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The bossless company: can Holacracy work?

The bossless company: can Holacracy work?
September 19, 2018 John

Holacracy is the relatively new workplace organisational structure which has been all the rage amongst Silicon Valley. Based on ideas of equal power distribution and self-managed teams, Holacracy is the brainchild of entrepreneur Brian Robertson.

Distributed through HolacracyOne, Holacracy came to fame in 2014 when American online shoe retailer Zappos announced their entire 1500 person strong company would be switching over to the Holacracy organising model. But can it work?

How does Holacracy work?

Holacracy is a decentralised form of workplace organisation, intended to replace the traditional workplace hierarchies. In a Holacracy, individuals form into small, self-managing circles which work alongside, and on top of, other work circles. Holacracy replaces jobs with “roles”, and links between circles act as nominal managers.

Benefits of Holacracy – ‘the ayes’

One of the most praised aspects of Holacracy is the effect it has on meetings. In a Holacracy, workers organise their meetings around a clear, facilitated purpose. Instead of the usual interruptions and back-and-forth in a meeting, Holacracy rules put forward a facilitator that ensures no one speaks out of place or talks over other individuals. Individuals who are usually reserved are encouraged to contribute.

In a Holacracy, all actions have to have a clearly defined purpose. Not only are the tasks of each worker supposed to have a clear meaning, but all meetings and workplace interactions need to work towards the organisation’s goals, such as profitable business growth. As each person has a clear role and area of expertise, you would know who to see to fix a problem. In this way, Holacracy provides a workplace clear order and purpose to get things done and work towards the organisation’s goals.

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Disadvantages of Holacracy – ‘the nays’

While several organisations have claimed that adopting a Holacracy has revolutionised their workplace, in 2016 the online publishing platform Medium dropped their Holacracy. In a blog post, Medium manager Andy Doyle claimed that the Holacracy system caused Medium workers to lose their sense of ownership of their work and that “it was difficult to coordinate efforts at scale…For us, Holacracy was getting in the way of work”.

Also in 2016, Zappos, the company who so publicly embraced Holacracy two years earlier, fell off Fortune’s annual 100 Best Companies to Work For list for the first time in eight years. In that year, Zappos saw a 26% staff turnover. Many said they had lost control of their work, and that new forms of bureaucracy have become prominent.

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Does it work?

Yes, but also no. While Holacracy has not been around long enough for researchers to have gathered conclusive evidence, companies like Zappos have shown that the use of explicit rules and innovative work circles makes it easier for an organisation to work towards a purpose. However, it also seems that adopting a Holacracy can cause staff to become disillusioned and unhappy, and also form a new type of manager-less bureaucracy in the workplace. Maybe then the best way to approach Holacracy is to take what would work best for your company, like adopting the rules-based meetings, but be wary of changes that would destroy your workplace culture.

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