Josiah Humphrey's parents moved from New Zealand to Australia, where he quit high school to go into business. He met Appster co-founder Mark McDonald in an online technology forum when they were both 13. As the youngest contributors, they grew close very quickly. Mark, a native Australian, quit his freshman year of college, and the two of them co-founded Appster.
In 2011, with only $3,000 to their name, the kids talked their way into a lease at the prestigious Rialto Towers in Melbourne, Australia, by lowering their voices and pretending to be older than they were. They believed Appster could become the best app development company in the world. Three years later, they live in San Francisco, have over 200 team members on three continents, and are looking to add nearly 400 more by the end of 2015. The near-term goal is to be a $100 million company by 2018 and a billion dollar leader in their industry as quickly as possible. There are few skeptics who think they won't do it.
Command and Control or Participation and Sharing?
Appster's success is not about the product, the industry, or being in the right place at the right time. Their meteoric rise is all about a new approach to leadership that heralds the demise of traditional Industrial Age management and the rise of a new Participation Age leadership model. As intellectual capital replaces physical capital as the main value-creation asset in business, command and control is giving way to leadership that promotes participation and sharing.
The co-founders of Appster have intuitively built a company that is more like a living organism, poised to dominate the future, by ensuring they, the co-founders, dominate nothing. They understand what most traditional hierarchical managers refuse to recognize: that the collective intelligence of everyone is infinitely more powerful than the capacity of a few top-down managers.
Ivory Towers versus in the Trenches
A recent leadership study sponsored by IBM included 1,700 CEOs from 64 countries. The study showed that successful CEOs tend to look a lot like Humphrey and McDonald, living in the trenches rather than in the ivory tower, and are much more involved with people than just with production.
Humphrey and McDonald epitomize the emerging face of business leadership. They don't have ivory tower offices, but hot-desk wherever they find themselves. They join meetings where there are no chairs left and sit on the floor. They use software like 7Geese and 15Five to get daily feedback from the hundreds of Appster team members on three continents. And they have weekly all-hands meetings like "Time Travel Tuesdays" to bring together Appsterfarians from India, Australia, and the U.S. Regular, transparent, two-way communications are at the core of their leadership strategy.
People Skills versus Operational Skills
But the most important difference in this emerging leadership style is that their competence is focused on people, not on operations. Humphrey and McDonald assume the opposite of classic command and control structures, which believe that the guys at the top are the smartest and most motivated, and that operational competence is much more important than people skills.
The Appster co-founders assume that every team member wants to participate in building a great company. They ensure that everyone at Appster has the freedom and the responsibility to do it. When we talked with Appster team members in Australia, India, and the U.S., they all talked about having both a personal job and a "build the company" job. In traditional companies, only the guys at the top take that on. At Appster, it's everyone's job to build a great company.
Managers versus Self-Management
For Appster, the natural outcome of such people-focused leadership is self-management. Everyone is organized into teams that make their own decisions without the presence of managers. To accomplish this, Josiah, Mark, and all of Appster, share four values around which they have built self-managed teams, which they call Tribes:
1. Change Is Good (flexibility and adaptability)
2. Radical Transparency (no sensitive souls, and no egos)
3. High Performance (including relentless discipline)
4. We Are Dreamers (we create our own reality)
Participation and Sharing Abound
Employee turnover is nearly nonexistent, at about 2 percent annually. One team member in Australia says, "It was hell in my last company. I was overworked, underpaid, and feeling totally alone. It was the worst one-and-a-half years of my life. But since coming to Appster as part of a committed self-managed team, the last year has been just amazing. The exceptional transparency we've created on our team allows me to share just about anything. We've grown incredibly close."
A team member in India says about his team, "As soon as I got here, my team required that I start thinking and making decisions. It was hard at first, but they are always there to support me. High performance, responsibility, and autonomy are emphasized here, not hierarchy. I can figure things out and just go with my decisions. In my last job, I would just get in trouble for trying new things."
We repeatedly heard team members use this phrase, "With great power comes great responsibility." Humphrey and McDonald have embedded it in the culture. The more empowered the teams are, the more deeply they feel a responsibility to take care of the company as a whole.
Believe in Other People
Josiah Humphrey says, "When I speak to older business owners, I wonder why they haven't grown their businesses faster. But it often comes down to the fact that they can't give up control. Giving up control hasn't been an issue for us." Mark agrees: "Because Josiah and I are so young, it's easy to find people who are smarter than us. Until recently, I was the youngest person at Appster. In fact, our chief technology officer has been programming longer than I have been alive!"
Going forward, great leaders will put their egos aside, then train, trust, and get out of the way. Companies in the emerging work world will find success behind leaders very unlike those who still dominate the traditional management landscape. Mark and Josiah aren't great at building apps. They've hired others to do that. They're great at building relationships and community. These aren't the "soft skills" anymore. They are the central skills to building a great company.
In its first four years, Appster has grown faster than Apple did. People-focused leadership by Humphrey and McDonald could lead the way into the emerging work world of participation and sharing.
Command and control are so '90s. (1890s.)