'Kind of like kindergarten'

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Firm stresses collaboration, shuns cutthroat corporate culture

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July 16, 2008|By McClatchy Tribune

Detroit - It's not true that you must work 80-hour weeks, trash competitors and gouge your customers to get ahead in today's dog-eat-dog business world.

That's what Rich Sheridan and his fellow computer programmers and high-tech anthropologists at Menlo Innovations in Ann Arbor, Mich., say.

They are dedicated to reinventing the workplace, for themselves and their clients, as a means to a more ambitious goal, which is "to end human suffering in the world as it relates to technology," says Sheridan, president and chief executive officer of the software firm he founded with three partners in 2001.

Inside Menlo's offices, above a coffee shop a few blocks from the University of Michigan's central campus, there are no walls.

No cubicles.

Nobody working long nights.

Nobody working weekends.

No work done by programmers in India or other countries.

And nobody telecommuting, which might seem counterintuitive for a technology firm in the era of virtual offices.

And if a client is a cash-starved entrepreneurial startup, Menlo might cut its usual rates for custom software by 50 percent in return for equity in the client's business or royalties from its products.

This radical-sounding departure from today's typical corporate culture isn't a new idea. It's modeled mostly on inventor Thomas Edison's famous industrial laboratory in Menlo Park, N.J., from which Menlo Innovations draws its name.

Sheridan's belief that an innovative company could take root here in Rust Belt Michigan - and teach others a process and methodology for innovation - appears to be succeeding even in today's troubled economy.

Menlo has 50 employees, up from around 30 two years ago, and expects to hire 25 more this year. Revenue was $2 million in 2006, rose to $2.5 million in 2007 and is running 70 percent ahead of last year's in 2008, Sheridan said.

Menlo has made investments in 13 of its clients and has received royalty checks from two of them.

One firm in which Menlo has an equity stake is Accuri Cytometers, a University of Michigan spin-off that makes flow cytometers for cell analysis, used by life science researchers.

"We use Menlo as an extension of our organization. The relationship is unique in my business experience," said Jennifer Baird, president and CEO of Accuri, which was created in 2004 and shipped its first products this year. Software developed by Menlo has made Accuri's cytometers much more affordable and easier to use than competing instruments, Baird said.

Menlo's workplace is unusual but not very complicated.

"It's kind of like kindergarten," Sheridan said.

People work in pairs, two to a PC, in an open space. Partners are changed every week, and a worker might be assigned to a different project from one week to the next.

Working in pairs helps improve accuracy as partners correct each other's mistakes. Changing partners keeps people fresh, and moving from project to project helps keep everyone at Menlo aware of what everyone else is doing.

Collaboration is central. Job applicants are interviewed and tested in pairs and are advised that they will be judged on how well they help their partner get hired.

Menlo's so-called anthropologists shadow clients, closely watching every aspect of how they do their jobs, to help design easy-to-use software and equipment. Customers, rather than ordering software and seeing a final result many months later, come in for weekly "show-and-tells" on progress.

Every weekday morning at 10, in another kindergarten-like exercise, a bell sounds at Menlo and all those present - workers, clients and visitors - gather in a circle for a stand-up meeting.

A plastic Viking helmet is passed around. Every person or pair speaks as they take the helmet. They tell the group what they're working on, what problems they could use help with and what events or meetings with new clients are coming up.

The meeting ends when the Viking helmet completes its journey around the circle, which almost always takes about 13 minutes.

"Most companies couldn't even get a meeting started in 13 minutes," Sheridan said.

About 10 percent of Menlo's revenue comes from teaching others about its culture and agile development process.

Most who come in for a daylong course are Menlo software clients, but anyone can walk in and pay $675 for the experience.

AAA Life Insurance of Livonia, Mich., doesn't buy software from Menlo, but Matt Scully, AAA's director of business and technology solutions, adopted Menlo's methods in his 75-person department last year.

The show-and-tell meetings "have engaged our business partners in marketing, finance and other AAA departments as never before. There are no surprises," Scully said.

He holds a daily stand-up meeting at 9:30 a.m., without a helmet to pass around.

"One day we used a plastic replica of the Stanley Cup," he said.

Not everything about Menlo's methods is easy to swallow. Scully said his top management at AAA bought in but that rank-and-file workers were reluctant to give up their cubicles.

"You lose privacy. You're sitting closer together. It's a challenge. We're not done yet. We're only at end of the first quarter of the game, but we're winning," Scully said.

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