Holacracy is a practice. A way of working. And it is a complete system to organize work. The system contains all the rules and processes that ensure fair decision-making. In Holacracy the purpose – the goal of the organization – is the boss and not the CEO or a manager.
Worldwide, Holacracy is becoming better known. Successful companies such as Zappos work with Holacracy. In the Netherlands, for example, Springest, Voys, SnappCar, Coopr and Concept7.
What is Holacracy®?
Holacracy is a complete and ready-to-use set of rules that can be used to shape the practice of self-organization.
The game ruleset applies to everyone in the same way. Nobody in the organization is ‘above’ or ‘outside’ these rules.
The rules provide the organization with the social technology that allows every idea that something can or should be better in the organization to be processed quickly, safely and reliably in a step forward. Anyone can introduce such an idea.
Holacracy does not provide the organizational form, but offers the tools to form the organizational structure. This makes the ‘source code’ (let’s say the organization chart, or broader: the governance) of the organizational form ‘open-source’, which means that everyone within the organization can develop it with the tools.
Organize around purpose
The self-organization is focused on a common goal – the purpose – that often ignores only the well-being (e.g. profit) of the organization. The organization hereby recognizes that it is part of a larger whole and the responsibility that goes with it.
Power and decisions
The conventional (power) hierarchy has been replaced by distributed authority. Organizational components are clustered and organized into a natural hierarchy of purpose (from ‘structure follows function’ to ‘structure follows purpose’).
All organizational units are autonomous and have all the powers associated with their responsibilities. Requests for permission belong to the past, anything that is not explicitly prohibited is allowed – until other agreements are made about it.
Agile organizational development
The organization is dynamic, changes continuously and develops in an agile manner. Top-down prediction and control makes way for being attentive and experimenting. Step by step, the organization reaches more ‘fit for purpose’ in a world full of change and disruption.
Transparency is required for dynamic management. Information and feedback is freely available as much as possible, so that the organization can learn and continue to develop.
How to practice Holacracy
You learn the practice of Holacracy by playing the game. Work with an expert for skilled guidance. A coach knows the game and the frameworks. You can not learn a sport, such as football, from a book. It works the same with Holacracy.
The existing organizational structure and agreements will not be described fully, but just enough, in a starting structure with autonomous roles and circles. From that moment on we will play ‘the game’. The organization (and therefore the circles and roles) constantly evolve based on tensions. A tension is the difference between how something is now and how it could be. In this way, the organization adapts step by step from the start.
What kind of change will Holacracy bring to your organization?
There are four differences between a traditional hierarchical structure and a holacratic organization that are most striking.
- No more functions: from functions to roles
- No more boss: from delegated authority to distributed authority
- Agile: no longer major re-organizations, but evolve step by step quickly
- Clarity about responsibilities: no more politics based on implicit expectations but clear and visible rules
Why do organizations choose self-organization based on Holacracy?
Holacracy creates more space for work happiness, innovation and quick scaling up.
Ready to go
Organizing ‘Teal’ style is aimed at wholeness, self-control / autonomy, and evolutionary purpose.
If a transformation to this new way of organizing seems attractive, Holacracy provides a ready-made answer to what that new organization looks like. Compare it to a make or buy decision for the software that the company uses. You can choose to invent the self-management method yourself and develop it internally, or you can buy the tools . In our view, Holacracy is the most complete answer with which an organization can get to work quickly with the right guidance.
Engagement and motivation
The degree of active involvement (engagement) and motivation of employees in organizations is alarmingly low worldwide (Gallup). Daniel H. Pink (author: Drive) described what motivates people in their work: autonomy, mastery and meaning.
Holacracy offers all these aspects. It is aimed at as much autonomy as possible through the principle of distributed authority. It gives people the chance to become really good at work, or to develop mastery in roles. Instead of a situation where employees who function well in their current job, receive promotion on promotion until this leads to incompetence (Peter principle).
Meaning – or ‘purpose’ – is ingrained in Holacracy at all levels. For every role, every circle, the entire organization has been made explicit what the contribution is to the larger whole. People can find the roles whose purpose resonates and is in line with their own.
As an organization grows, bureaucracy in the organization almost automatically increases and the innovative capacity per capita decreases. Is that a ‘bug’ of the system or is it an inherent feature that goes with the conventional way of organizing. Holacracy helps scale without this automaticity. Just as a city can also grow without each inhabitant suddenly being less self-reliant.
Agile and open
The industrial revolution has brought us a lot of good, but is now stuck in many areas. At this moment we are living at a tipping point in history. More ‘business as usual’ is no longer desirable or possible in almost any sector. Think of the energy sector, food production, health care, education, the financial sector, mobility, and so on. Old ways no longer work and become even destructive if they remain unchanged. The old one is crumbling, while the new one is not quite there yet.
It unfolds. The outside world is rapidly changing, uncertain, complex and ambiguous (VUCA world). We will have to organize ourselves to be agile and to be open to what wants to emerge, instead of sticking to the old. No longer predicting and controlling, but quickly integrating every new perspective, that is what the Holacratic tools help with.
Agile, robust, resilient, all are attractive features for an organization. Holacracy gives the organization the extra opportunity to be anti-fragile. This means that it learns, and develops from everything that it has to deal with. No managers or heroic types who, like a ‘thief’, deprive the organization of the opportunity to profit and learn from challenges and opportunities. Instead, the members of the organization discuss and decide which ongoing appointment can be made so that the organization can deal with the same phenomenon independently.
Holacracy helps remember how important governance is and how an organisation needs to evolve over time as it goes through different stages of its own growth. Clarity on roles, meeting structures that simplify and integrative decision making mechanisms are helpful tools for today’s organisation – and essential for today’s entrepreneurs.
We have been practicing 'different' organizing frameworks for a few years now and Holacracy is the only model in which responsibilities are really divided and properly recorded. It makes an organization flexible and scalable and makes work more fun and more meaningful for everyone.
Pro6managers started practicing Holacracy in Oct. 2015. Koen Bunders taught us the rules of the game. He also taught us not to only play by the rules but also honor the principles. You need an experienced coach to move from 'how it should be done' to 'how you want it to be done'.
Ikbenfrits is currently undertaking a journey of discovery into self-management. Coach Koen Bunders from Energized.org supports them in a pleasant way, which for me is characterized by an open attitude and a nice way of dealing with feedback. What amazed me is that this way of self-management - with Holacracy - is strongly regulated with fixed patterns for consultation. Now I'm evolving a better understanding of the 'why' and the benefits of this practice. It takes more time, that is now a disadvantage. But I see a lot of enthusiasm.
It makes me really proud to see talents appear by practicing Holacracy.
Video about the why of Holacracy
You want entrepreneurship in the office, clarity about who does what, decisions being made quickly and an organizational structure that can change just as quickly and easily as the environment. In this video you see creator of Holacracy Brian Robertson, a number of our customers and our coaches talk about Holacracy.
What kind of organizations practice Holacracy?
Holacracy is a tool for organizations. We do not see that it specifically works or does not work for certain branches. It is for that matter to be used in every type of organization.
Holacracy in a (part of) organizations
Holacracy (with all aspects that go with it) can be applied perfectly in a part of an organization and possibly grow from there (as Energized.org did at bol.com for example).
Starting a Holacracy within a part of the organization is possible as the chosen organizational unit is:
- reasonably autonomous
- has an own intention
- has permission to organize itself`
This is a great starting point or place to start with Holacracy.
When can you start Holacracy?
The journey towards self-organization (with elements of Holacracy) can be started at any time with the support of Energized.org.
You can only call the practice ‘Holacracy’ when the former director or top manager transfers his authority to the Holacracy process (by signing the Holacracy Constitution).
This is an important and especially a symbolic moment. The holders of the formal authority say: “We no longer determine. We will distribute our authority and any decision taken from this moment on with the Holacratic tool is valid as if it were taken by ourselves. ”
Fortunately, there is ample time to make the transformation. Old habits are replaced step by step with new ones. Former managers learn to let go, and former subordinates learn to develop ownership and leadership. In about 6 months, an average team learns to use the new tool independently. After that it can continue to develop for years to embody the new way of thinking and doing more and more.
Holacracy is for pioneers who are attracted to (the journey to) self-organization and where the sedentary management team and owners believe it is possible that the people within the organization (eventually) can work with the right tools themselves. Whoever does not think that last for whatever reason, should not start it.
It also helps if the pioneers can deal with (liberating) frameworks, discipline and structure, be willing to learn a lot and desire for ownership and entrepreneurship in the workplace.
Pioneers talking Holacracy: our clients
The first organization in the Netherlands that embraced Holacracy was Springest. Since then we have accompanied more than 50 organizations with their first steps towards self-organization. We have recorded many of these experiences in our blog.
It had to be different. Holacracy is dynamic and adaptable.
Talents of people become visible with Holacracy. That makes me extremely proud.
With the description of roles, everyone’s responsibility is recorded. Such roles can go as far as ‘decorating the Christmas tree’ or ‘conducting job interviews’, it is at least clear what work needs to be done by whom.
What Holacracy experiences do practitioners have?
Ask experienced practitioners how they experience self-organization and Holacracy during a Meetup or ask ourselves. We like to share personal experiences.