How do you become aware of a problem with your car? How do you notice that a machine is no longer running smoothly? Measuring devices and warning lights inform you. There are sensors that say ‘Attention!’.
But what sensors are there in your organisation? How do you find out about imperfect processes, delayed decisions and outdated structures? It is your employees who know about them.
Acting as ‘sensors’ in a company, people have access to important information. But it is only if they share that information that sensible changes can be put into action. If this impetus is ignored, however, stagnation reigns and potential is wasted.
How knowledge leads to change
In this context, the human capacity to discover problems in ongoing processes and to see the potential for change is an important gift. The more creative we are and the less we accept the status quo, the sooner we want to further develop what we have.
But – how can change come from knowledge? Most organisations do not have a management structure that allows the information staff have to bring about developments. The traditional hierarchy puts on the brakes.
Management is often in line with the principle of ‘predict-and-control’. In this scenario, traditional organisations aim to achieve lasting success through planning, centralised control and rigid adherence to the strategy.
However, this principle is becoming increasingly ineffective. Business is changing fast. But the organisations are not agile enough to keep up. New forms of organisation are required.
But adaptation is possible. It requires a system. A system which, similarly to the operating system of a computer, makes updates, adjustments and developments possible.
Authority does not require people
Holacracy is such a system. It does not hang on to top-down processes. It demands and supports a new form of authority, because the opportunities for influence that otherwise lie with leaders or managers are divided among circles composed of roles.
This new form of organisation, also (incorrectly) referred to as Holocracy, was invented by Brian J. Robertson. He worked as a software developer and founded the company Ternary Software. Ever since his company was founded, the specialist has been experimenting with new, more democratic organisational structures.
He presented Holacracy publicly for the first time in 2007. With it, Brian Robertson had invented nothing less than a functioning alternative to the traditional management hierarchy. Three years later, Brian Robertson published the Holacracy Constitution, which provides the basis for the formation of new corporate cultures.
Roles rather than positions
Holacracy follows the approach of replacing job descriptions with roles. According to Robertson, job descriptions tend not to be up to date even at the point they are printed.
Holacracy differentiates between roles and the people who fulfil those roles. One person can hold several roles at a given point in time – just like in their personal life, where, for example, there are roles as a parent, community member, neighbour, friend and relative. And just as you make decisions independently and on your own initiative in those roles, Holacracy assumes you can do the same at work.
In organisations, the roles of circles are regularly redefined via a collective governance process. This makes it possible to adjust them to the constantly changing requirements of the company. Every employee can present suggestions to improve the structure of collaboration, which are processed in what are known as governance meetings. A ‘facilitator’ selected from the circle leads the process according to the rules of the constitution.
Infographic Hierarchy vs. Holacracy
A new model for lateral management
So how can the management of an organisation tell that it is time to take a look at a new form of organisation that allows clarity and transparency regarding the work in a team and helps to keep decision-making processes lean and effective?
For Dennis Wittrock, certified Holacracy coach and author, there are clear signs to look out for: ‘It often begins with applicants questioning the authority structure in interviews. They recognise the top-down structure and miss the equal footing. This correlates to increasing dissatisfaction among employees. The people who work more closely with the customer than the company management does would also like to be able to make more decisions.’
What do companies do with this information? If they are serious about it and want to change, they start searching. There are various forms and methods of new management systems and collaboration opportunities to discover. In the end, many find their way, often via scrum and agile, to the new form of organisation called Holacracy.
If you’re not serious about it, you may as well not bother
‘Holacracy functions as a tried-and-tested model, comparable with the operating system of a computer. I don’t need to look for individual components and put them together, but rather I can use it as a complete package’, explains Dennis Wittrock. ‘That awakens interest and makes the offer attractive.’
What should be the first step for organisations that want to implement Holacracy?