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By Travis Marsh

Considering alternative organizational systems

Our world is changing more rapidly than ever, and both individuals and organizations need to find new ways to adapt and thrive. In this context, the rigidity of hierarchical systems usually fails to present opportunities for growth, fulfillment, transformation, or adaptability to expanding markets. Self-management models offer a solution. These organizational paradigms aim to build a more collaborative, empowering, and malleable system and leverage the talent of diverse groups of people. But if we are not careful, adopting these systems might lead us to recreate the same problems we face with traditional models.

Replacing hierarchies with circular organizational structures is not a novel idea. Frameworks like sociocracy have been around as a form of participatory governance since 1851, and it has been modified and implemented by different types of organizations from the ’70s to this day. The Teal paradigm was presented by Frederic Laloux in 2014 to enable people to feel whole instead of being limited by their “professional persona” and to allow organizations to achieve their evolutionary purpose. And companies have been experimenting with Holacracy, a “circle of circles,” and all of its variations since 2007.

Holacracy primer

Let’s focus on this last framework, one that has sparked the most excitement among leaders, teams, small businesses, and even multinational corporations in recent years, especially in the US. Developed by Brian Robertson, Holacracy—with a capital H—builds on many of the concepts of sociocracy, like the creation of circles or semi-autonomous teams, and integrates them with the notion of roles to delimit work and decision-making domains. In simple words, companies that use Holacracy can group people based on their skills, expertise, and synergy and give them the freedom to make decisions on the spot to avoid bottlenecks, like having to wait for approval from supervisors or upper management. As part of a larger circle, these circles interact with each other depending on their current needs and can be rearranged to correct processes, ease tensions between team members, or provide a fresh perspective on a specific project. One individual can also have several roles belonging to different circles.

But the fact that teams can make decisions regarding their own work does not mean that they are hermetic and their members don’t communicate with others within the organization. In Holacracy, communication is key. First off, a team must define the roles of each of their members to have a clear view of the extent of their responsibilities, and a secretary documents their approaches and methodologies to see what works and what doesn’t. All the metrics and relevant information are then shared in regular Tactical Meetings to offer transparency and hold everyone accountable.

Other notions introduced by Robertson’s organizational model are the predominance of consent over consensus and safe-to-try experiments. Holacracy understands that getting everyone on board with an idea or decision takes time, and sometimes it might be impossible. Getting people to consent to new practices, on the other hand, opens up the door for experimentation and discoveries that may improve the team and the organization. That approach allows both individuals and circles to use their whole creative potential and course-correct when necessary.

The problem with Holacracy

All right, so all of that makes Holacracy and other circular models sound like the ideal way to organize companies, and many CEOs and managers will argue that they definitely are. But if they are so perfect, how is it that many companies still struggle to make it work? Well, the answer to this might be as complex as human nature itself.

Some people fear that it might lead companies to a “flat and homogeneous state,” where there are no such things as promotions, everyone has the same power, and they are all forced to think alike. Others think of Holacracy as a one-size-fits-all type of framework that can easily be applied to all kinds of organizations with outstanding results. Both of these postures are equally wrong. Learning that Holacracy, sociocracy, Teal, Podularity, and other decentralized paradigms are just as structured and mission-oriented as centralized models is fundamental to using them correctly. The other key factor is understanding that we are not dealing with figures or machines but with a whole ecosystem of human beings and their idiosyncrasies, cultures, beliefs, and social dynamics.

So depending on their skills, experience with decision-making and peer tensions, ambitions, and even technical knowledge on organizational structures, individuals will have varying degrees of ability to embrace these models. People in senior-level positions tend to feel more comfortable making decisions, while those coming from the bottom of a hierarchy usually feel insecure when it comes to having autonomy.

Holacracy and self-organization will not work unless we, as leaders, understand that they are not rigid structures that we should impose on our teams but rather a foundation to build more equitable, just, diverse, and efficient organizations. So our goal should be to find the balance between encouraging individualism and inspiring people to achieve a collective purpose.

To get a broader perspective on a fascinating issue like reimagining organizations, collaboration, and leadership, reach out to us. We can help you customize these concepts for your company.

Here’s a list of resources that could help you on your journey:


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