Life, distilled by Will Critchlow

If you’ve followed the stuff I’ve written here and elsewhere, you’ll know I’m a sucker for academic exercises, game theory and business strategy. Combine the three and you know I’ll be hooked.

It’ll come then as no surprise that I’ve been fascinated recently to read about Valve’s amazing corporate structure (TL;DR no management at all and an incredibly empowered workforce). If you haven’t been following along:

• Start with the employee handbook
• Read their economist’s view of the pseudo-marketplace within Valve

I desperately want to learn from their experiment, but there are some things I’m really struggling to get my head around. I hope someone from Valve can stop by and help out. I’ll start with just three questions. I think all of these three actually relate to the same underlying confusion of mine - of what fills some of the vacuum that must be left without any management at all:

1 - How do you balance personal desires with what’s best for the company?

I understand how you mainly avoid people slacking off (explained in the economics post). I don’t quite understand how individuals balance personal desires against company performance. It feels like it could easily descend into a tragedy of the commons where everyone was working (very hard) on long-term fun long shots and no-one was maintaining the cash cows.

Do some people suck this up and take one for the team to work on less fun but highly important projects out of a sense of duty? Do they resent others swanning around having fun on crazy projects?

2 - How do you decide when and whom to hire?

First the when - in most companies this would be a core function of management - estimating capacity and demand and choosing what roles needed filling.

I can just about imagine this self-organising with individual teams hiring people when they need them - but given that they can just wheel their desks off somewhere else and join another team, it’s not clear that they would actually be making a good decision for the company (indeed, if you can’t recruit internally, it should indicate that you have an unpopular project, no?).

Whom - as you’ve said, the whole thing relies on having only very self-motivated and disciplined people working for you. With (presumably) no company-wide hiring process and no way of enforcing specific gatekeepers on hiring, how are you better than your average company at what is one of the key determinants of your success?

3 - How do you get unglamorous work done?

Related to the hiring question - it’s not clear to me what it means to (for example) hire a bookkeeper. You can hire a person and start them off doing bookkeeping - but from their first day, they can wheel off their desk and start “adding more value” somewhere else. How do you hire for unglamorous roles (and retain people in those roles)?

Some questions that are probably more sensitive but that I also don’t understand:

• I just about get the process for allocating a salary budget across the whole company via a democratic process - but not how that budget is decided? I asked about this on Quora but didn’t get a good answer
• How does anyone ever get fired / laid off? (Does anyone ever get fired / laid off?). It can’t possibly be democratic can it? A popularity contest?