Could Gamification Replace Management?

What’s your immediate response to the idea of replacing all management in your company with leader boards and badges? Does it scare you? Does it make you angry? Does it seem so ludicrously Machiavellian that you laugh in disgust? Good, me too.  The more I think about this the more I like it the more I LOVE IT! It sends chills up my back and makes me want to run away screaming. It’s that good.

I can already hear the arguments: “People will game the system.” Like they don’t already. “Employees need managers.” No, managers need employees to manage more than employees need to be managed. “The workplace would break down in total anarchy without someone there to tell people what to do.” Now you’re starting to sound like a 3rd world dictatorship.

I’m guessing that your objections are based on two beliefs: Employees need management and that gamification is shallow, exploitable and people don’t want scores and badges. I will first state that gamification, as it stands today, is not what I’m talking about, but it is the precursor to what is still to come. Additionally I’m separating out “management” from other roles often fulfilled by managers like mentoring.

Let me first introduce exhibit A: The HBR article on Morning Star, the market leading tomato products company.

How essential is it to have layers of executives supervising workers? Managers are expensive, increase the risk of bad judgment, slow decision making, and often disenfranchise employees. Yet most business activities require greater coordination than markets can provide.

Is there a way to combine the freedom and flexibility of markets with the control of a management hierarchy? Economists will tell you it’s impossible, but the Morning Star Company proves otherwise. It has been managing without managers for more than two decades.

At Morning Star, whose revenues were over $700 million in 2010, no one has a boss, employees negotiate responsibilities with their peers, everyone can spend the company’s money, and each individual is responsible for procuring the tools needed to do his or her work.

By making the mission the boss and truly empowering people, the company creates an environment where people can manage themselves.

“Yeah, but…” I know; “this would never work at your company.” And you’re probably right. Morning Star was built this way from the ground up. They work with a series of negotiated commitments between each employee and everyone they have to do business with. And it works better than anything out there. I won’t recount the whole article to you but go read it and become a believer (or not).

Exhibit B: Gamification is here to stay and it works. As online gaming like WoW and other MMORPG‘s have shown, gaming works. Gamification is a hugely successful method for driving collaboration, and team work; two things desperately missing from today’s enterprise size corporations. Furthermore if you still don’t agree with me watch this much linked to video by Jane McGonigal: Gaming to make a better World.

Exhibit C: Silicon Angle has a post about new gamification features in Socialcast and also give a quick rundown of several other products on the market.

Traditional performance reviews can help keep the business and its processes on track by reviewing individual performance. But they are also limiting. They often don’t reflect how an employee is doing on a day-to-day basis. The reviews judge people by the goals that have been set. The result is often a poor reflection of the individual. The employee can go for months without getting any feedback on they are doing in their work.  It can lead to frustration and a feeling that their work does not matter.

A number of startups are reaching into the performance review space to provide more comprehensive and immediate feedback. Most notably are companies such as Rypple,Achievers, Small-Improvements, Engage and Sonar 6. More established services includeSuccess Factors and Halogen.

At the beginning of this year, I identified as one of my 5 year predictions, enterprise gamification:

Why not build game mechanics into CRM applications? The biggest flaw in every CRM is getting people to enter data. There’s no good way to do this why not make a game out of it. Sounds trite but I guarantee you’ll see better results than you see now.

With the advent of social and mobile data there will not only be more an opportunity for gaming but also more of a need. Not everything is intrinsically motivating and sometimes a little rewards works well.

At the time I was thinking of this as a way to augment tasks with less intrinsic motivation like getting sales people to enter customer data into a CRM system, but now I’m thinking it could be much, much bigger.

I know that some of you – in fact – most of you,  probably aren’t convinced yet. If you are a manager or work in HR, you’re probably so incensed that you couldn’t be bothered to read this far and either have already left or jumped straight to the comments to tell me what an idiot I am (I hope I get some of these comments). If so I give you my final exhibit.

Exhibit D: “The more visceral the reaction, the more important the idea is.” Okay, I’m cheating with this one because I’m quoting myself, but I know it’s true. If something in business (that doesn’t have anything to do with morals or ethics) gives you a visceral response then it usually means there’s a big market opportunity there. If the idea of using gamification to replace management give you this kind of visceral reaction then I’d stop and take a closer look at what the market opportunity is. And in this case I’ll go ahead and tell you what it is: The ability to replace the cumbersome, costly and often ineffective management processes with simplified, data driven reward metrics that could actually drive even greater individual, team and business results than the current process is capable of.  It’s that big.

And to throw out an olive branch to anyone who hates me now, I also believe that either as a starting point or as a compromise you could combine gamification with management but I don’t think you’ll get the full benefit this way.

About Tac Anderson

Social media anthropologist. Communications strategist. Business model junkie. Chief blogger here at New Comm Biz.
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  • Bryan V

    All right there pardner, now you are crossing over into my
    realm.  In general I agree with your
    thoughts about the potential benefits of gamification and the impact it can
    have on the profitability of an organization. 
    In many ways the courage to introduce a concept like gamification to the
    workplace hinges on the organizations tolerance for leaders vs. managers.  Here are a couple of truths I have seen.

    1)      -Flatter is better.  We must push decision making authority down
    to the people who influence the outcomes. 
    The most effective I have ever been as a leader is when I am allowed the
    leeway to set the vision and get the hell out of the way.  My team is talented, knows the business and
    the relative strengths and weaknesses of their teams.  This simple act of staying out of the way
    empowers them to be their best and not just deliver on a plan that was
    presented to them.  I believe some of the
    strategies involved in gamification can support that.

    2)      
    IndivIndividuals want to be recognized.  This seems like such a simple thing, and in
    many ways it is, but traditional organizations have a difficult time truly
    implementing a culture of recognition. 
    It is simple to recognize people with praise or even a non-monetary
    award that has some intrinsic value to the individual.  A concept that is often used in gaming (rank,
    levels etc.) however a traditional management structure built on annual reviews
    tied to monetary compensation is not flexible enough to accommodate this.

    3)      
    TherThere are real world consequences to poor
    decisions.  By encouraging recognition I’m
    not advocating a world without consequences or one where everyone gets a trophy
    (I believe that the current “everyone wins” nature of American society is
    damaging not helping our youth).  Even in
    (or especially in) a game environment there are winners and losers.  A poorly designed strategy or a failure to
    execute a good strategy in WOW will have you asking how you ended up with an
    axe in the back of your head.  In
    business it can mean real losses of time, resources, money and even jobs.  So consequences are real and cannot be
    ignored, but should not cripple action.

    Here’s my last thought. 
    As we witness a generational shift in the workforce I believe some level
    of a transition to a gamification environment is inevitable.  While old farts like you and I were the first
    generation to be raised on the instant gratification of gaming, the level of
    saturation of the technology was nowhere near the level of the generations that
    follow.  The generation entering the
    workforce has never known a time when personal gaming, on-line gaming, and
    immersive technology didn’t exist.  As
    leaders we need to embrace this change in the workforce and be brave enough to realize
    that we may are not experts in it.  We
    have to be brave enough to demonstrate leadership and allow our teams to find
    their desired form of recognition and teamwork, if not we will chase talent
    from our organizations to those who do.

  • http://twitter.com/KellyJoHorton Kelly Jo Horton

    “The more visceral the reaction, the more important the idea is.”Bingo.

  • http://twitter.com/bruce_2b Bruce Wilson

    Thanks Tac, you can’t buy thought provocation this good! OK, my quick take (since you asked):

    In certain kinds of organizations—perhaps very P&L oriented ones where many folks have clear personal productivity metrics, like Microsoft?—and roles—sales?—gamification will be increasingly practical as a management tool.

    Having said that: gamification may supplement (replace?) management, but not “leadership”. A huge part of leadership is the act of being listened to by one’s leader, which has yet to be gamified. :-)

  • http://www.newcommbiz.com/ tacanderson

    If anything management by gamification would actually require much, MORE leadership. Real leadership is already becoming increasingly important. Interestingly my gut reaction is to agree with you that gamification and manager-less management would work better in knowledge based jobs but I was surprised by the Morning Star case study because here was some very progressive and open leadership in a food production company. People working on a factory line were making this work and leading their industry because of it. It’s pretty amazing. So if it works in this setting that tells me it has to work in organizations that we traditionally think of as flat and innovative. 

    Thanks for the comment Bruce. 

  • http://www.newcommbiz.com/ tacanderson

    This is incredibly encouraging. I expected a lot of resistance for this idea, even from people in industries we would normally think of as “innovative” like tech but to hear support from someone who works in a more “traditional” industry and deals with things like supply chains and unions, I’d say that’s pretty good. Granted, you’re probably not the average general manager and like you said, we did grow up with the nascent implementations of gamification. 

    But maybe this shouldn’t come as such as such a surprise since the example of the management-less organization comes from Morning Star, a tomato products company. Maybe the companies that will lead the way here into the new future of management won’t be the “usual suspects.” I’d actually love to see that. 

    And double thanks for the comment Bryan. 

  • Bryan V

    Any organization that relies only on the traditional strategies of employee engagement and management (annual reviews, decision hierarchies etc) as their only methods of interaction will continue to be successful only if they have a unique product or service that allows them to.  And then it will only last until an innovator comes and takes that market away.  I’m certainly not suggesting that highly infrastructure dependent industries will disappear overnight (or am I, Detroit anyone) but as we all continue to come to grips with a much more interdependent economic system where information no longer “moves” at the speed of light but in fact just “exists” in a place for anyone to access, I believe that the workforce and their productive capacity will follow suit.  Employers cannot rely on stability as the only tool to retain associates, they will and do leave for employers who offer them the chance to feel like they are a contributor and not a cog in the machine.

    There are no easy answers.

    By the way, you know I’m not your “typical” anything.  And I miss these light hearted chats we used to have.  Keep up the good work, I really enjoy your posts.

  • http://www.jeremymeyers.com/ Jeremy Meyers

    I would be really interested to see how this hypothesis holds up to the “Drive” test of extrinsic vs intrinsic motivators.  I’m not sure ‘win badges’! is enough of an internalizable (its a word cause i say its a word, dammit) value exchange for people, especially when it comes to creative non-rote work.

    Maybe what you’re talking about is more about closing the feedback loop for achievement and project work, which I completely agree is broken in 99% of workplaces.  We each need to know that our work is recognized and valued, and so many managers are so bad at that.

  • http://www.newcommbiz.com/ tacanderson

    Exactly. I think most people are over-managed to the point that they’re less productive and that the feedback loop is broken, especially the peer feedback loop. I think gamification can help with the feedback portion (which is what most of the tools mentioned are focusing on) and as the HBR article mentions the Morning Star employees each have personal mission statements and make individual commitments to their peers (intrinsic motivation). 

    But one point in Drive is that sometimes we still have to do work that’s not motivated by intrinsic motivation, it’s just stuff that has to get done. I think that this is another area gamification can play a key role. 

  • http://about.me/jkiss James Kiss

     Interesting thoughts Tac. I definitely think a revolution is in order with regards to management style/thinking and their positions overall. I’d elaborate more on my thoughts but I fear it would turn into whining…

  • http://www.jeremymeyers.com/ Jeremy Meyers

    How does that compare to what WE does with their annual goals? (not saying they do it poorly or well…just curious as to how you think it applies and how effective it is)…though maybe you dont want to talk about it on your blog :)

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  • http://www.newcommbiz.com/ tacanderson

    Employee recognition is a big part of what’s expected for managers at WE. WE also does a good job with employee plans and goals and do tend to focus on personal development not just professional development.  But people and managers aren’t perfect. Things get overlooked. I think that’s why a system like this would help at any company. 

  • Allan A, Toronto

    Gamification will not replace management, but aid management in the annual evaluation of their employees. I was against it 15 minutes ago, but thinking about how it could be implemented, I’m all for it now.

    Get your game face on!

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  • Jmoede

    Does the success of gamification strategies rely on people liking and responding to gaming in general?  Will it work for me even though I have absolutely no interest in video/online games?  Does liking solitaire and poker count?  Would the success  of gamification rely also on the quality of the gaming mechanisms?  Is the real market value for people who are really, really good at developing compelling games, or is the nature of the game less important?

  • http://www.newcommbiz.com/ tacanderson

    No. Yes. N/A. Yes, kind of. More like relevance.

    Its not about creating games, its about using game theory to motivate people. Gamification can be games, like in the video I mentioned but it can be something as simple as a leaderboard or certain recognition rewards.
    Similar tactics are being used in companies today, like the ‘X number of days since an accident’ signs. That’s a simple version of gamification.

  • http://www.emee.co.in/ Siddhesh Bhobe

    Very interesting article, and spot on! We have invested significantly in gamification within our 6000 person company, and are now taking our products to market. The initial sell is easy, people love the concepts… then they worry about whether it robs the seriousness of business. I guess all it will take is a couple of great case studies and mind share before people wake up and stop resisting!
    Check us out at http://www.emee.co.in and http://www.facebook.com/cafe.emee

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