Whether you’re building a new organization or attempting to transform an existing one, a first order of business is to bring together the best talent and develop the work culture, practices, and processes that help them work together. Creating such common ground among people from an array of different companies, each of whom are bringing their old ways of working, can be a challenge.
Josh Howell, LEI president, interviewed RJ Scaringe, founder and CEO of Rivian, a startup electric vehicle manufacturer based in Plymouth, Michigan, about how he tackled this issue. Joining them was Jim Morgan, LEI senior advisor and, at the time of the interview, Rivian COO, and Matt Savas, director, Lean Global Network. The exchange offers insight into how the startup is building the Rivian Way – and the approach any company can use to create a unique culture based on “first principles” and from the strengths of its talent.
RJ Scaringe: One of the big challenges is ten years ago, it [Rivian] was one person. Five years ago, it was probably 100 people. Two years ago, I don’t know, three, four hundred people. The process using the systems that we set up when it was ten people don’t work when it’s 50 and certainly don’t work when it’s 100. Then the process that we designed for when it was 100 ceases to work when we’re at 200, and that just continues to play out. A lot of the way things are designed and built when you’re operating at a relatively small scale, you can rely on the benefits of just simply being small. That’s the benefit of not having to manage a lot of complexity or a lot of people.
As we’re scaling now, it’s intentionally designing processes that are as lightweight as possible, but that streamline everything from how decisions are made to how capital is deployed to how we coordinate between different functions or geographically across a few locations, as well. That’s a constant state of process design while you’re flying the plane.
It would be nice if you could sort of pause everything that the business has to do and say, “Hey, for the next month, let’s work on all our processes,” but we’re also flying the plane, so pragmatically you can’t do that. We have really aggressive timelines for launching a whole host of different products. Part of it is learning to run and simultaneously swim and simultaneously design the way we’re running and swimming. It’s complex.
Matt Savas: In your book [Designing the Future], Jim, you describe something called “Enabling Bureaucracy” versus “Coercive Bureaucracy” or just a free-floating enterprise. What you just described, RJ, sounded like you’re trying to build that enabling bureaucracy. Bureaucracy is kind of a terrible word, but a way to govern a lot of people as lightly as possible toward a common mission. How are you two working together to build what you’ve described as the Rivian Way? How are you working to build that?
Jim Morgan: I think RJ described it.
RJ: Working hard.
Jim: Yeah. He described it really well. It’s sort of just enough infrastructure to help us operate effectively. As RJ mentioned, we have multiple locations. We have a lot of different functions. We also have people that come from a host of different companies, and they have all have different backgrounds, different languages, different acronyms, different cultures, or styles of working. So, we have the opportunity to learn from all of them and use that knowledge to create a new, unique-to-Rivian way of working. Easier said than done because, as RJ pointed out, we’re also developing products. We’re on a critical path.
The easy thing to do is default to what you’re used to doing. Right? What you brought with you from whatever company you came from. That also leads to people working in cliques; people who speak the same language, quote unquote, or use the same acronyms, or are used to doing things a certain way.
What we’re trying to do is be very intentional about developing the Rivian Way, whether it’s the way we develop products, the way we run our manufacturing operations, or the way we work with our suppliers. We want to pick all the best characteristics of what people bring to Rivian, but combine them in a new way, in a more effective way.
Believe me, the temptation is to sort of default to the easy way of how we used to do this, but I don’t think, in the long run, Rivian will be nearly as successful unless we’re able to do this very — I describe it as being very intentional about the way we create these processes, the way we build this operating infrastructure. To enroll everybody in that process is crucial so that they develop some emotional and intellectual investment in the way things are done. That creates this ownership that can then be sustained over time at Rivian, as opposed to sort of imposing these things on people.
While it takes more time — and can, at times, be a bit frustrating — in the long run, we’ll end up with a much more powerful culture.
Josh: So, the notion of wanting to create the Rivian Way, not try to copy some way of working from any of these other companies where people are coming from. There’s the perspective of someone like yourself, Jim, who had a background at Ford and is now, just within the last year, joining up this company and contributing to the development of the Rivian Way.
There’s also employee number one from ten years ago or some of those hundred people from five years ago who have been developing the Rivian Way since its genesis that are now experiencing the infusion of whatever, the Ford way, in your case, or the Apple way, in the case of some other folks. How is, maybe speak to your own experience of encountering these different ways of working that people are bringing into this company? Yeah. I guess if you could share a little bit about that.
RJ: Jim said this. It’s an important point. We are building a team of exceptional people and intentionally bringing people in from a multitude of different places. Whether it’s Apple or Tesla or Toyota or Ford, they’re coming in with different backgrounds, and that’s actually good. That’s what we’re going for, but…
Josh: It’s by design, not just by necessity.
RJ: Simultaneously, we have to recognize that as folks come in, we have to unlearn some behaviors or experiences and relearn and create the way we work. That’s sometimes easier said than done because there is just a lot of emotional energy that you have invested in the past and to a certain way of behaving that needs to be adjusted. It’s not a one-time occurrence. It’s an ongoing process of refining and maturing the way we work together.
The other thing that’s happening with the rate at which we’re scaling, is processes. As I said, they are changing and have to adapt to the size of the organization. Jim and I are spending a lot of time making sure we’re differentiating between tactical solutions that are appropriate for that moment in time versus philosophies or organizational behaviors that are permanent.
Josh: I’ve heard the term “First Principles” as the way you describe this philosophy.
RJ: Yes. That’s another way to look at it. When we’re 100 people five, six years ago, the tactics we used then are very different from the tactics we’re using today, but the philosophies, you treat people the right way, respect one another, transparency, these philosophies have to remain. Those started, as you said, with employee number one, with me. Sometimes if the tactics get confused as philosophies, that can be problematic. We’re very cognizant of making sure we’re crisp on the things that are sacred that can’t change, but very flexible and intentionally very fluid on the things that need to change. This is where it’s been a huge benefit to have Jim here helping to design and build what are the processes. THen, through that, bolster and improve and deepen some of the philosophies that tie to these processes.
Our strength is the team. The team is a wonderful mix of people coming right out of college to people that have been working in the auto industry for 30 years, people that have been the technologist base since the early Apple days. It’s by design, a mix of these experiences, and the mosaic of experiences that comes out of that is what forms the picture that is the Rivian team. Now, because it is a mosaic, we need to make sure we’re organized, and we need to make sure we’re thoughtful about how we combine all those pieces. And we need to be thoughtful about how we train and establish how we work together, but absolutely, our success is going to be built on the aggregated set of experiences.
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Jim Morgan, senior advisor for Lean Product and Process Development (LPPD) at LEI, will share
a first principles approach to improving new product, process, and service development at LEI’s upcoming
Virtual Lean Learning Experience (VLX).
A first principles approach to lean transformation helps you to strip away thought-limiting dogma and create bespoke solutions tailored to specific environments and challenges. In this session Jim will introduce each principle, explain why it’s important, and then, with the help of experienced industry professionals, share examples of specific practices that embody the principles from various companies Learn more and register at https://www.lean.org/summit2020
