Getting rid of hierarchies might just save the human race
Advocates for a more democratic workplace say that the key to getting employees motivated is to let them manage themselves. And Holacracy might just be the most visionary of the new methods for scrapping the boss.
According to a Gallup poll, nearly 70% of American employees feel disengaged at work. The litany of reasons is unsurprising: micromanagement, having little authority, and low pay are the primary culprits.
Most management gurus argue that our organizational structures are to blame. Corporate hierarchies have been designed for a workforce that does repetitive labor, not innovative knowledge work. Considering the need for innovation in almost every sector of the economy — especially technology — it’s strange that we still organize our companies (even startups!) with command-and-control scientific management models from over a century ago.
Despite massive advances in understanding brain science and human behavior, we still find ourselves limited by yearly performance reviews, subjected to unempowering oversight by our bosses and constrained by too-narrow job descriptions. At the minimum, the corporate hierarchy needs an update, if not a complete flattening.
As Brian Robertson explains in his new book, holacracy works by assigning particular “roles” to employees, who enjoy full authority over their domains. Instead of getting told what to do, they meet in “circles” that help to process “tensions” in the work flow. A disciplined process through which everyone is empowered to be entrepreneurial drives incremental improvement. Robertson founded a software company in the early 2000s that pioneered this system. Now his consulting company, HolacracyOne, advises other companies about how to transition to leaderless operations. Over the past several years, dozens of smaller companies — Zappos and Medium among them — have adopted holacracy with promising results.
The point isn’t that everyone in the organization is equally powerful; it’s that everyone is powerful in a way that makes the best use of their talents and skills.
Robertson says that consensus is actively shunned and the system allows workers to become self-actualized, a la Abraham Maslow. Perhaps more to the point, workers can act more quickly and flexibly to solve problems in real time, without waiting for permission from higher-ups.
To some, holacracy can be liberating, like a workplace mash-up of Burning Man and Office Space. It offers freedom from politics, bureaucratic rules, pointless meetings, silos, and infighting. Gone are the vacuous status symbols of the Mad-Men era: no fancy corner offices or reserved parking spots, no Bill Lumbergh asking employees to come in on the weekend. Idiosyncracies are appreciated, not stifled.
For millennials, holacracy aligns with the values that tend to emerge from having grown up in a digital world. It’s a generation used to shifting between self-directed work and connected collaboration. Juggling multiple “roles” in holacracy should come easily to a group that has always toggled between multiple tabs and apps. And, they don’t need promotions because they know how to self-promote.
Yet to those accustomed to competitive corporate hierarchies, the approach seems destined to fail. Without managers, who will hire, fire and promote? How will people advance in their careers if there is no upward ladder? Most people who hear about holacracy are skeptical. They say that the change is too radical, and that it only fits companies that were founded with flexible, adaptive cultures. Critics also say that the system would only work for successful companies and would fall apart the minute that revenue starts sliding.
For more radical thinkers, holacracy continues to propagate the sins of capitalism, but under a veneer of self-determination. Philosophers such as Slavoj Zizek say that despite the Internet’s ability to allow millions to self-organize and communicate without state intervention, these new systems don’t address the inequality and exploitation that lie at the root of our economic system.
But flat hierarchy advocates would respond that critics don’t fully understand the radical paradigm shift of self-organization. Holacracy is less about capitalism or anti-capitalism. Robertson’s ideas found inspiration in the biggest system of all: nature.
Complex living systems are not governed by top-down, authoritarian power concentrated in small centers. Despite what’s featured in popular Discovery Channel nature videos, most organisms are cooperative or symbiotic, not competitive.
From tiny micro-organisms to vast eco-systems and galaxies, nature distributes energy and resources in a non-linear and adaptive way. The cells in your body organize into organs, which group into systems, which all function interdependently to keep you alive and growing. And while a single nucleus governs each individual cell, no single CEO cell runs the overall system.
But more crucially, self-organization seems to align with coming technological shifts in the marketplace. Tech is embedded in everything we do — it’s helping us shop, eat and recreate. Digital, mobile and social channels connect billions in networks. It’s getting harder and harder to keep core business functions (like R&D, production and sales) separate. Any employee or customer can tweet about a company. Anyone on LinkedIn can source leads, follow up with customers, or post content. Sensors and streaming data from the Internet of Things will give any worker the same real-time access to information about goods and services. But with holacracy, employees can finally act on the data and signals they receive, rather than wait to be told what to do.
It may be too early to tell, but the future of business seems to be headed toward market networks. Sites like Honeybook, Houzz and AngelList — which combine the social graph with transactions — are starting to take off. Facebook is adding commerce to its messenger app and like Pinterest, isexperimenting with a “buy” button.
Recommendations from friends are twice as effective as ads in driving purchases, which means that we all have the power to run our own marketing campaigns. In such a scenario, might companies with distributed decision making be the most responsive and profitable? Peer-to-peer connections don’t need managers to organize and be productive, just good algorithms. When you look at the digital trends coming our way, holacratic organizations seem almost inevitable.
A holacratic shift transcends business and tech trends, though. It addresses the very human problems of motivation and self-worth. Why are so many workers disengaged? They don’t feel valued, and can’t see how their individual roles connect to the big picture. But they still stick it out, giving only a portion of their potential.
For too long, we’ve been asked to leave half of our selves at home when we go to the office. We shut off our emotions, ignore our passions and stifle nagging questions about purpose and meaning. Our workplaces don’t promote well-being.
In the future, anti-hierarchical companies won’t rely on workers acting out of duty or falling into a routine of 8-hour days in pursuit of external gratification. Paychecks and titles won’t drive performance, and neither will a boss. Employees’ intrinsic motivation — their passions, their purpose, their health and wellness — will be catalyzed by company priorities.
Holacracy ultimately carries the potential for the activities of for-profit and nonprofit firms to blur together, with the highest growth areas being physical, emotional and spiritual well-being. Eventually, self-organizing companies might even lead to a society with zero economic growth. According to Frederic Laloux, author of Reinventing Organizations, this doesn’t mean that we won’t have prosperity. We’ll just have a different definition of it.
The endless production of things in a relentless pursuit of profit comes at the expense of disadvantaged people and the planet. That is perhaps the biggest “tension” that our species needs to process. Keeping the corporate status quo will doom our limited natural resources and exacerbate climate change. Ultimately, to survive, our society will have to achieve closed-loop production, where everything is recycled, mimicking nature. Human health and happiness will take precedence over the bottom line. By re-naturalizing us, holacracy might just save us.