Holacracy: The trending new organization structure?
How does your working place look like? Isn't it just like below picture depicting?
I was surfing through the atlantic Magazine and startled with my raised eyebrows to find this article "Are Bosses necessary?". It was about the Zappos shoe retailer who was recently acquired by Amazon. Zappos have adopted the new organizational governance structure called "Halocracy"; which has, unlike traditional hierarchical structure, no titles to the workers and the management is flattened to circles (which isn't exactly flattened as misinterpreted by few sites. It is hierarchically democratic.). In a way it's good to have title less jobs, some times we engage ourselves in so many roles that our designations only will negatively impact us and our productivity. So, no titles and collapsing of hierarchy into circles that is made up of one or more roles, where a worker can take any number of roles - he can even create a role if there is a need - and start working on it.This will give more transparency.
Above all description is glittering to some of us. Rest might have started to mull over: the integration of the organization, who defines the goal?, the direction the company is going to take, the tracking of the company's progress, what if the multiple roles taken by a worker is not fulfilled?, how does it curb the corruption?, how effective is it to the conventional one? the list goes on.
Halocracy has constitution which will screen and control most of the aspects in the organization like forming, merging, or collapsing a circle; the integration of the circles to form a complete stable organization; circumscribe everyone with its rules. The plus point about the constitution is it can be amended based on the needs by the organization, unlike the conventional organization which will have most of the powers lumped in the hands of few people who may start using it for their own needs. Halocracy is complex to understand as told by zappos, who are still trying to understand it. You can never understand anything completely unless you dwell into it. This applies to all in the world. However, i am attempting to collage from different articles to give you an idea of what holacracy is.
As found in a reading, the founder of the Holacracy Brian Roberson would start his training session on it by putting the above shown picture and pose a question to audience "what are some of the challenges fond in the traditional organization? " The reply form audience would be: “painful meetings,” “difficulty to change,” “overwhelm,”
“unclear objectives,” “misalignment,” “lack of engagement,” “rigidity,”
“politics,” “analysis paralysis,” “bureaucracy,” “fear,” “communication
issues,” and so on. Yes, his intention is to say that there is a problem with the present organization's structure.
From many articles which are misleading and give misconception about Holacracy, i found one to be perspicuous. I am pasting a portion of article which explains "how does Holacracy works?"
The Holacracy Constitution
Holacracy works by first having the CEO cede all legal
authority to a new organizational Constitution. Holacracy provides a blueprint
for the Constitution that the organization can modify for its particular needs
and situation. This is where I warn you that you should not try to understand
Holacracy by reading the Constitution. That would be like trying to learn a
very complicated board game by reading the rule book. Instead, Holacracy
encourages you to attend their trainings to learn how to “play the game” and
then refer to the rule book when you have questions.
Organizational Structure
The organizational structure in Holacracy is constantly
evolving. It’s created and reinforced through a series of special meetings
called the Governance Process. The key organizing element of a Holacracy
structure is a circle that is made up of one or more organizational roles. The
highest-level circle is the General Company Circle (GCC), which consists of all
of the main roles or functions being performed in the company. For instance, an
initial GCC might consist of roles from Sales, Operations, Finance, Accounting,
Engineering, Marketing, and Product Management, as well as the former CEO role.
From the GCC, sub-circles are created for each role. For example, Sales is part
of the GCC but also has its own Sales Circle.
Governance Meeting Process
Governance is where the organizational structure is created
and evolved. Here the intent is to distribute authority and create
organizational clarity about which roles are accountable for what. Holacracy
doesn’t dictate what the structure should look like. It only stipulates how a
role should be defined in the structure and how the members of a circle can
adapt or change the roles within that circle to better serve the organization’s
purpose. Most of the practitioner training is spent learning to navigate the
nuances of the Governance meeting process. It starts out easy enough but the
more you scratch the surface, the deeper it goes. If Holacracy was a board
game, this is the stage when the players would get out the rule book (in this
case the Constitution) and start interpreting and debating the rules. (This
reminds me of Bismarck’s comment, “If you like laws and sausages, you should
never watch either one being made”).
Operations Meeting Process
Operations is how the day-to-day work of an organization is
managed. In Holacracy, the focus of Operations meetings is to synchronize
information flow and quickly triage what it calls “tensions.” A tension is a
perceived gap between what is and what could be. Any member of the circle can
bring a tension to the table and have it addressed. What’s peculiar to the
Holacracy approach is that the circle doesn’t try to find the best way solve an
issue, nor does it attempt to do so holistically by gathering data on all the
issues related to that tension. It simply tries to resolve that one particular
tension, in isolation, for that one role in the circle. This is done through a
series of rigid steps that the circle must follow before it can reach a
decision. In other words, it follows a process focusing on micro-level issue
after micro-level issue, until, theoretically, all issues are resolved…ad
infinitum.
Glass Frog Software
Glass Frog is like a corporate wiki designed
specifically for Holacracy. Glass Frog contains the organization’s
constitution, a description of all roles, and the output of all governance and
operations meetings. A Holacracy purist would argue that Glass Frog is not part
of its core operating system and that a company could deploy Holacracy without
it. I disagree. There is an overwhelming level of detail within Holacracy.
There’s no way to track and manage it without a good system in place to do so,
especially in a distributed environment.
Robertson connects Holacracy to the Operating system, wherein it only focuses on the process and bases the organization. The circles are like Apps which can be formed and dissolved to move the organization in the right direction. All these are confined by constitution which can be amended.
You can find many critics against this system pointing out the loopholes in the system. One such critics is given by the Steve Denning. He has warned not to view this as panacea to the regular organizational structure. He says passing the decisions from circle to circle down the hierarchy won't give the members of the each circle the bigger picture of the organization. He also said there is nothing which can account the voice of customers. Detailed review of his can be found here:
In response to Denning Olivier Compagne a partner of the holacracyone has written in the below link:
Here are list of companies which has deployed the Holacracy:
Sources:
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