient social system
in times of unrelenting change.1 Bennis, a management expert
and business school professor, and Slater, a sociologist and
writer, foresaw the upheaval technological advances would bring
and the need for a system that was adaptive and that promoted
freedom of thought and action.
They were right.
Philip Slater and Warren Bennis, Democracy Is Inevitable, Harvard Business Review,
42, 1964.
Worldblu | FREEDOM AT WORK: Growth & Resilience | 3
For nearly 20 years WorldBlu has learned from and worked with
leading brandssuch as Zappos, HCL Technologies, DaVita, New
Belgium Brewing, Menlo Innovations and the WD-40 Company
that have made freedom central to their organizations. What have
we learned? Why is freedom at work so invaluable? To understand
that, we must first look at the greatest limiter of freedom in the
workplacefear.
Is fear rampant in your organization? You might not think so. Fear
sounds extreme. But look around and answer these questions
honestly:
What was the last great idea the company pursued that
didnt come from an executive?
Roger Jones, What CEOs are Afraid Of, Harvard Business Review (online),
February 24, 2015.
Worldblu | FREEDOM AT WORK: Growth & Resilience | 4
Freedom
Centered
Organization
We believe the Freedom at Work Model is the new structure for
business in a Democratic Age because it is adaptable to any
organization, in any industry, of any size, anywhere in the world.
Through freedom-centered mindset, leadership, and design,
Freedom at Work impacts culture, operations, products and
services, and managementthe four core elements of every
organization. The effects are therefore far-reaching.
Freedom-centered design leads to democratic organizational structure with less micro-management, greater
sharing of information, and greater decision-making
ability distributed throughout the organization. As a result,
freedom-centered organizations tend to be more agile
and productive, make wiser and more efficient use of their
resources, and innovate and execute with speed.
Organizations that promote freedom-centered leadership create cultures in which everybodynot just the
elite few or those with a certain titlehas the choice and
responsibility to be a leader, beginning with effectively
leading him or herself. They support individuals as they
develop into leaders who have self-worth, self-knowledge,
and can effectively self-govern. And when leadership is
less about control and more about encouraging greater
autonomy and collective wisdom, leaders become more
transparent, honest, and inclusive.
Freedom Generates
Superior Results
Freedom Creates the Conditions for Growth
Revenue growth is one of the greatest measures of a companys
health and sustainability. Consider the companies that have gone
public without ever having turned a profitall because of the
strength of their revenue growth. Amazon has a market capitalization
of about $172 billion, and has never turned a profit. Now, for the
majority of companies, eventually profit mattersa lot. But top-line
growth is proof that the company is doing some essential things
rightsuch as product innovation and customer engagement.
Dale Matheny, an expert in business analytics and sustainable
business practices and a professor at Principia College, helped
WorldBlu analyze the revenue data supplied by participating
WorldBlu-certified companies from around the world. These
companies represent a wide range of industries (see sidebar).
Some have a few employees; others have thousands. Some are
private, some are public, and some are employee-owned.
To judge the strength of the WorldBlu company results, we
compared their revenue growth to that of S&P 500 companies.
We looked at cumulative revenue growth over a three-year
period, 2010 to 2013 (similar to Inc.s approach when compiling
their lists of fastest growing companies). We felt cumulative
growth was more telling because companies were still emerging
from the Great Recession. The S&P 500 companies achieved a
15.36 percent average cumulative growth rate. The WorldBlu
companies in our study achieved a staggering growth rate of
103.16 percent.
WorldBlu
Companies
103.16%
Youngest Company:
Founded in 2010
Oldest Company:
Founded in 1953
S&P 500
Companies
15.36%
Industries Represented
Biotechnology
Education
Financial Services
Food and Beverage
Healthcare
Household products
Professional services / consulting
Software and application
design and development
Technology
Warehousing and distribution
25
50
75
100
125
La Siembra
Co-operative
Linden Lab
Menlo Innovations
MindValley
Motek
Nearsoft
New Belgium
Brewing Company
NixonMcInnes
Orpheus Chamber
Orchestra
Pandora
Rite-Solutions
Roche Salon
The Russell Family
Foundation
Rypple
SBTV.com
Sedgebrook
Seventh Generation
South Mountain
Company
SRC Holdings
Srijan Technologies
Statsit/Getting
Personal
Sweetriot
TakingITGlobal
Ternary Software
Threadless
Touchstone
Consulting
Group/SRA
Tracer
Union Cab
of Madison
Cooperative
Veldhoen +
Company
Wongdoody
Zaadz
Zimbio
Zingermans
National
Average
10.33%
WorldBlu
Companies
4.6%
12
Case Studies in
Freedom-Driven Growth
and Resilience
At WorldBlu, we have seen time and again that freedom is
not something to be enforced with a one-size-fits-all practice
or set of rules. What works at a fair-trade co-op in the US is
not necessarily going to work at a software development firm
in Malaysia. Yet a foundational framework and a model for
organizational development can help us find a clear path forward.
We have proven that putting the WorldBlu 10 Principles of
Organizational Democracy and the Freedom at Work Model
into practice in ways that make sense for a particular organization
leads to greater success, by many measures. Two companies
that stand as testament are Menlo Innovations and DaVita.
Our Methods
Assessing Freedom
Every year since 2007, we have used an employee survey
process called the Freedom at Work Survey to determine
the strength and depth of democratic principles in participating
organizations. The result is the WorldBlu List of FreedomCentered Workplaces (formerly the WorldBlu List of Most
Democratic Workplaces). But what are we assessing exactly?
More than 250,000 employees worldwide have taken the survey
to assess their organization on a fear-based to freedom-centered
continuum. The Freedom at Work Survey asks employees to
consider where, when, and how ten foundational democratic
principlesthe WorldBlu 10 Principles of Organizational
Democracyshow up in their companys employees behavior,
leadership, and overall systems and processes. In most
companies, 70 percent of employees must complete the survey for
the company to be considered for the list. In very large companies,
we survey a random sample of a specific number of employees
across the organization, and they must all complete the survey for
the company to be considered. Organizations that score a 3.5 (out
of 5) or higher earn the WorldBlu certification designation.
Assessing Growth
The revenue growth of WorldBlu companies is based on
reported data from 19 companies that self-selected from the 120
companies that qualified for the study. Due to the availability of
data, revenue growth for most of the nineteen companies was
measured as
DreamHost, Los Angeles, CA
We tested our 103.16% revenue growth rate and found that it was
statistically higher than the S&P 500 three-year cumulative growth
rate, as reported by Standard & Poors:
1. Sample size (N) = 19; sample mean = 103.16%; sample
standard deviation (s) = 83.72
2. Our hypothesis was: Ho: 0 <=15.36 with alternate H1:
0>15.36
Assessing Resilience
As described in the text, we reviewed the survival of 65 WorldBlu
companies that were certified in 2007, 2008, and 2009. We used
the following information as a basis for our calculations:
One had been sold prior to the recession and was further
integrated into the purchasing company during the established time frame, but did not cease operations.
About WorldBlu
WorldBlus purpose is to develop world-class freedom-centered
(rather than fear-based) organizations and leaders. Our vision is
to see one billion people leading and working in freedom.
Since 1997, we have been studying and assessing the most
freedom-centered leaders and freedom-centered workplaces
around the world. After a decade of research on organizational
development and democratic management, we created the
WorldBlu Freedom at Work Assessment. We published the
first WorldBlu List of Most Freedom-Centered Workplaces in
2007. As of 2015, we have highlighted more than 135 companies
around the globe that range in size from 5 to 61,000 employees
and represent every industry.
Today, we work toward our purpose and vision by offering
consulting and coaching services, boot camps, assessments,
and certificationssuch as our Freedom-Centered Leader
programto help individuals and organizations live in and spread
freedom around the world.