How peer coaching fosters employee proactivity and well-being within a self-managing Finnish digital engineering company

Abstract

• Peer coaching partially fills a leadership void in self-managing organizations. • Peer coaching enhances employee proactivity and well-being. • Peer coaching facilitates organizational level outcomes. • Employees’ needs are the major driving force of the peer coaching system at Nitor. • Employees’ needs are multidimensional, dynamic, and diverse. Pressure is increasing on traditional organizations to transform by moving away from old hierarchical structures towards more self-management in order to respond to nimble and agile entrepreneurial ventures and start-ups. In order for organizations to succeed in such transformations we need to know more about how radically self-managing organizations function, and what makes employees thrive and struggle in such settings. In this paper, we delve into an innovative peer coaching system used by Nitor, a self-managing digital engineering company, which challenges the mainstream belief how profitable companies should be organized and managed. In our study we explore the key characteristics of this peer coaching system, the mechanisms through which it enables employee proactivity and well-being, the key organizational outcomes and the challenges of successfully implementing it. The study suggests that peer coaching is especially helpful in self-managing firms as it is able to replace some of the key roles that middle management plays in traditional organizations.