The traditional structures of business are changing; more emphasis is being placed on corporate culture, shared responsibility and unconventional ‘office’ environments – the internet provides a hyperbolic roar of ‘unprecedented change’.  All of this has been made more jittery by the recently re-introduced expression – holacracy.

If you have read any number of the headlines  about retail giant Zappos shunning management titles in favour of holacracy, you may be under the impression that we are closer to a utopian world with no managers, no one to tell you what to do, no deadlines, no stress. Ironically, if that is what is what gets you excited, holacracy will destroy you.

A quick read of the Holacracy Constitution will dispel the misunderstandings presented by some. Holacracy is not non-hierarchical, it is a hierarchy of self-regulating, autonomous units known as ‘holons’. An article in Forbes describes this as a ‘hierarchy of circles that are to be run according to detailed democratic procedures.’ This is not a new concept, in fact it was an idea cultivated by Arthur Koestler is his 1967 novel ‘The Ghost in the machine‘ and developed more recently by Ken Wilber and Brian Robertson.

Each circle is formed of individuals who, instead of having rigid job titles, have more fluid and adaptable ‘roles’ within the organisation. The main aim of this is for individuals and collectives to no longer feel they are only responsible for a small area of the company’s success but instead to pool their talents and work within a democratic and transparent framework – everyone, no matter what their ‘role’, now takes responsibility for the success of the business.

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Despite the fact that management titles are replaced by ‘roles’, these roles still involve tasks that managers would otherwise be required to take on. Instead of CEOs, COOs and MDs, there are now assigned ‘Partners’ responsible for a number of actions, including sensing and dispelling tensions, setting ‘next-actions’ and implementing authorisations or restrictions – still sound like a free-for-all to you?

In order for holacracy to work, all individuals within each circle must be prepared to work, if they are not, it is not the system that will fail but their career. Holacracy, in its aim for total transparency, holds every role within the organisation to account and demands that each take responsibility for the success of the business. This is not a new concept for freelancers and contractors, as we have, in a sense, been working in some form of holacracy for some time. We take on the roles of our personal brand – self promotion, research, administration, project management – and are guided by the actions, expectations and restrictions of our clients.

Holacracy in larger organisations requires an already strong corporate framework in order for the dynamic steering structure to be effective. Concrete decision making processes are now more important than ever and for a company like Zappos, which already had a very successful Agile Management system in place, a switch to holacracy seems logical and so far effective. However, for other large corporations it could prove a trickier pony to ride, as decades of administrative structure is not so easily changed. Furthermore, with so much of a focus on internal evolutions, targets and maximising shareholder profits, there could be a potential risk of ignoring the all important customer.

For small businesses and start-ups, a hybrid of holacracy could be the answer, perhaps even with a collection of start-ups working together, pooling their talents and innovative ideas to form the next revolution in business management. One thing is certain though, call a boss by any other name and they can still tell you what to do.

Images by TrevorJorge Lascar and Rakkhi Samarasekera