Dee Hock

Failure is not to be feared. It is from failure that most growth comes; provided that one can recognize it, admit it, learn from it, rise about it, and try again. 

Dee Hock

Given the right circumstances, from no more than dreams, determination, and the liberty to try, quite ordinary people consistently do extraordinary things.

Dee Hock

We are at that very point in time when a 400-year-old age is dying and another is struggling to be born – a shifting of culture, science, society, and institutions enormously greater than the world has ever experienced,” he said. “Ahead, the possibility of the regeneration of individuality, liberty, community, and ethics such as the world has never known, and a harmony with nature, with one another, and with the divine intelligence such as the world has never dreamed. 

Dee Hock

I left VISA in 1984 because I had proved everything I had set out to prove about the effectiveness of these concepts of organization. When VISA became so extraordinarily successful, I thought the world would beat a path to our door to explore the concepts, but it largely ignored us.

Dee Hock

A true purpose always has ethical and moral content, which can be either implicit or explicit. It is a statement to which all members of the community can say with the wholeness of mind, body and spirit. If we (notice the plural) could achieve that, then my (notice the singular) life would have meaning.’ By that test, does making next quarter’s profit give my life meaning? It may be a necessity, it may be desirable, it may be beneficial in some way, but it’s not a purpose. It’s a relatively meaningless objective or goal.

Dee Hock

Money motivates neither the best people, nor the best in people. It can move the body and influence the mind, but it cannot touch the heart or move the spirit; that is reserved for belief, principle, and morality. As Napoleon observed, “No amount of money will induce someone to lay down their life, but they will gladly do so for a bit of yellow ribbon.”

Dee Hock

Through the years, I have greatly feared and sought to keep at bay the four beasts that inevitably devour their keeper – Ego, Envy, Avarice, and Ambition. In 1984, I severed all connections with business for a life of isolation and anonymity, convinced I was making a great bargain by trading money for time, position for liberty, and ego for contentment – that the beasts were securely caged.

Dee Hock

At the time, I was the assistant vice president of a modest bank in Seattle, Washington; one of the first six banks licensed by BofA in 1966. By 1968, I was extremely concerned that the industry may go under and our bank’s investment with it.

Dee Hock

I was attending a meeting of all of the licensees of BofA which soon became a shambles of argument and accusation. The BofA were desperate to know what to do. They proposed that seven people from licensee banks, of which I was one, form a committee to look into a couple of the more pressing operating problems and propose solutions.

Dee Hock

I suggested that the committee should look into some sensible way of organizing the whole of the licensee structure to examine all the problems and propose methods to get a grip on them. It’s not an uncommon story. A naive young nobody, 38 years old, stands up in a confused meeting and makes a suggestion. In desperation, the licensees, knowing it won’t cost or commit them to anything, say, ‘fine, let’s do it, but it’s your idea so you’re the chairman of the committee.’ I just walked into a set of circumstances that was a marketing success and an operating disaster with no intent but to do a bit of civic duty.

Dee Hock

Members are free to create, price, market, and service their own products under the VISA name.

Dee Hock

I had spent about 16 years in various management positions in the consumer finance industry, but my first love was literature and philosophy, not business,” recalls Hock. “I was struck by how dysfunctional most business organizations really were, how they crushed the human spirit and how often people were in severe conflict with the organizations of which they were part… The new challenge was to determine the organizational principles of a societal organization that would emulate the principles that nature seemed to use.

Dee Hock

Never hire or promote in your own image. It is foolish to replicate your strength. It is idiotic to replicate your weakness. It is essential to employ, trust, and reward those whose perspective, ability, and judgment are radically different from yours. It is also rare, for it requires uncommon humility, tolerance and wisdom.

Dee Hock

Hire and promote first on the basis of integrity; second, motivation; third, capacity; fourth, understanding; fifth, knowledge; and last and least, experience. Without integrity, motivation is dangerous; without motivation, capacity is impotent; without capacity, understanding is limited; without understanding, knowledge is meaningless; without knowledge, experience is blind. Experience is easy to provide and quickly put to good use by people with all the other qualities.

Dee Hock

If you don’t understand that you work for your mislabelled “subordinates,” then you know nothing of leadership. You know only tyranny. Compelled behaviour is the essence of tyranny. Induced behaviour is the essence of leadership. Both may have the same objective, but one tends to evil, the other to good. Lead yourself, lead your superiors, lead your peers, employ good people, and free them to do the same. All else is trivia.

Dee Hock

Here is the very heart and soul of the matter. If you look to lead, invest at least 40 percent of your time managing yourself – your ethics, character, principles, purpose, motivation, and conduct. Invest at least 30 percent managing those with authority over you, and 15 percent managing your peers. Use the remainder to induce those you “work for” to understand and practice the theory.

Dee Hock

The obvious question always erupts. How do you manage superiors – bosses, regulators, associates, customers? The answer is equally obvious. You cannot. But can you understand them? Can you persuade them? Can you motivate them? Can you disturb them, influence them, forgive them? Can you set them an example? Eventually the proper word will emerge. Can you lead them?

Dee Hock

Think back to the best boss you ever had and the worst boss you ever had. Make a list of all things done to you that you abhorred. Don’t do them to others, ever. Make another list of things done for you that you loved. Do them for others, always.

Dee Hock

People are not things to be manipulated, labelled, boxed, bought and sold. Above all else, they are not human resource. They are entire human beings, containing the whole of the evolving universe, limitless until we start limiting them. We must examine the concept of leading and following with new eyes. We must examine the concept of superior and subordinate with increasing skepticism. We must examine the concept of management and labour with new beliefs. And we must examine the nature of organizations that demand such distinctions with an entirely different consciousness.

Dee Hock

The problem is never how to get new, innovative thoughts into your mind, but how to get old ones out. Every mind is a room packed with archaic furniture. You must get the old furniture of what you know, think, and believe out before anything new can get in. Make an empty space in any corner of your mind, and creativity will instantly fill it.

Dee Hock

The better an organization is, the less obvious it is. In VISA, we tried to create an invisible organization and keep it that way. It’s the results, not the structure or management that should be apparent.

Dee Hock

Principally, a chaordic organization is a self-organizing and self-evolving entity, which ends up looking more like a neural network (like the Internet) than a hierarchically-organized bureaucracy in which decision-making power is centralized at the top and trickles down through a series of well-regulated departments and managers. Chaordic organizations do not fear change or innovation. They are, by their very nature, supremely adaptive. They also tend to be inclusive, multicentric, and distributive and, ultimately, strongly cohesive due to their unshakable focus on common purpose and core principles.

Dee Hock

To add to the definition a little more, chaordic simply describes the behavior of any self-governing organism or system that harmoniously blends what were previously conceived to be opposites, such as chaos and order or cooperation and competition. But most importantly, this is a way of thinking. And in fact, everything I could say about it, you already know. It’s already there because you are chaordically organized. It’s the way nature has been organizing things since the beginning of time, including you – your brain, your immune system – and every living thing. So in terms of a chaordic commercial, political, or social organization, the question becomes: Can you evoke it, or bring it into being?

Dee Hock

It’s not unlike the cells in your body. Every cell in your body competes for every atom of nutrient and oxygen you swallow and at the same time is interconnected so it can recognize where there is a greater demand on any other cells and voluntarily release its demand for the good of the whole. That is the essence of VISA. It started as 200 owner-member banks and 2 or 3 billion dollars in sales, and thirty years later its volume will be a trillion eight hundred billion dollars. It is cooperatively owned by 20 thousand banks in 240 countries and territories serving over a billion consumers. And its electronic systems clear more financial transactions in a week than the entire US federal reserve system does in a year.

Dee Hock

Ownership is in the form of irrevocable rights of participation, which the banks can’t sell. They can sell their portfolio, but not their membership, and therefore no one can raid it, trade it, buy it or sell it. It’s invulnerable because it has no stock. Over the years, the core of the organization has developed all sorts of services it sells outside the membership so it can become a source of revenue rather than of taxation. It has a venture capital firm; does most of the automated clearing house clearings; and has a host of other entities. So it’s a very fractal system.

Dee Hock

It was so different, people couldn’t quite understand it. There was no stock, so it didn’t fit the normal business model. I decided I wanted to return to nature and seclusion and try to develop these ideas further, so I bought 200 acres of ravaged land in a tiny, isolated community on the coast of California, built a house with a library of four or five thousand books, and spent ten years in manual labour restoring the land to health and beauty and studying incessantly trying to develop these ideas. I wanted to see if they were applicable to other organizations and industries, or merely unique to banking and credit cards. I had no intent to do other than just develop my own thinking along these lines, maybe one day do a little writing.

Dee Hock

Without principles, a purpose is dangerous, for it confuses ends with means. The best purpose on earth achieved through destructive means is meaningless. And so you have to ask: What is the belief system in the community about where power is to be vested, how deliberations will be conducted and decisions made, how benefits are to be distributed and what ethical standards will apply to all activities? In other terms, what are the deepest, almost sacred beliefs people share about how they will conduct themselves in pursuit of purpose?

Dee Hock

The primary principle in monetized corporations is that whoever has money and can buy shares takes everything they can get and all other parties are given as little as possible. That prostitutes the meaning of capital by restricting it to money. It ignores natural capital–that is the value of what the earth produces for us at no cost. It ignores the value of community, and that is a form of capital. It ignores intellectual capital–that is the intrinsic ability and intelligence of people. It ignores every form of capital that is not reducible to the mathematics of money. Money is just alphanumeric data–a means of measurement. It has no intrinsic value.

Dee Hock

One was that participation and ownership should be open to all relevant and affected parties. A rain forest doesn’t choose which seed will sprout. They’re all eligible to belong.

Dee Hock

There is no dominant part of nature. No organ in your body dominates any other. Get rid of your liver and your brain dies just as certainly as your liver will without the brain.

Dee Hock

The whole thing soon exploded. It released human ingenuity and human imagination and linked people of every culture and language, every political persuasion, every conceivable currency, into a cooperative network in which the owner-members, the banks, engage in the most fierce competition, while at the same time engaging in intense cooperation in elements essential to existence of the whole.

Dee Hock

If you examined it, it would look very much like the organs in a body, then the cells within the organs and the nucleus within the cells. In three decades these organizational concepts took the enterprise from a hemorraging industry on the verge of collapes to what is now arguably the largest commercial enterprise on earth, and the largest single block of consumer purchasing power on the globe.

Dee Hock