and skills to the utmost. Our experience at AES showed that this kind of workplace can be the cornerstone of an organization that is vibrant and economically robust.
A joy-filled workplace gives people the freedom to use their talents and skills for the benefit of society, without being crushed or controlled by autocratic supervisors.
CHAPTER 1
My Introduction to Work
KENNY WAS A bright-eyed, smallish 2-year-old with an ugly scar and a slightly deformed face. He and his two older sisters had come to live as foster children at the Bakke home in Saxon, Washington, a few months earlier. They had been “temporarily” taken away from their parents by the county welfare department and placed in our family’s care for an indefinite period of time.
On this particular day, my mother had organized the evening work in her usual style. The kitchen was abuzz with activity. I was 16 years old and charged with cooking creamed peas for supper. My younger brother was carrying wood from the shed to the storage area next to the kitchen. Kenny’s older sisters were clearing dirty cooking dishes and setting the table with dinnerware. Mom was overseeing all of this as she swept the floor and kept an eye on the homemade ice cream being churned. No one was paying attention to Kenny, who watched the work scene in front of him while running his matchbox car back and forth across his highchair tray. Suddenly, the 2-year-old threw his car on the floor and picked up the spoon on his tray. “I want jobs, I want jobs, I want jobs,” he chanted as he pounded his spoon.
I think this little guy with a crooked smile and troubled past was saying, “I want to contribute. I can make a difference. I want to be a part of the team. I’m somebody. I want to have fun working, too!” Over the years, I have reflected on this moment and come to believe that it captures the early and substantial influence Mom had on my concept of fun in the workplace. Somehow, she created an environment in which everyone was energized, not from fear of punishment or promise of rewards but from a desire to accomplish something positive. She had unbridled confidence in our ability to accomplish the tasks at hand. I can think of few things she didn’t believe we could achieve, even at an early age. She gave us enormous freedom to work and make decisions. Somehow she made work so attractive that even an abused 2-year-old wanted desperately to pitch in for the sheer joy and excitement of it.
Like a lot of rural families with immigrant roots, we knew about work. My first regular job outside the home was as a 5-year-old when my grandfather hired me to chase the cows home to the barn each evening for milking. Looking back, I marvel at the skills I acquired while performing this job. I learned the importance of time, because I had to leave my house precisely at 5 p.m. to scour more than 180 acres of fields and woodlands and a mile of riverfront to round up the cows. I learned that they would gather in different places during rain, cold, or summer heat. I learned how to cope with darkness because it arrived at 4:30 p.m. during winter on the 49th parallel. I gained my initial understanding of stewardship—a concept that would become central to my life and that I will explain later in this book—when I was required to put 5 cents of the 50 cents a week I earned into the offering at church on Sunday. I voluntarily put the rest in my piggy bank. When the bank was full, I used the contents to buy government savings bonds.
When I was 7, I drove the tractor that lifted hay bales from the loaded wagons coming from my grandfather’s fields into the barn mow. This was exciting because of the pressure involved in stopping the tractor at precisely the right moment so that the bales would fall in the part of the barn where they were to be stacked.
For 10 years after I turned 6, I also picked strawberries for 25 to 30 consecutive days every June and July. When that season came to an end, my family and I would harvest raspberries, blueberries, and hay at local farms. In all of these endeavors, I had significant control of how fast I worked and how much time I spent on the job. I knew at the end of each day how good or bad my performance was.
The first “manufactured” goods I produced were bundles of kindling that my brother Lowell and I cut from old cedar logs. We sold them to relatives and their neighbors who lived in faraway Seattle. This experience taught me not only how to use an ax and a power saw but also how to package a product and how to price it for the marketplace.
When I was 13, my Uncle Aadne, who lived on the farm next door, gave me a young steer to raise. I sold it back to him 18 months later and used the money to start my own cattle business. Uncle Ralph from San Francisco invested over $800 in my purchase of eight Hereford heifers, the beginning of a herd that would reach 29 head of cattle by the time I left home for college. Unfortunately, this financially successful business ended abruptly when my mom phoned me at college to say that the cows had broken through the fences into the neighbors’ property “one too many times.” She had sent the entire herd to be sold at the regional auction barn.
These early work experiences were more important to my later understanding of the workplace and business than my formal schooling, including the two wonderful years I spent at Harvard Business School. In fact, I don’t recall the words “fun” and “work” being mentioned in the same breath during my time at Harvard.
Also crucial to my sense of what makes a workplace fun (or not so fun) were the six years (1970-76) I spent in the federal government—first at the Department of Health, Education, and Welfare, then in the Office of Management and Budget, and later at the newly formed Federal Energy Administration. It was during those years that I learned that having a purpose made work meaningful. I also came to understand the destructive tyranny of most central staff operations. For people who did not have the privilege of working in those central offices, the workplace was seldom rewarding or fun.
One of the most productive and exciting hours of my life was a car trip from Annapolis, Maryland, to Washington, D.C., in 1980 with Roger Sant, AES co-founder and my extraordinary business partner for over 20 years. Roger is the finest business strategist I have ever known. Without him, AES would never have come into existence or survived past the first few years. My gratitude to this remarkable person cannot be exaggerated. His great gift to me was providing the freedom to develop and implement the ideas in this book. He also graciously granted me the title of co-founder, although I was not deserving of the equal status this designation implied. Roger started the company; I helped. Few board members, even those who joined long after the company began, believed the co-founder premise. “Roger and the kids” was the way one board member put it.
We were returning from a conference where we had just decided to end the work of the Energy Productivity Center at Carnegie Mellon Institute (a research arm of Carnegie Mellon University), where I worked from 1977 to 1981. During the drive, we outlined our dream for a new company that would become Applied Energy Services, Inc. (later the AES Corporation and finally AES, The Global Power Company). As I recall, the only reference to the eventual values and principles of AES during that conversation was Roger’s comment as he dropped me off at my house: “And let’s make it fun.”
The business logic of the company was outlined in a study that grew out of the work Roger and I did at the Mellon Institute. (In 1984, the study was published as a book, Creating Abundance: The Least Cost Energy Strategy.) Our premise was that if the generation of electricity was not owned or regulated by the government, the competition among private owners would reduce prices to consumers and improve efficiencies and service. We launched the company in January 1982 with a bank loan of $60,000, which we personally guaranteed, and a million dollars from investors, including a few family members. (For a thumbnail history of the company, see Appendix A.)
A year after starting AES, Roger and I were returning from a frustrating visit in Los Angeles with the ARCO Corporation (later BP/Amoco). AES had an agreement with one of ARCO’s largest operating divisions to build and finance a new electricity-producing
