Why Value Is King & ‘Departments’ Should Die

As we amble our way into the new economy, we find more and more that everyone is (rightly) obsessed with value.

Value, after all, is what work is about, right?

We work because it is valuable to us (it uses our gifts/strengths) and because it’s valuable to society (makes the world better).

Wait… you say that’s not what most work is about?

You’re probably right, but that’s not because the idea’s not true. No, it appears that we’ve been told a lie.

We’ve been taught that the purpose of work is to strive for money, which confuses the whole idea of value. But money on its own isn’t valuable at all. Money is only a middleman, an imaginary construct that helps us trade for the things we truly value. (Most of our financial system is set up to encourage confusion around this, which also doesn’t help.)

This problem in the way we view work spills over into the way we design our organizations. We see it very clearly in the way certain jobs are valued more than others. Some of this makes sense,* but the inequity has blown WAY out of proportion.

To help combat this alarming trend, organizations should re-think the way “departments” are done. Right now, our companies are built around function — a department exists because all the people in it “do” similar things. But as more work becomes more about knowledge, the value of a job is found less in its function, and even less in a “job description.” (The world is reorienting too quickly for the static conceptual dinosaur we call a “job description” to survive. Even now, they’re just a formality that gets stuffed in a drawer and ignored.)

Instead, companies must re-organize into what I call “value groups.”

There are really only five different ways that an individual can create value in the organization they work with. These are the 5 C’s of Value Creation:

CREATIVE

The Creative group creates value by creating a remarkable product that is efficiently and sustainably produced. These people are found in the former departments of design, manufacturing, engineering, and research & development. They love turning ideas into reality.

These people make stuff.

COMMUNITY

The Community group creates value by building a tribe of brand ambassadors around the company’s products or services. They build relationships. These people used to be referred to as “sales.” But to really work in the new economy, they will need to become more about WOW’ing customers and fostering an ongoing conversation than anything else.

These people connect customers to something that makes their lives better.

CULTURE

The Culture group creates value by ensuring the organization has a healthy and vibrant culture which appreciates and develops its people. This group will be an entirely new construct in tomorrow’s economy. (Some will say this should be what HR evolves into, but most HR departments aren’t positioned to evolve to the extent needed — although many of the people who work there will fit well here.) There are already flickers of life happening in this area, but we have a long way to go.**

These people cultivate and grow a healthy work environment — they’re like a mashup of curator, farmer, and storyteller.

CURRENCY

The Currency group creates value by managing the flow of money to the internal team (employees) and the external constituents (vendors). Everyone from the CFO to all accountants and payroll people fit here. They help find and provide the resources to fund great projects.

These people are numbers and data people (they love them).

CONDUCTOR

This person was formerly known as the CEO. They used to sit at the “top” of the pyramid and look down upon loyal (or not-so-loyal) subjects. No longer — the power has shifted. Now they look up into the organization. Primary job is talent liberation, enabling every individual to realize their potential. Creates value by overseeing that the other 4 C’s work “in concert.”

This is the “big cheese” who realizes he or she is now leading from the bottom of the pit, like an orchestra conductor.

By reorganizing in this way, it is ensured that every individual in the company is provided a very clear structure for how they create value for the organization.

This model will not only help people think differently about how their individual talents and strengths contribute to creating value in their work, but also provide a clear framework for how a company can be physically reorganized.

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P.S. Let me know in the comments if you think I’m missing any ways people create value in a company. Seriously, I’d love the help — I need to know if I’m missing anything here!

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*It does seem fair for payment to be commensurate with the pressures of a specific job. For example, it’s probably safe to say a Starbucks executive carries more organizational pressure than a barista does, and therefore should earn more to compensate. But how much more? That’s a very important question that we’ve been utterly failing to answer appropriately. UPDATE 3/11/11: Seth Godin just made some great additional comments on this idea here. It’s not just about additional pressure but also scarcity of certain knowledge/skills/experience.

**Also check out Zappos’ Kan-Du team.

UPDATE 3/3/11: Check out this page of charts on income inequality. It’s mind-blowing.

ADDITIONAL RECOMMENDED READING: “Why Work?” by Dorothy Sayers

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