Tuesday, January 14, 2014

Holacracy, The Challenge of Change

A company without bosses, where teams of employees can make decisions that are instantly applied and where all the employees are focused on the company goals. Sounds like utopia right? Well it may not be. The concept has been around for years. Give employees the power to manage themselves and let the people at the base level determine what's best to move the company forward. In the most recent incarnation of the theory, named Holacracy by founder Brian Robertson, employees are give a defined level of authority and the freedom to make whatever decisions and actions they would like within that authority.


The concept sounds great, but it's not without it's flaws.

1. No one is in charge - Without managers there is no one to mediate disputes, lead meetings or determine the best process for larger projects to move forward. Some companies are creating a specific circle or team that will handle disputes, but there is no easy way to resolve a leaderless team. particularly if 2 members of the team are completely opposed to each other's plan. Not to mention who will review progress to determine raises?
2. Lack of appreciation - These systems often have issues because their is no tracking of individual progress, minimal feedback and, obviously, no promotional opportunities. A review board could be helpful here but without a check list of some sort how will the board even know that the person is progressing? What will motivate employees to continue to keep the company's best interests?
3. HR has rules  - In theory if any one part of the team fails to achieve the goal then they will be replaced by other people who can. This is a great theory but the reality is that people can't just be fired at will. Contracts, equality laws and other employee safe guards are in place to keep companies from abusing employees. Without a documented reason for removing the person then the company could be in trouble.
4. People - People are both the best and worst part of this concept. If you have great people, who have great skills and all have the companies best interest at heart then it could work great. But most companies do not have this ideal set of employees. They have a mix of people who want power and will hoard resources or information and people who are just there because it pays the bills - not because they care. HR and recruiting departments have a hard time in traditional management structures finding qualified and talented people (assuming that they they get the proper job description in the first place.) A holacratic company won't have an HR department so how will they interview and vet new employees?

This style may work well for smaller companies, where employees are often doing the work of more than one traditional job title and all of the employees are passionate about seeing the company succeed. But larger companies need some type management system to keep order and ensure that one rogue employee isn't completely changing the focus of the company on a whim.

Do you think a holacracy would work in your company?