How The Wanderlust Group Increased Its Profits By Switching To A Four-Day Workweek
The Org spoke with The Wanderlust Group's CEO Mike Melillo to learn more about his approach to organizational design and how moving to a four-day workweek led to one of the most productive periods in his company's history.
The Wanderlust Group builds technology that encourages people to ditch their devices and connect with nature. In 2014, the startup modernized the leisure boating and marina industry by creating a seamless reservation platform, Dockwa, which connects boaters to marinas in real time. TWG also runs marinas.com, a directory and review site, and MarinaX, a data company. Since its launch, TWG has expanded to more than 30 countries, 15,000 destinations, and 300,000 users worldwide. Last October, they managed to close $14.2 million in Series B funding.
In May of 2020, TWG’s CEO and co-founder Mike Melillo introduced a four-day workweek. Not only did employee morale go up, but they saw a 121% year-over-year increase in profits.
The Org spoke with Melillo to learn more about his approach to organizational design, how moving to a four-day workweek led to one of the most productive periods in the company's history, and how his experience as a Major League Baseball player influences his leadership style. Read on for excerpts from our conversation.
What organizational structure does TWG use?
Our team is just over forty people. We have a leadership team that reports to the CEO and contains engineering, marketing, sales, customer success, operations, and business development. We’re also largely centralized, with one marketing, sales, and success team supporting all product lines. The benefits to this are fewer silos of information, less duplication of efforts, and a cleaner prioritization of projects. On the down side, you do lose some of the benefits and speed of vertical focus, so we’re evolving a bit here. On the product side, we’re progressing from a fully centralized team to product-engineer-design pods separated by customer groups. Since we’re a two-sided marketplace, we’ll have a boater pod and a marina pod, as well as a platform pod that builds the infrastructure for both.
How does being a remote-first company play into this structure and strategy?
The biggest thing we try to solve for is clarity of decision making and lesson-sharing. When a team isn’t physically near each other, more intention is required. We achieve that, in part, through asynchronous information sharing in emails and on the Wiki. I send a weekly CEO letter to the company about how we’re doing. Everyone on the leadership team also sends in a weekly update on their progress, and anything they need unblocked.
Can you talk about how adopting a four-day workweek impacted your organizational design?
In May of 2020, we introduced a four-day work week to give employees time to invest in themselves, their family, and friends, while spending more time outdoors connecting with nature—a big part of our company vision. What followed was one of the most productive periods in our company history. After the policy went into place, not only did employee morale go up, but we saw a 121% year-over-year increase in profits. There are obviously a lot of factors that went into that, but the point is: Shortening the work week by 20% didn’t hurt us at all in productivity.
Were you surprised by anything after implementing this change?
We found that even as a small company, we were spending too much time in meetings. By creating a smaller window of opportunity to book meetings, folks had to prioritize differently. Our standing rule with recurring meetings is that if the team collectively can satisfy the objectives of the meeting with an email or a written update, they don’t meet. Simple as that.
How did the four-day workweek affect TWG’s company culture?
Shifting to a four-day workweek was one influential choice, but choosing Mondays for that additional day off ended up being even more significant. By killing Mondays instead of Fridays, we allowed everyone to breathe a bit longer on the weekends, and clear their heads on Monday before heading into the work week. When you start the work week with a bunch of meetings without giving yourself a buffer period to organize your thoughts, you always end up feeling behind. Having Monday as a buffer day between the weekend and work week has done wonders for how organized we are in a given week.
Last October, TWG closed $14.2 million in Series B funding. Do you believe transforming a company’s organizational design is a necessary step when scaling a team?
Definitely. Companies go through different stages, and if the organizational structure and practices don’t evolve along with that, you’ll be less equipped to meet the unique needs and opportunities of that stage. But I don’t think you have to balloon into a 500-person company to do this. If you make changes to how you organize and operate, you can remain lean. In my past life, I was a catcher in the Milwaukee Brewers organization. I always catered towards calling a game based on a pitcher’s strengths, not a hitter’s weaknesses. I want conviction. The same goes for business. You need to be okay with constantly pressure testing your assumptions and data points in an effort to find the best possible design for you and your team.
What have you learned from your attempts to reimagine TWG’s organizational design?
Incentives are hard. It’s worth spending ten times the calories thinking through the order implications of your design before implementing changes. You won’t have a perfect answer, but you will have a more prepared response to future challenges. I think after you make a change as a company, you must be prepared to constantly remind the team not to be held back by what once held them back. There’s a psychological and cultural shift after the very practical one that takes longer.
How ambitious is TWG in terms of its organizational design?
I think fundamentally the question must be: What’s standing in your way? Is it a structural blocker or a strategic one? Is there a policy holding your team back, or a person? Diagnosing where the friction comes from is the main thing. After that, the action needed becomes clear. And when it is, you move without hesitation. We’re still a relatively small team overall, so we’re focused on partnerships and cross-functional initiatives between product, design, customer success, operations, and marketing to help drive growth.
TWG is in the unique position of being a tech company that actively encourages people to get offline and experience the world. How does this mission factor into your strategy for growth?
We love technology. But we want to put it back in its rightful place as a powerful conduit for experiences, not the experience itself. We want our technology to feel almost invisible, so we don’t create a bunch of hook models to keep people in the product itself. We want people to come back because it’s the fastest way to get out on the water if you’re a boater, and out of the office if you’re a marina operator. I think that’s partially why we’re organizing our product teams around people, rather than product lines.
Last year, Americans flooded marinas, campsites, and national parks due to limitations on international travel. What are your predictions for this year's outdoor adventure season?
2020 created an outdoor recreational boom the country has not seen in some time. U.S. boat sales reached a 13-year high in 2020, and we’re seeing that translate into major increases in reservations at our marinas this year. In Q1, we saw a 73% year-over-year increase in boaters making reservations and a 182% year-over-year increase in the number of nights booked. We released a new feature this year to help marinas spot openings in their docks and make more efficient slip assignments. We’re also introducing features to make the end-to-end boater experience better, make arrivals easier, and enable boaters to save and share their favorite routes. We’re excited for the great boater boom to grow.
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