Editor: We had an opportunity to interview the CEO of CollabWorks, Michael Grove, who explained the vision behind his company and what may be a huge breakthrough in the art of corporate management. Mike believes he has found the secret to how to grow a company from a start-up to a billion-dollar corporation without losing the small company’s adaptability and ability to innovate.
Kindly walk us through the inception of CollabWorks. A brief introduction to the company.
We began our journey with research on how corporations can become
nimbler and more virtual. We worked with Cal Berkeley’s Haas School of
Business and interviewed 26 corporations including Facebook and
Autodesk. The result of this research and over 20 subsequent workshops
lead to the fundamental insight that organizations need to optimize
around individuals and teams instead of around structure and job roles.
We are now aiming to streamline managing and empower the individuals
to manage the customers they serve. Our thesis is: the less managing
overhead, the more agile and productive you become. We recommend
limiting managing to the bare bones essentials.
CollabWorks has created a new patent-pending technology that
represents a new class of software that we call Digital Management
Systems (DMS). We named our DMS product FrameWork. It incorporates
management best practices with special focus on improving external and
internal customers’ experience, setting measurable objectives and
priorities, and continuously adapting to drive increased value creation.
The CollabWorks FrameWork application reduces managing time, waste,
and misalignment of talent by creating transparent and efficient
communication between teams and managers.
CollabWorks is now in the early stages of revenue with a fully
functional and proven enterprise platform. The company is led by a very
experienced team that has previously delivered multiple start-up
What are the current trends you observe in today’s landscape
that you serve? How is CollabWorks positioned in concurrence with those
Overall, competition across most industries is becoming more dynamic
and fast-paced. Speed and agility are becoming more important than
traditional strengths such as process improvement and control. Companies
can no longer afford deep silos and time-consuming synchronization
meetings. To speed up decision processes, more needs to be delegated to
individuals and teams who directly serve internal and external
customers. Jobs or titles do not create business value – people do.
Thus, the successful organizations in the future will become more
human-centric where the alignments of individuals with corporate goals
are what drive increased value creation.
What is the pain points you are trying to address in the industry today?
Talent is in short supply, yet a significant portion of the existing
talent is being underutilized, misaligned, and less than fully engaged.
In spite of management training and periodic reorganizations, large
organizations continue to operate inefficiently. Typically, the larger
the organization, the greater the inefficiencies.
What is missing today is a transparent metric for the work produced by
worker x for customer y and at value z. The FrameWork includes several
metrics that measure quantitatively the value and margin contribution of
the all work performed. Thus, the benefits of both small and large
improvements across the organization become quantitatively clear and
What differentiates/separates your solutions from the rest of
your competition? Why should a potential customer choose you over the
Our biggest competitor is the status quo. Clarifying work and its
quantitative value is new and different. The idea of putting management
and improvement processes into software is new and different. We
currently have not discovered direct competitors although we are
confident that the DMS market will eventually exceed the CRM SaaS
Is there anything else we have missed to cover or something you would like us to specifically highlight in the article?
We believe that the largest business opportunity worldwide today is
to encourage innovation from the whole workforce. We essentially have
managed the same way for 100 years and it shows as huge losses in value
creation. Billions have been spent trying to improve work productivity
as well as moral and the results point largely to failure. Engagement
scores, turnover, revenue per employee, etc., are not improving. Our
view is that organizations need to shift their focus from refining job
roles and processes to customer-driven responsiveness empowered by a
human-centric organization were the individuals own and manage their
direct customers’ experiences. In effect we need to evolve steadily to a
more market-driven entrepreneurial model of a fluid start-up like teams
where value creation is measured and rewarded by individual
performance, not by job title or position.
As entrepreneurial CEOs who fund our ventures or executives who grow into being CEOs of more mature companies, we produce annual budgets and financial plans. We estimate our future revenue and given available capital we fashion budgets we believe will deliver our revenue objectives. Hard capital and non-labor expenses are generally predictable. Workforce planning is more of an art and boils typically down to headcount planning. The amounts and types of headcount needed are often based on proforma financial modeling and estimates from primary functions such as engineering, sales, marketing, etc.
Traditional headcount planning falls short. We continue to rely on a traditional headcount model even though it’s crude and includes built in biases such as incremental benchmark planning from last year, organizational and process complexity that hides waste, and the talent of managers negotiating beyond real needs. Market forces and technology advances are increasingly exposing the weaknesses of headcount planning and staffing. For example, employees now only amount to about 65% of the workforce down from 90% twenty years ago. The remaining contingent workforce (QuartZ) is expected to exceed 40% by 2022. While HR is responsible for acquisition of employees, the contingent workforce is frequently managed directly by managers or procurement.
How do you leverage the available talent to perform the most important work? The answer is not more complex management approaches that don’t scale. Better job descriptions or skills matching won’t do it unless the work and its value is clearly understood.
Bots are coming — where do they belong? In addition to the complexity of managing and estimating the needs for people, bots are becoming an important and integral part of workforce management. Billions of dollars are being invested in AI (bot) solutions that are designed to replace some or all of the work traditionally allocated to people in jobs that include repetitive tasks that can be automated. (Deloitte). The forecast for bots as a percent of the workforce vary wildly from 10% to beyond 30% (Singularity) by 2022. A major startup, Automation Anywhere now has more than 15 million bots implemented in 700 major corporations.
As CEOs we need to wake up to this new reality. We are in a digital world where defining jobs and allocating heads will no longer yield a competitive human capital operating model. For example, does our current staffing process clearly define the optimal mix of employee, contingent, and bot labor for our 2020 “digital” workforce plan? Who and how can our team provide a clear reliable answer? If our workforce represents 50% of our total expense and our workforce includes a 10% inflated headcount – we are leaving 5% operating profit on the table. This is huge! Getting to the optimal answers will not come from doubling down on the headcount planning process. Worse, competitors who learn to optimize their digital workforce composition can use their margin advantage to improve market share, etc.
Talent related SaaS software vendors are stepping up. The good news is that SaaS solutions are evolving to make it easier to manage both employees and contingent labor. Modern HR tools such as Workday, SAP’s Success Factor, and a host of startups are offering to support contingent labor with much of the employee talent management functions such as staffing and reviews.
While an improvement, these platforms will not address optimizing the work content among employees and contingent labor nor do they include bots.
The core of digital workforce planning is the work and its value. In order to get at wasted use of talent, planning biases, and the increased complexity of available sources of talent it is essential to start with the value the workforce renders in achieving business outcomes – namely, the work. In addition to work, the second necessary information for digital workforce planning is the use of talent. For example, how much top talent work is your top talent doing? Neither the work quantified by FTE per service or use of talent is achievable with current headcount planning and management tools.
Current methods of measuring the work are not effective. We can track tasks such as monitoring locations and network devices as often done by large software development organizations. Or, we use surveys of time tracking such as activity-based planning implementations. These methods are time-consuming, prone to errors, difficult to value, and hated by workers.
Introducing a management framework SaaS solution (CollabWorks). However, technology has now evolved to allow management to focus on delivering the most valuable work with the best available talent. The first step is to capture data that clarifies what is the work, the amount of FTEs spent doing the work and by whom at what level of talent. In addition, to optimize both the work and the use of talent, a metric is needed to value both.
All work can be described as services. What we can learn from the rise of SaaS work platforms such as Upwork or Gigster demonstrate is that work can be described in the form of services instead of tasks. A service describes work delivered by a supplier to one or more customers (internal or external). While tasks may vary and come and go, services describe a supplier-customer relationship where tasks flow across the service. For example, we use software developers via Upwork who continuously perform tasks as part of services where the value of the work is established. These platforms are now being used to align service needs with both contingent and employee workers.
Customers need to drive the flow of work. Another positive reason for describing all forms of work as services is recognition that the value of work (services) depends on the customer receiving the benefit of the work. Rather than distributing the work via a typical management top down structure, work as services can be distributed based on customer needs. This keeps the
focus on value where it belongs – the customer. And this relieves line management from gathering, reporting, and communicating activities. Organizations are now able to clearly understand the services within a workforce consisting of employees, contingent workers and bots. And more importantly, for each service the organizations are able to measure the relative contribution to operating profit.
Summary. These new SaaS management frameworks (CollabWorks)will integrate with existing SaaS talent and work platforms to enable both workers and the organizations to optimize their respective needs to their mutual benefit.
About the AuthorMichael Grove is the Founder and CEO of CollabWorks, a technology company that provides a powerful management framework (FrameWork™) in the form of software and professional services. His core belief is that if individuals are empowered to manage their own engagement they will thrive to the benefit of themselves and the organization. The FrameWork technology sits at the center of the Digital Workforce of humans and automation (AI). Michael’s vision is that work will evolve from jobs to a marketplace of services by 2025.
Michael currently co-hosts CEO workshops and sponsors the CollabWorks Thought Leadership Team (TLT), DisruptHR (Bay Area), and Disrupt.Work. He has been a successful CEO for over 25 years of venture and self-funded companies including Open Country, Micromodule Systems, Introplus, and the Pathway Group. Michael has produced several breakthrough patents and led businesses in aerospace, renewable energy, semiconductor, information, social networking, and workforce management. Michael holds Bachelor and advanced degrees from California Polytechnic, UCLA, USC, and Wharton.
For years now, we have talked about the HR function and speculated how it may change going forward. Talent acquisition (TA) is a good example of an area of HR that will likely change a lot going forward because it has several tedious and repeatable (automate-able) work steps. If the primary role of TA is to meet headcount objectives, then the time-consuming aspects of TA could be automated or outsourced. Our research indicates that about 25% of HR’s existing functions could be performed by automation (machine learning, etc.) by 2023. (TA represents about 40% of the automation opportunity.)
The Elephant in the room is that change is coming to HR and the function must reinvent itself to stay relevant.
The good news that HR is fully capable of transforming into a strategic business function. The rabbit hole is also in the room. HR can be the function that delivers increase business performance from the organization’s use of talent. Instead of just being a service to the BU’s, HR can also be responsible for optimizing the talent to achieve the revenue forecast. Why HR? Like Finance, HR is cross functional and is the only function where the hiring, developing, and retaining talent are core responsibilities.
In order to own the business performance from use of talent, HR needs new capabilities that are relatively easy to develop. First is understanding and managing the use of talent. To do so, HR needs to know (with data) what the talent is doing (the work) and how the work aligns with workers’ talent capabilities. For example, our research shows that top talent on average is only doing 30% top talent work. So, the first step for HR should be to help the BUs increase top talent work per top talent worker from 30% to 50%. The result is an increase in value creation and most likely a reduction is new headcount needed.
Secondly, HR needs to be able to establish and support value-based objectives inside the BUs. Like Finance uses budgets to control costs and minimize waste of financial resources, HR could use new tools and data to create talent “budgets” to ensure that talent is used efficiently. Current HR tools such as assessments, pulse-surveys, OKRs, and performance reviews focus on individual employees and their engagement. While important, there is no hard correlation between actual value produced and worker engagement. In order to drive workforce margin contribution, HR needs to establish objectives and provide services to the BUs that measure and correlate the use of talent with margin contribution to the company.
CollabWorks provides important capabilities needed to HR to become a strategic business function.
Our focus at DisruptHR SF is to present new ideas, innovation, and thought leadership that will help HR leaders transform HR into a strategic business function. We need your support and talent as executives, thought leaders, and innovators! Please apply to be a speaker. And please join our DisruptHR SF community and participate at our October 15 event.
As CEOs we often worry about talent. Can we achieve our
objectives? Why are employees turning over? How competitive are we? Yes, talent
is critical. But, the use of talent is what delivers value.
Why does talent
use matter? Low Hanging Fruit to Improve Margins.
Talent is what
delivers value and talent use is the efficiency of delivering that value.
Wasting or misusing talent directly affects business value. We depend on
managers to identify and allocate talent. We don’t do a great job of talent use
because our headcount planning and allocation methods are crude, and we don’t
have a reliable way of measuring talent use. Net profit (and cash flow) is
directly correlated to talent use. The less talent needed to achieve the same
revenue then greater the profit margin. As indicated, just a two percent
improvement in revenue/labor will improve margin contribution (EBITDA) by 1-2%.
If the planning process continues to improve talent use over current methods,
then the margin contribution is cumulative! For example, 3 years of 2%
revenue/labor improvement will produce a 5% gain in EBITDA. In addition to the
financial benefits, effective talent use produces improved talent motivation
What is the use of talent why alignment matters? Headcount Planning
is Wastes Talent.
We define talent use as talent performing work. We relate
talent value to the value of the work produced. For example, we pay more for an
airline pilot than a stewardess because pilots require more talent and produces
more value. Airlines optimize their whole routing system to optimize talent
use. The problem with the headcount-based financial model is that there is no
clear quantifiable data regarding the use of talent. Job titles, roles, and
compensation are not connected to talent use unless the work is highly defined,
and the talent use is highly structured. Assembly lines for example. For nearly
all knowledge workers, it is the alignment of the right talent to the right
work that optimizes talent use and margin contribution.
Use case: An
engineering group increased top talent use. 15% gain in margin contribution.
A very high-performance technology group was experiencing
frustration and turnover from their top talent. Why? They were required to
perform work that lower level talent could perform, and they were required to
interrupt their development to attend useless meetings.
As shown, the group
using the CollabWorks management FrameWork identified their current use of
talent and then executed on several management sponsored improvements that
yielded a 15% increase in top talent use after 15 months. Since top talent work
is considered high margin contribution per employee, then the management
estimated an improvement in margin contribution of 55%.
Does size matter? No.
The earlier you develop best practices the bigger and quicker the pay off.
are small it is easier to correlate the use of talent with achieving financial
outcomes. As organizations scale we depend more on financial modeling and
budgets to allocate talent and the effectiveness of talent use becomes opaque
and talent waste and misuse grow. Even early round venture funded startups can
yield poor talent use as intense demands on management leaves little time to
focus on talent use. Developing early talent use best practices will pay off in
business performance for both management and the investors. As shown, a D round
investment can improve investor return by 19% by adding just 85% of the planned
labor to achieve the same revenue.
The Impact of 5% in improved
profit margin is strategic. Early adopters win, laggards lose.
Times change, and we evolve. Most of us had not
heard of Design Thinking 10 years ago. Now it is the new normal. The ability to
manage and measure talent use is now available and will become standard
management practices. The benefits over time are huge, yielding an unfair
advantage for early adopters.
began with a simple concept: Optimizing
talent value works best when both the individual and the organization benefit. Since
then we have sponsored workforce innovation as thought leaders, sponsors of
events, and developers of technology that will allow organizations to shift
from managing labor cost to managing labor value.
We are all
familiar with the outside-in management models practiced for decades where the
organization functions from top-down.
The workforce is defined by job descriptions and headcount. And,
managers set objectives and manage individuals (you). The whole point of
management is to keep the workforce focused on doing the most valuable work
needed to meet the organization’s objectives.
Results: Talent Misuse
Outside-in organizations don’t scale well. Outside-in is the root cause of inefficiency, waste, and inertia that ultimately dooms many organizations as they become too slow and inefficient to adapt. The outside-in model assumes that a “job” performed produces value when in reality there may be little correlation between the job and value. It is the actual work that produces value that drives business performance. Those doing the work are the sources of the value. This is obvious and yet while organizations are spending billions to manage talent better, the waste, disengagement, and turnover continue, while talent shortages are rising.
Shift to Inside-Out Management
years of research, executive interviews, and many workshops, CollabWorks has concluded
that the answer to workforce inefficiency is to start with a focus on the
source of value creation and work backwards. If it is the work that produces
value, then create a management model that begins with the individual and
optimizes their ability to create value. We call this approach an inside-out management model. The
inside-out model works well co-existing with traditional outside-in management.
Instead of the “job” being the means of allocating work, the work and its value
become the basis for deciding what individuals do. Inside-out means that each
individual at all levels of the organization clarifies and manages their own
work to the mutual benefit of themselves and the organization. To enable this
shift, CollabWorks has created a technology and SaaS process that starts with
the individual and provides a simple yet very effective means of clarifying and
improving the value of the work performed. This revolutionary inside-out
management model is called the FrameWork™.
Managing from the Inside-Out
FrameWork starts with each individual (you) regardless of organizational
structure, job, or type of worker. You set your objectives, priorities, and
measure your outcomes. You identify improvements and initiate actions to
improve your capabilities, use of talent, and address your desires and needs.
The key metric is value creation, and the FrameWork provides you quantitative
data to assist you in optimizing the use of your talent.
How do we
know work has value? If we think of simple market mechanisms, let’s say of a
farmer selling tomatoes to customers in a market. Depending on the quality of
the tomatoes and the customer needs a transaction occurs when both parties
agree on a value exchange. A premise of
the FrameWork is that this kind of market value exchange applies to all forms
of work. Value is attributed to the work when customer(s) (internal or external
to the organization) confirm the work’s value. Another premise of the FrameWork
is that all work can be described as services where each service is serving
customer(s). The FrameWork provides you a simple means of defining your work as
services and then to clarify the customers who attribute value to each service.
Instead of your manager managing you, you manage your customer’s experience
with your service. Your “job” is to ensure your work is addressing
your customer’s current needs and to consider improvements to address future
All Services to Customers = Talent Use
In most cases, you serve several customers such as a your team,
other functions, lab partners, managers, or the entire organization. The
FrameWork makes it easy to identify your entire service profile. The sum of
your services represents the use of your talent. The value received by your
customers represents collectively the value of your services.
Agile Process of Managing
continue to play an important role moderating outside-in strategy and direction
with inside-out empowerment and coaching of individuals (you) to better serve
customers. Individuals own their service profiles and the creation of valuable
work on behalf of their customers. By continuing to adapt to changing customer
needs, individuals at all levels of the organization are using lean-like management processes. Managers
set direction and focus priorities on business strategy. However, managers no longer
need to distribute and manage tasks, then provide reports to their superiors as
frequently occurs when work flows through a job structure. The management of
the work is 80% owned by those doing the work. This liberates both the manager
and their team members to focus on optimizing their own value. The FrameWork
provides a simple consistent process with clearly defined roles. Managers can
be traditional line managers, team or project leaders, or temporary. The result
is a lean and agile focus on best means of serving customers.
Agility Requires Ongoing Improvements
improvement of services is built into the CollabWorks management FrameWork thus
producing a more agile and resilient organization. As ideas are captured, those
most aligned with objectives and needs are selected as potential projects.
Gamification and voting are used to promote and select opportunities. Those individuals
with the most passion and commitment to creating an improvement form teams who
in turn create clears ROI plans and seek approval. The projects can be
strategic or simply changes to eliminate low-value work, waste, or address
Ongoing Improvement Transformation
FrameWork maintains past, current, and future service profiles (work) for each
individual and then rolls up the data for any team, group, function, and
organization. Past profiles represent a history of services and changes which
can demonstrate reduced talent waste, improved talent alignment, and capability
growth (or not). Future profiles represent opportunities to better address
customers, the organization, and the needs of the individual. The gaps between
future and present are clearly identified and often include desired objectives,
changes in services, and actions defined to satisfy the transformation. Trends
and correlations can be seen providing insights and lessons to further optimize
individual and team talent use and ultimately the whole workforce. The
FrameWork supports all forms of change management such as design thinking,
lean, and agile processes.
Improvements By Teams/Groups
profile changes at the group level are the sum of those service profile changes
of the participants in the group. The FrameWork process is entirely transparent
to the type of worker, group, or management structure. Thus, the FrameWork will
blend into any existing organization and culture while providing an agile
market-like process of responding to rapid changes in work demands and talent
Measure the Increase in Talent Value
FrameWork is a powerful mathematical model which produces customizable
algorithms, metrics, and data to guide your decision making and to predict
outcomes. The data model is rich with insights, benchmarking, and correlations
– addressing issues such as service value versus compensation, the alignment of
talent to services, relationship between personal growth and job satisfaction,
applications for bots, and eliminating bias.
You Have More Talent Than the You Think
inside-out FrameWork allows you, your teams, and the whole organization to
clarify and improve the use of talent and the value provided customers.
Financial modeling of the organization can now include a correlation of
top-down financial performance with the value of the services driven bubble up
by sum of individual, group, and functions. The cumulative margin contribution
of the workforce can now be analyzed, predicted, and benchmarked to aid management
decision making in optimizing the workforce. Current outside-in models waste
talent. Inside-out models compliment outside-in models and provide the insight,
motivation, and data to leverage the most valuable use of talent. Automation
and bots are not the enemies of talent, rather they are the opportunity for you
to achieve more including your compensation.
“You win, then we all win™” is a natural outcome.
Try IT: Increase Your Talent Value
the FrameWork is easy. In less than an hour, you can create your first services
profile. You will clarify the services (work) you perform and for whom (your
customers). You will assess the relative value of your work. Once clear on your
current services, you can consider changes that would increase your value. You then
can set objectives and identify improvements you want to achieve on behalf of
yourself and your organization. The
FrameWork makes it easy to quantify and track current and future service
profiles and your outcomes of addressing objectives and improvement projects. Reviewing
your progress takes minutes and is typically done monthly. The use of your
talent is your biggest and most important asset. Spending 1-2 hours per month
managing your talent will cause you to realize you a lot more talent then you
Getting Started: Just Ask for a Log in
CollabWorks is working with individuals who want to self-manage
and corporations who want to grow rapidly and scale efficiently. Anyone can
discover ways to increase their services value – including CEOs who frequently
discover unproductivity habits and within hours are able to shift their time
and focus to higher value work. Engineers appreciate the quantification and
correlations FrameWork provides and the ability to clarify and address wasted
work. HR managers see the inside-out model and an effective way to motivate
employees while providing them data to help them optimize the use of talent.
The Framework is free for individuals and your success is our primary goal. As you improve yourself you will earn points and our plan is to reward you a share of our profits. At CollabWorks we live our motto – You Win, then We All Win. We are looking for passionate early adopters who want to reinvent the outside-in model of running corporations. Help us build an inside-out community of awesome self-managing achievers and let’s create a movement!