A custom-software business in Ann Arbor has a culture that is so admired that 5 percent of its $3.6 million in revenues derive from teaching its practices to others. Menlo Innovations has conducted more than 240 tours last year, exhibiting its culture to executives from companies like Mercedes Benz, Thomson Reuters, and Toyota. NY Mag has a long feature on them.
Here are some of their practices.
- The CEO does not have his own desk, as he sits wherever his staff wants him to sit.
- People always works in pairings, two people sharing one computer.
- The seating chart always changes as people constantly mix and match depending on the project
Respect for employees:
- There are 40-hour workweeks to ensure no burnout. Company offers clients 25 percent discounts in return for the right to flex deadlines. It also keeps a few bench players busy on in-house projects. When client activity gets heavy, they step in to lighten the load.
Hiring and developing:
- They practice something called “extreme interviewing,” in which job applicants are brought in hordes, paired with other applicants and asked to work on representative Menlo assignments while existing staff observes. After the candidates go home, the staff gathers to discuss how well each one collaborated and whether they would be willing to pair with him or her on a real project. Candidates who win over the majority return for a paid one-day trial. That’s followed by a three-week contract before the deal is sealed.
- Menlo’s feedback system further reinforces collaboration. Employees won’t be promoted without first having lunch with a panel of their peers, during which they absorb detailed critiques of their performance. They can request as many lunches as they like and choose their own reviewers. Selecting folks who are most likely to be critical is considered a smart move.
How did this begin?
It starts in the late fall of 1997, when Rich Sheridan, CEO of Menlo, at the time a V.P. at a document-translation firm called Interface Systems, invited his then-8-year-old daughter, Sarah, to join him for a day at work. Around five in the afternoon, Sheridan turned to her and asked what she had learned.
“Well, Daddy,” she replied—and here, Sheridan screws up his face and crunches his body low into his chair and, for a 55-year-old man, does an admirable impression of an 8-year-old girl—“I learned that you’re really important.”
“What makes you say that?” Sheridan asked.
“All day long,” she said, “people came in here and asked you to make a decision for them. And you made a decision, and they went on their way.”
Sheridan was mortified. “I realized that the organization couldn’t move any faster than me,” he said. “That I was the bottleneck.”