How Patagonia's Roving CEO Stays in the Loop
Inc. received an email recently from a start-up alerting us to a milestone in our own history. Twenty-five years ago, Inc. published an article about the 5-15 report, a management tool created by Yvon Chouinard, the esteemed founder of Patagonia.
Chouinard's Management Philosophy
Chouinard required most employees to spend 15 minutes a week writing reports for their managers about their ideas, work, challenges, and impressions of how things were going generally. The managers would spend five minutes reading each report; then curate and compile the highlights and shoot them up the chain to executives; who would read, respond, and curate in turn. The CEO would ultimately receive a distilled but thorough chronicle of life in the company. Chouinard credited this tool for keeping him on top of things during his frequent climbing and surfing jaunts. (Presumably he phoned in for the final report or had it faxed to him--if fax machines were available in the Grand Tetons.)
Inc. has a long history of writing about smart management practices, perhaps most famously open-book management, which we popularized five years after the Patagonia piece appeared. For some reason the 5-15 report--although elegantly simple and effective--did not catch fire like some others.
Now the start-up that contacted us, 15Five, is trying to change that. Based in San Francisco, 15Five embodies Patagonia's process in software it markets as a communications backbone for small-to-mid-sized companies, and departments in large companies. The company, which launched last year, just raised a $1 million round of venture financing and has several hundred paying customers.
Out-of-Office But In-the-Know
15Five founder and CEO David Hassell is a serial entrepreneur whose previous ventures include an Internet marketing firm and an adventure-travel/kite-surfing business. He personally experienced out-of-the-loop-CEO syndrome in 2005, while in Brazil on a six-month working sabbatical from his New York City company, Endai Worldwide.
"I was trying to figure out how to be effective managing a remote team," Hassell says. "I was getting the project reports and the metrics, but not the peripheral view of what was happening. And I wanted that."
A few years later, Brad Oberwager, another entrepreneur, introduced Hassell to the 5-15, which Oberwager had adapted for his own business. "I went back and read the story," says Hassell. "Yvon's worldview really resonated with me. Rather than trying to achieve work-life balance he was trying to achieve work-life integration."
If a company has a pulse, then Hassell imagined the 5-15 acting as an ever-present finger on that pulse.
15Five doesn't reproduce the 5-15 exactly. For one thing, while Patagonia's process is largely a bottom-up affair, the software directs communication both ways.
"If an employee writes something to a manager, and that gets passed on to an executive, and that gets passed to the CEO, and the CEO responds, then all four people are involved in that conversation," Hassel explains.
No Word From the Source
Hassell says he reached out to Chouinard when he started 15Five but got no further than Chouinard's assistant. ("I think he was traveling," says Hassel.) He has received encouragement from Paul Hawken, a friend of Chouinard's from back in the day who used 5-15s in his own company, Smith and Hawken, and described the practice in his book Growing a Business. As tribute to Chouinard, 15Five joined 1% for the Planet, a group formed by Patagonia's founder to channel corporate donations to environmental causes.
As far as I know Chouinard never tried to commercialize the 5-15 himself. And why should he? After all, Patagonia is a hugely-successful outdoor clothing company with no need to dabble in software. (It just recently ventured into food with salmon jerky.) So it's nice to see a young business spreading the wisdom of an illustrious forebear--and making money in the process. Seek out new ideas, by all means. But remember that some old ideas still have plenty of juice in them.