Reference no: EM131069739

CASE
W. L. Gore & Associates

Founded in 1958, W. L. Gore & Associates has become a modern-day success story as a uniquely managed, privately owned, family business. Founders Bill and Vieve Gore set out to explore opportunities for fluorocarbon polymers, especially polytetrafluoroethylene (PTFE). Today Gore is best known for its Gore-Tex fabric and Elixir Strings for guitars. Gore is the leading manufacturer of thousands of advanced technology products for the medical, electronics, industrial, and fabrics markets. With sales of over $2 billion, the company employs approximately 8,000 associates at more than 45 facilities around the world. Terri Kelly replaced Chuck Carroll as the president and CEO of W. L. Gore & Associates in April 2005. In 2008, Gore was named one of the nation's best companies to work for by Fortune magazine. It was the 11th consecutive year that Gore appeared on the list. CEO Kelly said 2008's selection was particularly meaningful because Gore was celebrating its 50th anniversary. According to Kelly, all of Gore's practices and ways of doing business reflect the innovative and entrepreneurial spirit of its founders. "Our practices stress maximizing individual potential, cultivating an environment that fosters creativity, and operating with high integrity in everything we do," she said.94 CEO Kelly attributes Gore's success to its unique culture. How work is conducted at Gore and how employees relate to one another sets Gore apart. There are no formal job titles. Compensation and promotions are determined by peer rankings of each other's performance. To avoid dampening employee creativity, the company has an organizational structure and culture that goes against conventional wisdom. W. L. Gore & Associates has been described as not only unmanaged but also unstructured. Bill Gore (the founder) referred to the company's structure as a "lattice organization." Gore's lattice structure includes the following features:

• Direct lines of communication-person to person-with no intermediary
• No fixed or assigned authority
• Sponsors, not bosses
• Natural leadership as evidenced by the willingness of others to follow
• Objectives set by those who must "make them happen"
• Tasks and functions organized through commitments
• Complete avoidance of the hierarchical command and control structure The lattice structure as described by the people at Gore encourages hands-on innovation and discourages bureaucratic red tape by involving those closest to a project in decision making. Instead of a pyramid of bosses and managers, Gore has a flat organizational structure. There are no chains of command, no predetermined channels of communication. It sounds very much like a self-managed team at a much broader scale. Why has Gore achieved such remarkable success? W. L. Gore & Associates prefers to think of the various people who play key roles in the organization as being leaders, not managers. While Bill Gore did not believe in smothering the company in thick layers of formal management, he also knew that as the company grew, he had to find ways to assist new people and to follow their progress. Thus, W. L. Gore & Associates came up with its "sponsor" program. The sponsor program is a dyadic relationship between an incumbent, experienced employee and a newly hired, inexperienced employee. Before a candidate is hired, an associate has to agree to be his or her sponsor or what others refer to as a mentor.

The sponsor's role is to take a personal interest in the new associate's contributions, problems, and goals, acting as both a coach and an advocate. The sponsor tracks the new associate's progress, offers help and encouragement, points out weaknesses and suggests ways to correct them, and concentrates on how the associate might better exploit his or her strengths. Sponsoring is not a short-term commitment. All associates have sponsors, and many have more than one. When individuals are hired, at first they are likely to have a sponsor in their immediate work area. As associates' commitments change or grow, it's normal for them to acquire additional sponsors. For instance, if they move to a new job in another area of the company, they typically gain a sponsor there. Sponsors help associates chart a course in the organization that will offer personal fulfillment while maximizing their contribution to the enterprise. Leaders emerge naturally by demonstrating special knowledge, skill, or experience that advances a business objective. An internal memo describes the three kinds of sponsorship and how they might work:

• Starting sponsor--a sponsor who helps a new associate get started on his or her first job at Gore, or helps a present associate get started on a new job.

• Advocate sponsor--a sponsor who sees to it that the associate being sponsored gets credit and recognition for contributions and accomplishments.

• Compensation sponsor--a sponsor who sees to it that the associate being sponsored is fairly paid for contributions to the success of the enterprise. An associate can perform any one or all three kinds of sponsorship. Quite frequently, a sponsoring associates a good friend, and it's not uncommon for two associates to sponsor each other as advocates. Being an associate is a natural commitment to four basic principles articulated by Bill Gore and still a key belief of the company: fairness to each other and everyone we come in contact with; freedom to encourage, help, and allow other associates to grow in knowledge, skill, and scope of responsibility; the ability to make one's own commitments and keep them; and consultation with other associates before undertaking actions that could affect the reputation of the company. Over the years, W. L. Gore & Associates has faced a number of unionization drives.

The company neither tries to dissuade associates from attending organizational meetings nor retaliates against associates who pass out union flyers. However, Bill Gore believes there is no need for third-party representation under the lattice structure. He asks, "Why would associates join a union when they own the company? It seems rather absurd." Commitment is seen as a two-way street at W. L. Gore & Associates--while associates are expected to commit to making a contribution to the company's success, the company is committed to providing a challenging, opportunity-rich work environment, and reasonable job security.

The company tries to avoid laying off associates. If a workforce reduction becomes necessary, the company uses a system of temporary transfers within a plant or cluster of plants, and requests voluntary layoffs. According to CEO Kelly, Gore's structure, systems, and culture have continued to yield impressive results for the company. Gore, she said, has consistently grown revenues at a 7 to 9 percent rate for the past decade and voluntary turnover is just 5 percent--a strikingly low number for an industrial company with more than 45 manufacturing plants worldwide. GO TO THE INTERNET: To learn more about W. L. Gore & Associates, visit its Web site (https://www.gore.com). Support your answers to the following questions with specific information from the case and text or with other information you get from the Web or other sources.

1. What theories from this chapter are revealed through the case?

2. How did Gore's "sponsors" program facilitate the creation of high-quality relationships among leaders, sponsors, and associates?

3. Evaluate followership at W. L. Gore & Associates. What company actions and/or policies account for the quality of followership?

CUMULATIVE CASE QUESTIONS

4. Would you characterize the leadership style at W. L. Gore & Associates as job-centered or employeecentered (Chapter 3)? Support your answer.

5. Based on the types of power discussed in the text, what type(s) of power do sponsors have in their relationships with associates (Chapter 4)?

6. What role, if any, does coaching play in W. L. Gore's lattice structure (Chapter 6)? CAS E EX E R C IS E AN D RO LE -P LAY Preparation: You are part of an organization that evaluates its employees at the end of each year. The month of the year when evaluations need to be completed by all leaders and managers is approaching. Your task is to play the role of a leader evaluating your followers, and then play the role of follower being evaluated by your own manager. Based on your understanding of the discussion of guidelines for effective leader feedback and guidelines for effective followership, (1) present a scenario of an effective and an ineffective feedback session, applying at least three of the guidelines discussed in the text, and (2) present a scenario of effective and ineffective followership, applying at least three of the guidelines discussed in the text. Role-Play:

The instructor forms students into leader- follower pairs and has each pair dramatize scenarios 1 and 2 in front of the rest of the class. After each scenario, the class is to contrast the two approaches (effective versus ineffective feedback) by identifying the guidelines that the presenters or actors employed in making their points. Different student teams should try the exercise by employing different guidelines to both scenarios.