Company rules should treat employees the way you want them to behave — like adults

“I follow three rules: Do the right thing, do the best you can, and always show people you care.” — Lou Holtz

Imagine having to read a 10-page manual before every meeting.

That’s what used to happen at GM. Its workplace dress code was complex, copious, and lengthy — 10 pages long to be exact.

Until GM’s new head of HR shrank the restrictive dress code to two words:

“Dress appropriately.”

We live in a complex, dynamic world — rules should make things simpler, not more complicated.

Unfortunately, bureaucracy is growing, not shrinking. That’s what Harvard Business Review uncovered after surveying 7,000 readers.

Organizations have become more rule-bound and conservative in the past few years, according to most respondents. Especially in the areas that create customer value — like innovation or customer service.

Dumb company rules stifle innovation, frustrate people, and slow your organization down.

Here are five ways to enable your people — use rules appropriately.

1. Keep Company Rules Simple

Align on what needs to happen. Let people figure out how.

GM’s two-word dress code is a perfect example.

When Mary Barra became VP of Global HR, she knew bureaucracy was harming the organization.

Brainstorming with her team, she came up with the new, simple rule:

“Dress appropriately”

Her team fought back — they wanted to add more specifics.

The beauty of a simple company rule is that it defines the criteria and lets people use their best judgment. You don’t need to provide examples or cover all possible alternatives.

One of the biggest pushbacks came from a senior executive. His team had to deal with government officials on short notice — they had to be dressed for the occasion.

Keep rules simple — don’t get caught up with extreme situations.

As Barra explains, “‘I talked to the team, we brainstormed, and we agreed that the four people who occasionally need to meet with government officials will keep a pair of dress pants in their locker. Problem solved.’”

GM’s were ready to dress appropriately without complicating the two-word policy.

2. Don’t Punish 97% of Your Employees

Every time I’m helping clients simplify their rules, I get the same initial reaction.

“What happens with the offenders?”

Most organizations design rules with the wrongdoers in mind — they end up punishing their best talent.

Quoting former Chaparral Steel CEO:

“they are managing for the 3 percent.”

In other words, many companies create rules to control a small number of offenders. They end up suppressing the innovation and creativity of the other 97%.

As Vera Nazarian said, “To every rule, there is an exception — and an idiot ready to demonstrate it. Don’t be the one!”

The dumbest corporate policies were designed to protect organizations. They were crafted with the 3% in mind.

For example, asking people to prove that a loved one passed on. It’s part of the 10 worst corporate policies listed by Liz Ryan. Employees must bring a death certificate copy to get paid for bereavement leave.

Etsy offers 26 weeks of fully-paid parental leave. Anyone can take it over the two years following the birth or adoption of a child.

Regardless of if they are single, adoptive, or surrogate, all parents who work at this vintage e-commerce receive equal treatment.

Design for the 97% percent — like Etsy does.

3. Company Rules Should Enable, Not Limit People

Company policies should allow your team to make their choices.

Freedom doesn’t turn people into rogue employees. The more autonomy you give, the more accountable people will become.

The command-and-control approach is not working — it probably never has.

The notion that people will do things because their bosses tell them to is a fantasy. Your team is not dumb. People will work around the system to overcome limiting rules.

Controlling people limits engagement and commitment. Employees quit when their job is no longer meaningful.

That’s why so many ‘limitless policies’ are on the rise.

Unlimited time off is not a benefit limited to progressive companies, such as Netflix or Virgin. Many traditional organizations, such as GE and Honeywell, have also followed suit.

Offering unlimited time off doesn’t mean that people won’t ever show up to work. Instead of tracking time, companies encourage performance.

Enabling company rules let people decide when they want to work hard and when to take a break.

Some people might abuse an unlimited policy. Take it easy. Address the 3% percent issue — don’t punish the other 97%.

Freedom enables people.

Be generous with your teams  — and they will be limitless.

4. Trust People and They Will Trust You Back

Control is the opposite of trust.

So many command-and-control organizations correlate trust to tenure.

The more time you spend in the company, the better benefits you get.

In many organizations, you must wait 6 to 12 months to receive certain benefits. Why wait to show your employees that you value them?

Trust is the foundation of successful relationships. At work, it starts the moment a manager hires a candidate.

Atlassian offers paid time off for employees to devote to fun, volunteering, and personal development.

But the company has taken trust to a new level.

New hires even get some benefits before their first day on the job. Atlassian provides a travel voucher for a “Holiday before you start” to all new employees.

The rule sends a clear message: the company trusts every employee, regardless of their tenure.

“You are hired, but first take a vacation.”

It’s no surprise that the software development company was named the best place to work in Australia for two years in a row.

If you want people to give their best, give them your best too. Control less, trust more — as I wrote here. 

5. Treat People like Adults — and Be Patient

Dumb company policies try to anticipate every possible scenario. They’re designed to tell people how to behave.

Enabling rules should focus on values and mindsets — let employees figure out how.

Smart policies treat people like adults — they don’t want to control them.

We all know that travel is a significant expense for most organizations. That’s why most travel policies are lengthier than GM’s original dress code.

Organizations believe that controlling people will help reduce costs.

Some are even trying to ‘steal’ frequent miles from their employees. They treat humans as resources. They forget that people invest a lot of their personal time when traveling for business.

Netflix’s travel policy treats people like adults:

“Do what’s best for Netflix.”

The entertainment company doesn’t tell employees to choose the lowest fare. Or to try to avoid an extra hotel night, as many company rules do.

Netflix lets employees choose when to spend more — or not. People are encouraged to determine what’s more beneficial for the company.

Having employees performing at their best is a much sounder financial decision than saving 10% on airfare.

If you want people to behave like adults, treat them like one.

Be patient, though. It takes time to shift from being a helicopter boss to a trusting one. Some people might abuse their new gained freedom.

Give people time to adjust. Wait and see before you rush into making amendments or trying to add more specifics.

Treat people like adults and they will make smarter choices than when limited by dumb rules.

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Rules should enable people, not limit them.

Design simpler, trustworthy, more adult rules for 97% of your people — not the offenders

Stop creating dumb rules — unless you want to turn smart employees into dumb ones.