Developing an Ownership Culture
Clarifying ownership creates agency. Agency tends to increase effort and initiative. When you take agency away, people shrink.
What separates businesses that seem to grow endlessly on their own and those that stall out after some early success? The secret is Ownership Culture, and this post will help you get started with implementing it in your own company.
In companies with a strong ownership culture, everything is built around people owning an area of responsibility, so they have agency and control over it. This will enable two positive effects.
You’re going to get much better work out of people because they will own the outcome, and they can take responsibility for it.
It will allow people to work directly with each other and allow the leadership to work on the people instead of the tasks. (The people will own the tasks while the leadership manages the people.)
Agency is the most important concept in effective management. Giving people the ability to influence the outcomes within their domain is incredibly powerful. If they have a sense of influence over their domain of responsibility, then they will engage and take responsibility.
What Problems Does this Solve?
Losing Great People: A+ players want control over their destiny. Give them a sense of ownership, or they will find someone else who will.
Pushing Uphill: It feels like dragging the team uphill to get anything done. Without agency, projects languish, and problems outnumber solutions.
Avoiding Responsibility: Without agency, people become disconnected and passive, and problems are always someone else’s fault. Even worse, people may be afraid to name problems because they may be tasked with fixing a problem for which they aren’t empowered to solve effectively.
Losing Control: Increasing complexity means too many loose ends. Problems are getting out of hand. If you don’t know exactly who owns it, nobody does.
The Three Shifts:
Developing an ownership culture in your organization requires three fundamental shifts. Each shift starts with the top leader. She has to own it before anyone else can. Next, the top leadership team has to make these shifts. Once that group is fully engaged with the ownership culture. These shifts will start to become part of the DNA of the company.
Mindset Shift: Understand that every problem starts with the leaders and how they organize the team.
Behavior Shift: Learn to delegate clearly so that the owner has the authority and resources to do the work.
Systems Shift: Establish a formal system to give ownership of every key task to a single individual.
Owning Your Ownership
Often, the starting point for the ownership culture discussion is a founder asking in frustration: “Why isn’t my team doing what they are supposed to do?” That’s a very passive mentality, but that is how most people think about problems. We see all of these things that aren’t going the way that we would like, and we fall into a classic psychological trap. We think that everything that doesn’t go our way originates from outside of us, and everything that does go our way comes from inside of us (because we’re amazing, right?).
We need to face the hard truth that retired U.S. Army General Stanley McChrystal regularly teaches to business executives: “The problem is not the problem. We’re the problem” (Luscombe, 2021, Time).
As the leader, especially as a founder, we have to recognize that we have created our teams and systems. As leaders, we are responsible for how our teams function. Ultimately, our team is an expression of us, our style of leadership, and our competence and character as leaders. If my team has a problem, that means I have a problem. I am always part of the problem. Owning this is the beginning of developing an ownership culture.
Internalizing and Operationalizing Agency
On an individual level, the way out of the externalization trap is to have a very empowered mindset. You have to believe that you have a lot of influence over your region of responsibility. You have direct agency in your zone of influence.
A culture of ownership triggers people to develop more self-awareness. Most of us naturally default to unhealthy patterns of externalizing problems. Giving ownership short-circuits this defense mechanism. When people recognize that they are (at least partly) responsible for this thing that happened, then they start to evaluate why they do the things they do because they have agency. Good or bad, I contributed to this outcome.
That’s why High-Performance Meetings always include space for us to clarify how we contributed to the problems we face. This reminds us that we are active agents, not just passively taking in bad things that happen to us. That ownership of responsibility instigates self-awareness because people realize that adjusting how they engage in the situation can change the outcome.
On an organizational level, we operationalize agency by delegating ownership through assigning Areas Of Responsibility (AORs) to Directly Responsible Individuals (DRIs). The DRI is a critical concept that started with Apple but has since spread to many other companies. In short, it is important to establish very clearly who (DRI) is responsible for what (AOR).
Eventually, your Area of Responsibility registry will cover nearly everything in the company. However, this doesn’t have to be a massive project with lots of upfront work. Just get your registry set up with the basics, and start adding stuff as questions come up so you don’t have to repeatedly decide who owns what.
Check back next week to explore how to avoid the most common pitfalls around ownership culture: sloppy delegation, assigning tasks, keeping ownership at the executive level, focusing only on outcomes, and neglecting systems.
But for now, let’s just call out one of the most important steps in facilitating agency: clean delegation. Good delegation is clear on the why (the mission), what (the AOR), who (the DRl), and when (the deadline). You must also agree on how success will be assessed, including specific targets on specific metrics. However, how the work is to be done is usually up to the DRI. That’s where they have critical agency.
Summary
Are you the bottleneck for your company? Do all the decisions flow through you? Are your people always waiting for you to get back from a trip or to work through your inbox? Do you feel like you just don’t have enough time in the day for all the work that is piling up for you?
The bad news is you are the problem here. The good news is you are the problem here, and you can shift your own mindset and behavior. You need to start giving ownership away. We don’t mean equity. We mean, you need to give away your tasks to others. In fact, you need to create a whole culture of ownership and systems of accountability to share that ownership effectively. This is a key step in scaling yourself and scaling your company.
Start Now:
Reflection Question: When have you felt frustrated because you didn’t really have the agency to do what needed to be done? How might your people be feeling that right now?
Immediate Action Step: Make a quick list of the teams and tasks that you own. Identify one area to start giving away.