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W.L. Gore

Bill and Vieve Gore founded W. L. Gore on January 1, 158 based on the assumption that Teflon (PFTE) could be profitable as coated ribbon cable. Today W.L. Gore produces numerous PFTE derivative products such as Gore-Tex, clothing, sealants, filter bags, cartages, coatings, electronic, medical, and industrial products. What makes W.L. Gore & Associates so unique is the fact that they have never had a hierarchical titles or conventional structures. As Bill Gore, the president, states "Get big by staying small."

Bill Gore knew that products alone did not make a company. He wanted to avoid smothering the company in thick layers of formal management, thus, the lattice structure evolved. In the lattice structure interpersonal interactions, self-commitment to group know responsibilities, natural leadership, and group discipline were important factors that Bill deemed were necessary to the overall performance of the company. Direct lines of communication with no intermediary, sponsors not bosses, natural leadership, objectives set by those who must make them happen, tasks and functions organized through commitments, and no fixed or assigned authority were the key traits of the lattice structure in W.L. Gore. He felt that hierarchy stifled individual creativity and in a company based on research and development this is very important.

This structure works well for W.L. Gore because the company implemented the structure from the start, and everyone in the company works towards the same goal. They were able to achieve this through their incentives such as the associates' stock ownership program (associates own 0% of the stock!), profit sharing based on economic value added, and salary. They also kept the company small which gave associates a high degree of responsibility so that employees could be creative and productive without being held back by bureaucracy. Keeping the company small also created a "family feeling" atmosphere because everyone worked together equally and was encouraged to create value in their own way, which created job enrichment. Furthermore, W.L. Gore implemented a sponsor program based on the four principals water line, fairness, freedom, and commitment where new associates are coached and encouraged based on their strengths and weaknesses. This enabled everyone to feel important and necessary, and in turn gave them an objective that was in line with the companies overall goals and values.

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In a small company that specializes in research and development, responsiveness and coordination is key. To increase the responsiveness of the W.L. Gore team; the company reduced formalization, increased decentralization, and increase communication and information sharing. To increase coordination they implemented a high degree of socialization, communication, and leadership roles that gave guidance, commitment to success, team consensus on objectives, contribution reports for compensation, activities of employees, functional areas, and coordination on research, manufacturing, and marketing. Without increasing responsiveness and coordination within W.L. Gore, exploration, exploitation, efficiency and effectiveness would have been severely crippled.

If W.L. Gore had adopted a more traditional structure employees would have been less likely to value and drive toward the companies goals and visions. This would happen because of centralized decision-making, bureaucracy walls, the lack of communication and information sharing, and employee lack of incentive and job enrichment. Therefore, hindering the responsiveness, coordination, efficiency, effectiveness, exploration and exploitation.

For small companies that value and need employee creativity, initiative and motivation like W.L. Gore the lattice structure is by far the most effective way to hold its values, achieve its goals, and get the results desired. However, if the company were large such as GE the lattice structure would not be the best alternative - not to say that they would not value employee creativity, initiative and motivation. This is because there would be a lack of control. There would be way too many employees and duties to govern all of them and keep them in line with the companies goals and vision. A high degree of bureaucracy, more formalized and centralized traditional structure would work best in order to effectively run the company productively and efficiently, as well as service its customers. Nevertheless, if a small company such as W.L. Gore did not execute a lattice structure the performance and productivity of the company would lack because it would not effectively take advantage of its human capital, which is the most important competitive advantage that it would hold.

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