I Learned This Practical Approach to Management Over 20 Years Ago — and I Still Use It Today. Here's How You Can Use It, Too.

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Workplaces are experiencing alignment challenges. I’ve seen this across organizations, in virtually every industry and at varying levels. As businesses become more complex, the disconnect between upper and middle management increases.

I’ve found success in enacting a “federal vs. state” approach to work policy. In this model, corporate (or federal) policies are outlined and teams or departments have the flexibility to adapt to those policies based on their unique needs. These policies help empower our leaders to make decisions that support their goals while positively impacting the employee experience through autonomy and trust.

I originally learned the “federal vs. state” concept from a friend who helped run the 2002 Salt Lake City Winter Olympics. At the time, I was a young manager in my first operations role, and my first task was creating a structure for operating the business. The biggest challenge was creating clarity on what needed to be done and who was responsible for overseeing it.

Here are some ideas for how to best bring that important balance to any workplace.

Creating a ‘federal’ standard gives overall direction and purpose to the company

Establishing a clear-guiding mission and vision for the company will provide the right direction for your federal-level initiatives. This step is critical. Turning this key puts the foundational elements of your mission to work, after which everything else will fall into place.

Once your mission and vision are in place, rely on them to make overarching decisions on how policies are enacted.

A recent example of this at BambooHR was managing the internal use of AI across the company. We created federal AI principles and rules around usage and ethics for AI and its associated technologies, so employees understand the ground rules.

Our decisions around total rewards are another example — we have a rewards philosophy that provides guidelines regarding benefits, incentives and base pay that are company-wide.

Ultimately, determining the federal elements of your business means ensuring your mission, vision and values are reflected in your corporate policies and business goals. It’s also essential everyone has visibility into those policies and knows what direction the company is taking.

Outlining your ‘state’ initiatives can smooth over potential internal tensions

With the company’s federal foundation established, we have clear parameters to get more granular and personalized at the state or team level. Being prescriptive about smaller-scale decisions helps ensure those customizations still align with core company principles. Clear boundaries also reduce decision fatigue by establishing which choices can be made at the state level versus which need federal approval. At BambooHR, we do this in several ways:

After we created our federal-level AI policies, teams were empowered to determine their state-level direction. This means that teams — and even individuals in various roles — can decide within company guidelines which AI tools to use and how to apply them.
Our federal compensation decisions set the standard for pay. Then, on the state level, division leaders build on those guidelines and create financial incentives for team members. Bonuses and profit sharing, for example, are handled differently in our revenue organization.
While BambooHR’s company policy supports in-office, hybrid and remote work, teams can decide which days and how often to plan in-person meetings, as well as have the autonomy to support individual work accommodation requests.
Across the business, employees up for promotion must demonstrate a commitment to and understanding of our company’s mission and contribution to company goals. Then department leadership can identify the skills and criteria needed for their teams beyond that.

My friend from the Salt Lake Olympic Committee taught me it was essential to understand that every job is important, both to the company and to the employee. Each job was included in that vision, down to understanding how the parking lot attendant connects to the mission of the organization.

When our jobs and areas of influence are clearly defined and connected to our mission, we see much less potential for tension across the organization. Efforts are often less siloed, as well, because people are empowered by state-level permissions and understand the interconnected value of their work.

Clarifying ‘federal vs. state’ lines can build stronger cultures

At the end of the day, outlining the overarching federal and state elements of your company and connecting people to your mission avoids a lot of confusion around responsibilities.

It’s not uncommon for employees to not understand why they have been asked to complete a specific work task. Not knowing the purpose or value of the effort they are putting forth is frustrating to the employee, detrimental to the quality of the work and negatively impacts the employee experience.

It’s not just front-line employees who benefit, as connecting with the mission empowers managers, too. When leaders at any level can see opportunities but aren’t empowered to move toward positive outcomes, they lose hope.

“I have to deliver but I’m not empowered to do anything” is a common refrain — and it kills company cultures. Everyone at work wants to have an impact. Managers, in particular, want to show up and be great, not spend time trying to understand who is supposed to do what.

Outlining the levels of autonomy empowers managers to run their divisions in the best way possible, and provides the framework for every employee to make decisions that spur creativity and boost morale.

Identifying your federal structure and empowering managers and employees to make state decisions will ultimately benefit your culture, your workplace engagement and your business results.

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