Holacracy is a new, innovative organisational management model that is aimed at decentralising decision-making power from the old top-down bureaucratic system.
Stressing decentralisation and self-organisation, Holacracy makes organisations bring new levels of flexibility and responsiveness to an enterprise by allowing employees to self-organise based on assigned roles. Any person intending to develop their managerial skills and knowledge can enroll in specialised Management Training Courses offered by the British Academy for Training and Development; this exposes the learner to Knowledge of innovative management practices such as the Holacracy.
This article aims to discuss the core principles of Holacracy, its functioning, benefits and drawbacks.
“Holacracy is an innovative approach to organisational management, designed to decentralise authority and promote autonomy.”
Unlike traditional hierarchical organisations where decisions are made at the top and implemented by lower levels, Holacracy organises organisations around self-organising teams called ‘circles.’ It brings about accountability, transparency, and agility to ever-volatile environments within an organisation’s flow.
Instead of having clear cut roles of the type seen in other managerial structures, a Holacratic employee works under a given restraint. These roles are therefore changing and are defined by the need of the organisation at that particular time. An employee does not directly refer to his or her supervisor, but with other colleagues in self-governing “circles” to weigh on relevant issues of their line of work. Every circle has its own function and has specific assignments and obligations corresponding to that function.
Holacracy structure revolves around three main elements:
Roles:
All have their roles, responsibilities or accountabilities and the powers to discharge them, and these are contained in a “constitution”. In contrast to the typical job positions, these positions are rather fluid, and the description may change over time depending on the organisation.
Circles:
These are the teams which are involved in handling specific operations of the organisation. Every Holacratic structure contains the circles, which are responsible for the organisation workflow, but at the same time, they are interconnected with the rest of the circles, supplying the organisation with unity.
Governance:
The Holacracy Constitution describes rules, roles, and meetings in detail based on which decision-making takes place. It ensures that authority is utilised optimally, and decentralisation of authority in each of the circles.
These are the 3 elements of the Holacracy constitution—roles, circles, and governance— working in synergy to produce a holacratic organisational structure where decision-making and control are devolved in order to foster ownership of organisational responsibilities among individuals and groups.
The holacracy system makes employees to be more empowered and have a higher level of autonomy. Decision-making is decentralised meaning that everyone has a say in what affects them in the decisions made within the organisation. This at times results in increased job satisfaction since the employees feel that they are part of the organisational goals and objectives.
Holacratic structures are worked to be stable and promptly responsive to their existing situations. Due to changes in these roles, skills and requirements they are dynamic and therefore organisations can efficiently align themselves with the external changes, hence fulfilling their mission and vision amidst escalating competition.
In a Holacracy structure, each position has its own accountabilities, these accountabilities are well defined and available for anyone to review. This clarity reduces ambiguity, as everyone knows what is expected of them, promoting accountability.
Holacracy encourages people to open which helps in increasing interactions among employees. Some of the benefits that come with flattening the organisation include being able to eliminate the barriers of interactions across circles that used to be channelled by formative organisations.
Implementing a holacratic structure can be a bit demanding for any organisation that has worked under the autocratic systems of leadership. Unlike rogue workplaces and flop-organisations, the Holacracy Constitution and the rules and regulations therein can be complex and take a lot of time and training for the employees to fully accept and work within.
While decentralisation involves certain decisions in a decentralised manner, it empowers people, hence making decisions a bit confusing, if not managed well. In certain cases, a lack of supply chain management hierarchy may be problematic since consensus may need time when achieved inside certain circles.
One disadvantage stems from the fact that processes in organisations based on Holacracy tend to involve role duplication. A lack of organisational structure ensures that an employee has got many roles to perform, hence may lower productivity and job satisfaction.
There is always some level of resistance to change from the hierarchical model that ought to be implemented to a holacratic model. Organisational members who have worked in more bureaucratic organisations may not be ready to accept change that is brought by Holacracy, especially flexibility and self-management, and may start experiencing conflict or may opt to leave.
The system of Holacracy was introduced in the early twenties by Brian Robertson, an ex-software entrepreneur who wished to improve the approach to companies’ management. Growing tired of the traditions in managerial hierarchical model, Robertson sought to devise a system in which decisions would be made to empower the employees. He formally established HolacracyOne, the company designed to support, market and refine Holacracy in 2007.
Robertson extended his concepts in the Holacracy Constitution, a documentation of rules, roles and processes consistent with the holacratic framework. It is a no-brainer to consider this constitution as the cornerstone of any organisation wishing to adopt Holacracy given that it offers direction on who should make what decision, who should be responsible for which activity, and how the overall organisational structure will be managed.
More organisations over the years embraced Holacracy as a form of new age management structures that several big brands like Zappos ventured into. Despite some organisational experiences indicating that Holacracy led to improvements, the concept remains one of the best-known examples of recent efforts to redesign organisations in response to the demand for more flexible and decentralised management.
Holacracy implementation was set at Zappos, an American internet-based shoe retailer company in 2013 with an intention of decentralising its decision-making under the leadership of Tony Hsieh. With the help of the Holacracy Constitution, the administration of Zappos changed the organisational hierarchy for the self-managing circles instead of the departments, which means that everybody may have several roles in the company.
As this reorganisation was planned to increase organisational flexibility and adaptability, it appeared to have negative impacts as well: first, it was difficult for some workers to adapt to new levels of self-organisation and to perform tasks that had not been expected from them before, multiple roles remaining under their responsibility. Nevertheless, Zappos continued to strive for the construction of the proper organisational culture based on freedom to manage oneself.
In conclusion,
Holacracy is a fast-growing form of management that replaces the conventional approach with flexibility, openness, and responsibility. Although it may create new opportunities for innovation and operational flexibility, its use is limited by the increasing organisational complications and risks. Holacracy is good for those who are ready to take personal responsibility and transform; therefore, great for modern entrepreneurial teams. But success is strictly associated with proper implementation and customisation to the specific organisational environment. Anyone who wishes to develop their management competencies and focus on new strategies consider taking Training Courses in Paris to enhance your skills.