I’ve been with HolacracyOne now for a few months. It started slow, but now I energize over twenty roles across four circles. Also, this isn’t my first rodeo when it comes to operating within the Holacracy framework.

In 2016 I lived in downtown Las Vegas and Zappos was in the middle of their controversial adoption of Holacracy. I wasn’t working at Zappos, though. I was starting a church. With the revitalization of the downtown Las Vegas community came a myriad of entrepreneurs and businesses. And within every community you will find a church of some sort.

As we were fundraising and team-building we met HolacracyOne partner, Olivier Compagne. He became a friend and a wonderful resource for Holacracy. I had heard about this innovative new way of working and began exploring on my own how it might work in a church. But Olivier helped me make it a reality. And with the help of another certified Holacracy Coach who joined the leadership team at the church, we were able to adopt Holacracy in a powerful way.

This was a church. A religious non-profit. The big question was how to operate using Holacracy but within the largely volunteer make-up of the workers. No one was paid. We had key partners who took on meaningful work. So, we took the work and the people and began to structure the organization using Holacracy and its accompanying software, GlassFrog.

It worked beautifully. Within months, volunteers were making important decisions which moved the church launch forward in meaningful ways. Volunteers were leading their roles. Not everything fell to the “pastor/founder” to decide.

It was nice. I was healthy, and while there were natural ebbs and flows of people and roles being added and subtracted, the organization seemed to just keep getting better. And our community at-large was reaping the benefits.

We had started from the ground up and we were creating and recreating the organization as we went. The “start-up” nature of the church was fun and everything and everyone was in a really wonderful flow.

As you may know, starting an organization using Holacracy is very different from entering a company already using Holacracy. And when I entered THE company, who not only used Holacracy but created it, there was some catching up to do.

Here’s what I learned…

• There was a lot of governance to review. So much already existed. I was now energizing roles that had been energized by a different human. There were existing accountabilities, domains, and policies. Oh the policies! Learning what currently existed as soon as I could was so important. GlassFrog made this so easy, because Holacracy made it so transparent!
• My roles were malleable to an extent. This actually took me some time. I consciously knew that my roles could be reformed and reframed through the governance process, but I didn’t own it right away. That was probably a good thing. I had to give myself time to feel the role and recognize my tensions. Once I did, I was able to approach governance with actual tensions and not anticipated ones.
• I held authority right away; even though it didn’t feel like it. I started with HolacracyOne holding mostly administrative type roles. I was answering customer service calls and doing small work to help others. This gave me a feeling of “inferiority” to some extent. But I was constantly reminded by partners to use my authority. “Oh yeah…duh!”
• Everything is essentially the same but different. I think this is one really practical yet impactful thing to remember. Holacracy does work the same in different organizations. The rules are the same. The processes are the same. The context is different. And while that takes getting used to; the essential nature of Holacracy hasn’t changed and that’s comforting.
• Purpose truly directs action if you let it. The purpose statement at our church and the purpose of HolacracyOne are fundamentally different. But each drives the decision-making process. I caught myself, even today, reviewing the HolacracyOne Purpose, and I look forward to exploring an update soon. Why? Because purpose matters. Personally. Organizationally. Purpose matters!

“Knowing your purpose satisfies a deep need that lives in everyone: the need for meaning, to have a positive impact, to have your presence and life felt by others.”

Tim Kelley, True Purpose

It doesn’t matter whether it’s Holacracy in a church or in a consulting firm or law office or school; it’s going to be the same, but different. Moving from one organization to another can be tough, even if their fundamental structure is the same.

Starting, brand new, at a Holacracy-powered organization can be tough as well. The key is understanding and owning your power. And if you’re with wonderful people like I’m with at HolacracyOne, they will patiently guide you and love you through your mistakes!

What I’ve Learned About Holacracy After Working In Two Different Holacracy-Powered Organizations was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

What inspires leaders to forgo traditional hierarchies in favor of self-management? Over the last 15+ years working with visionary change-makers, we’ve learned that many want freedom from decision-making overwhelm and desire to unleash creativity to remove bottlenecks. Ambiguity often results in gridlock and the tyranny of indecision ⏳

Whether your goal is to run a fully self-organizing company or simply implement select tools to enhance self-management practices, the first step to real change involves bringing deeper awareness to the current reality, systems, processes, and often-subtle relational agreements that dictate unspoken team dynamics 👥

In the push to drive change, some leaders attempt to skip over an essential reflective step — and inadvertently undermine their efforts!

In his newly launched e-book, Holacracy Kickstart Guide: A roadmap to initial structuring, Holacracy Master Coach Chris Cowan, Ed.D., M.Div., provides practical tools to unearth this essential step and evaluate fit, allowing the leader to set the success perimeters before embarking on this journey 📊 Through examples and intuitive frameworks, Chris illuminates the path to bring about greater organizational clarity, the foundation for a thriving self-management practice. When role clarity is high, individuals can make decisions more confidently and efficiently, solving bottlenecks at every level.

Effective structure & habits: to drive effective change 🚀

With this newfound awareness and deeper insight into the mechanics of an organization, you can more easily assess the behavioral patterns and ways of relating that reinforce bottlenecks and ambiguity, for example. These are the very human, sometimes messy pieces that can be uncomfortable to evaluate! Again, it’s tempting to skip this step, but it actively clarifies what you are moving away from as you embrace the mindset shifts required to operate in a self-managed environment. This process of inquiry involves individual and interpersonal dimensions 🧑‍💻👩🏽‍💻 The Behavioral Change Stairway Model illustrates how authentic human connection makes up the “foundational building blocks” for individual and organizational change:

If you’re interested in learning more about “How to Upgrade to Self-Management in 5 Building Blocks,” join Holacracy founder Brian Robertson for a free 45-minute webinar on Nov. 7 at 10 AM US Pacific Time 💻 It’s a great complement to the Kickstart Guide. Reserve your spot today!

📘 Learn from a new Holacracy Kickstart Guide packed with tools for success was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

Attention all Holacracy Newbies, Practitioners, and Coaches!

Do you want to get started with Holacracy, but you’re not sure how? Or, do you just want an up-to-date explanation of Holacracy you can share with others? Well, if so, I wrote, “The Holacracy Kickstart Guide” with you in mind.

Now, this isn’t your typical, run-of-the-mill conceptual explanation of Holacracy. No, siree! I’ve rolled up my sleeves to create a guide that’s more of a hands-on roadmap for adoption and initial structuring. After all, the first step in the Holacracy journey is often the hardest, and the Kickstart Guide is here to hold your hand through it.

Note: For direct support or questions regarding Holacracy adoption, please contact a certified Holacracy coach. Or, for general questions please post on the Holacracy Community of Practice.

What’s New?

First things first, this guide is fresh out of the oven. It’s packed with real-world examples and coaching to help you get started. But that’s not all. Because the Holacracy constitution version 5.0 allows for flexible and modular adoptions, this added customization comes with an added layer of complexity. This guide simplifies that complexity by clarifying what I call the, “One practice, many paths” approach.

The Heart of the Matter

The guide takes you on a journey from the conventional world to the Holacracy realm using a simple example — the “head chef” at a restaurant. You’ll see how to translate that typical job description into a set of Holacracy-style roles for more organizational clarity.

DIYers, You’re Not Alone

The guide is also designed particularly to empower the Holacracy do-it-yourselfer. Anyone with the drive and patience can make Holacracy practice work for their team or organization, and while a little extra guidance from a certified coach is always helpful, you have to be strategic about where you spend your time and money. This guide will allow you to get up and running yourself, or at least give you a better sense of what it takes!

So, check out the “Holacracy Kickstart Guide” today and take the first step toward a more dynamic and flexible organizational structure!!

-Chris C.

Introducing: The Holacracy® Kickstart Guide was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

We began our journey exploring the terrain of self-management by looking at Purpose, defined broadly as a “reason for being.” Purpose is like a compass, providing critical orientation for leading organizations 🧭 It’s no longer a luxury, but essential in today’s business landscape. If you missed the introduction or are a new subscriber, you can learn more here.

This week we are exploring Strategy, the how behind purpose. In pyramid hierarchies, strategy is a top-down process and directive 📣 The executive team sets forth a grand plan, through a series of decisions and prescriptive actions, to achieve the organization’s mission and purpose. There is a whole body of management literature written from this perspective. But it has real limitations — especially in highly dynamic environments.

Covid turned that cherished approach on its head. Overnight, companies had to re-evaluate entire lines of business to stay relevant 📈 Human “sensors” on the frontlines, who hold critical data around customer needs and preferences, became far more important. Companies that embraced adaptive strategy processes raced ahead of the rest 🏃🏽‍♀️

At HolacracyOne, we responded by retooling our social technology and upgrading the Holacracy Constitution to v5.0 to support a broader range of companies on the path to self-management 💡 When clients asked for more incremental, customized solutions, our in-house Agile expert Michael DeAngelo led this transformation in partnership with The Athena Group and other early beta testers. (Learn more about the upgrade to v5.0 here or attend an in-person training event to experience it yourself!)

What is adaptive strategy, aka dynamic steering?

Dynamic steering, a term sometimes associated with Agile management methodologies, refers to a decision-making process that emphasizes continuous adjustment and real-time adaptation ⌚️ Instead of making decisions based on static, long-term plans, organizations using dynamic steering make smaller-scale decisions more frequently, continually adjusting course based on the current situation and the most up-to-date information. For example, Spotify is often celebrated for the way its cross-functional, autonomous teams apply similar principles to fuel innovation.

This approach enables organizations to respond rapidly to changes, whether those are shifts in the market, technological advances, internal developments, or other factors. Dynamic steering requires a culture of trust, openness, and fluidity 🌊 where team members feel safe to share information, voice their perspectives, and make decisions.

Honing the practice of sensing-and-responding 🔁

Holacracy founder Brian Robertson often uses the analogy of operating a plane to convey the difference between collectively “sensing & responding” to the environment vs. relying on a top-down “command & control” approach to strategy. Every organizational sensor holds critical information necessary to safely operate the metaphorical ✈️. At worst, ignoring a lone flashing engine light — i.e., failing to listen to fresh and diverse perspectives — can lead to catastrophe. At best, unique insights steer the organization in service of its purpose.

A healthy culture of sensing-and-responding means that every individual is equipped with the tools needed to identify and act on any felt tension — in this context, defined neutrally as “awareness of any gap between reality and what’s possible” ↗️

Mature self-managed organizations encourage the development of intuitive intelligence as much as rational observation through sensing-and-responding to tensions. This is a wholly different approach than being asked to adhere to a rigid, top-down strategy — and with far more generative results. To effectively act on these tensions and intuitive insights, you need:

👥 Distributed decision-making power

Authentic P2P (peer-to-peer) dynamics, in contrast with the P2C (parent-to-child) dynamics that are prevalent in pyramid hierarchies. In self-managed systems, sovereign individuals are expected to seek the advice of peers who may be impacted by their decisions or have a relevant zone of expertise.

📊 Information and data transparency

In healthy P2P environments, members share information freely, so everyone has the scope of data required to energize their roles and operate entrepreneurially.

🗣 Cross-functional collaboration

Access to data also means enjoying open lines of communication. The role-based structure that underpins self-managed organizations is design to facilitate this.

🤝🏾 Healthy conflict resolution processes

When everyone is encouraged to act as a sensor and process their tensions, conflict is inevitable. But with the right tools, it can be healthy. Frameworks like NVC (Non-Violent Communication) and IDM (Integrated Decision-Making) give participants pathways to resolve tensions and strengthen relationships with their peers in the process.

Zooming out: Dynamic steering involves continuously facing and responding to reality. It’s designed to present guardrails around the negative cascading effects of groupthink, which is often propelled by shared delusion, denial, and attachment to decisions-by-consensus.

Sensing-and-responding honors everyone’s individual and collective reality. It’s a collaborative practice honed over time.

Resources for deeper exploration

📑 Clear and organic structure with Holacracy

🎧 How ‘tensions’ drive meaningful organizational change

In-Person Holacracy Practitioner Training

Interested in an experiential deep dive where you get to immerse yourself in the process of dynamic steering? Join Holacracy founder Brian Robertson and other Certified Holacracy Coaches in Amsterdam from September 12–15 for Practitioner Training. Reserve one of the last available spots today.

Dynamic steering as a tool for strategic decision-making was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

Do you know why many organizations struggle to effectively serve a purpose? Some might point to short-termism or lack of buy-in across the organization. But there’s always more to the story (and many top-performing public companies rose to prominence with a strong orientation around purpose). According to a comprehensive study by Harvard Business Review Analytic Services and EY Beacon Institute, wayward organizations tend to overlook the importance of a communications strategy that integrates purpose from leadership across all roles, functions, and stakeholders.

Of the hundreds of organizations surveyed by HBR and EY, 84% of executives said shared purpose drives successful innovation & transformation efforts. Those who effectively prioritized purpose reported increased employee engagement, customer loyalty, revenue, and other business outcomes. What was once viewed as a luxury is now essential to competing in today’s business landscape.

Covid, the Great Resignation, the Quiet Quitting movement, and challenges with remote work and self-organization moved purpose into even sharper focus. To thrive in this new global economy, effective remote and hybrid work strategies proved only part of the equation. Strong purpose alignment is the other essential piece for organizational cohesion and effective self-management.

When purpose is deeply integrated at every level, dynamic steering is not only possible, but it becomes an easeful, natural process. On the other hand, when purpose is merely a platitude — or occasionally used as a lever — its power diminishes over time.

Purpose is existential and concrete. Purpose strikes at our reason for being — the deepest parts of ourselves that seek creative expression. It is also a very practical tool for organizational longevity. A strong, compelling purpose will attract the employees, clients, and other stakeholders who can best advance the purpose because they are internally aligned.

Purpose inspires healthy engagement. When there’s alignment between individual and organizational purpose, morale skyrockets. In the old, pre-Covid era, employees often sacrificed themselves for a company mission. In the new era of deeper purpose integration, leaders are more attuned to the nuances of aligning individual + organizational purpose.

Purpose is a vector for alignment. It guides strategy and decision-making at every level. This frees people from running in opposite directions or talking past one another about an approach to a project. It brings clarity and cohesion. In the old world, employees chased after moving financial targets. In the new world, company objectives are purpose-aligned.

Purpose increases psychological safety. There are many benefits of heightened psychological safety for teams and individuals. When it’s safe for diverse perspectives (i.e., all organizational “sensors”) to be heard, more work gets done and entrepreneurialism increases. A shared sense of safety also increases when team members can trust they’re all working toward the same objectives and broader purpose.

Purpose fosters a culture of collaboration. When purpose is genuinely at the helm, individuals are incentivized to work together, and over-competitiveness dissipates. This frees up energy for new ideas to emerge.

An added bonus: this collective mindset shift informs how the organization engages with the broader marketplace. There’s a stronger focus on partnerships, collaborations, and co-elevation with other purpose-aligned organizations.

Purpose fuels resilience. Going back to that original point about intrinsic motivation: purpose energizes individuals to overcome challenges and seek creative solutions.

When organizational purpose needs a refresh

Whether due to changing market conditions or any number of factors, sometimes purpose merits a refresh. This is especially true during times of significant internal change — such as following a merger, acquisition, or shift to new leadership.

If there is a lack of alignment or engagement with the purpose within the company or amongst stakeholders, it could also be an indication that the purpose needs to be clarified, communicated more effectively, or possibly re-evaluated. A company’s purpose should remain relevant to its environment, the needs of its stakeholders, and the world at large.

To increase alignment, try implementing OKRs and experimenting with other prioritization tools like even/over statements and focusing methods like GTD. Heightened clarity is a motivator. So is knowing that you’re making progress toward your goals and broader purpose.

In-Person Holacracy Practitioner Training

Interested in an immersive learning experience to acquire the tools and best practices to align your team and/or organization to purpose? Join Holacracy founder Brian Robertson and other Certified Holacracy Coaches in Amsterdam from September 12–15. Reserve your spot today.

Purpose is an essential vector for organizational alignment was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

What would a new political decision-making process have to look like to honour all layers of cultural values in a nonexclusive way?

In his book “Developmental Politics,” Steve McIntosh develops a new political philosophy to help overcome the extreme hyper-polarization that plagues western democracies — the United States in particular. He argues that there is a cultural war raging between the proponents of major value systems that have emerged throughout history. In his view, the values of “traditionalism,” “modernism,” and “postmodernism” form the central “bedrock values” of the American society (and comparable Western societies).

Modernism itself has, over time, further divided into two camps in the United States: “Liberal Modernists” and “Fiscally Conservative Modernists.”

The problem is that these camps are at each other’s throats. The challenge is to encompass them in a higher order system that honours the strengths of each worldview, while at the same time preventing their excesses.

McIntosh views these value systems as existing in both a developmental as well as a polar relationship with each other. By referencing the theory of polarity management, he points out that in any polarity in which both poles are positive, no one pole can ever “win” since both poles challenge as well as complement each other. Each pole has its upsides and downsides, as summarised in this diagram.

Getting rid of, say, traditional values doesn’t help postmodern values, because it would rob society of the social cohesion and order that is ultimately required for postmodern values to emerge in the first place. Likewise, modernism “winning” against postmodern environmentalism would maybe enhance some people’s profits in the short term, but ultimately saw off the branch we’re sitting on in terms of the carrying capacity of the planet.

Now, all of these values have emerged for good reasons and need to be harmonised in an overall system for each of them, and the greater whole of society, to be able to flourish. None of them can be safely excluded from having a seat at the political table — nor should they be flippantly discarded. Instead, polarities of this kind have to be continuously managed.

Values Integration

McIntosh calls the corresponding political process “values integration.” Apart from the issue of marijuana legalization, he gives the example of gay marriage to illustrate how an additive process of including all “bedrock values” can lead to wider social acceptance of new policies:

Advocacy for the right to marry has been instrumental in the larger success of the gay rights movement overall because the cause of gay marriage integrates important values from each of the four major value systems illustrated by the
charts. Gay marriage advances caring values, fairness values, liberty values, and crucially, traditional family values (heritage values). Traditionalist who otherwise object to “decadent homosexual lifestyles” find it much harder to
resist calls for the basic right to make a family commitment through the institution of marriage. While perceived traditionalist interests are not included in the new right for gays to marry, traditionalist values are included nonetheless. It was thus through values integration that this previously polarized issue has not only become law, it has also gained widespread social acceptance.

It’s a bit like playing guitar: if you don’t hit all the strings, the chord just won’t sound as good as it could.

A Robust Political Process for Integrating Values

While McIntosh does a great job of providing a broad outline and the philosophical underpinnings for how this higher integration might occur, he is less clear about what specific process could be used to make day-to-day political decisions.

That said, my guiding questions for this exploration were:

What are the conditions for integrating representatives of these value systems in a political decision-making process that is both constructive and has the potential to honour the fundamental concerns of each party involved?

How can we make sure that each party can bring their gifts while relying on the watchfulness of the other value systems to curb their potential excesses (the negative aspects of their value pole), whenever needed?

How can we design a decision-making process that implicitly teaches the value of each of the bedrock values to the other parties?

How can we integrate the wisdom of all these perspectives while avoiding political stalemates and ideological trench warfare?

Luckily, we don’t have to completely reinvent the wheel when it comes to decision-making processes. From my background as a Holacracy Coach, I am very familiar with the Integrative Decision-Making process (IDM) that is used during governance meetings to integrate conflicting views on the best way forward in organizations. My sense is that by tweaking and experimenting with this process, it can be successfully exported to work as an initial answer to the questions raised above.

Integrative Decision-Making

IDM is a robust process that is described in detail in the Holacracy Constitution. It reliably leads to workable outputs that have been checked for potential harm. It does so by following clearly delineated rules. An elected Facilitator ensures that the circle (the team) sticks to the rules of the process.

Essentially, IDM is a recipe for a well-run and civil discussion which is highly outcome-focused.

Here’s an excerpt from the Holacracy Constitution (v5.0):

§5.4.5 Integrative Decision-Making Process

The Facilitator must enact the “Integrative Decision-Making Process” as follows:

• (a) Present Proposal: First, the Proposer may describe the Tension and present a Proposal to address it. On the Proposer’s request, the Facilitator may allow others to help craft a Proposal. However, the Facilitator must focus this help solely on getting to an initial Proposal to address the Proposer’s Tension. The Facilitator must disallow discussing other Tensions or concerns about the Proposal.

• (b) Clarifying Questions: Once the Proposer makes a Proposal, others may ask questions to better understand the Proposal or the Tension behind it. The Proposer may answer each question, or may decline to do so. The Facilitator must stop any reactions or opinions expressed about the Proposal, and prevent discussion of any kind. Participants may also ask the Secretary to read the Proposal or show any existing Governance, during this step or at any other time when the participant is allowed to speak, and the Secretary must do so.

• (c) Reaction Round: Next, each participant except the Proposer may share reactions to the Proposal, one person at a time. The Facilitator must immediately stop any out-of-turn comments, any attempts to engage others in a dialog, and any reactions to other reactions instead of to the Proposal.

• (d) Option to Clarify: Next, the Proposer may share comments in response to the reactions and make amendments to the Proposal. However, the primary intent of any amendments must be to better address the Proposer’s Tension, and not Tensions raised by others. The Facilitator must immediately stop comments by anyone other than the Proposer or Secretary. Any engagement by the Secretary must focus solely on capturing the amended Proposal.

• (e) Objection Round: Next, each participant, one at a time, may raise concerns about adopting the Proposal. The Facilitator must either capture these concerns as Objections, or test them to see if they meet the Objection criteria and capture any that do. If there are no Objections, the Proposal is adopted. While testing concerns and capturing Objections, the Facilitator must stop and disallow discussion or responses of any kind from anyone other than the Objector.

• (f) Integration: If there are Objections, the Facilitator then focuses on each one, one at a time. For each, the participants brainstorm to find a potential amendment to the Proposal to resolve the Objection. The Facilitator marks an Objection resolved once the Objector confirms that the amended Proposal would not trigger the Objection, and the Proposer confirms that it still addresses the Tension. During this step, the Facilitator must apply the rules of integration described in this Article. Once all Objections are resolved, the Facilitator moves back to the Objection round with the amended Proposal.

A key piece of the process is the Objection Round (e), sometimes also called the “safety check” of the proposal. Here the Facilitator asks each person whether they have concerns with regard to the proposal. In an organizational context, each person speaks as a sensor for the organizational role it is inhabiting, sensing into whether the proposed change would hinder them in expressing the purpose or accountabilities of their roles. In this way, this step acts as a safety net, eliciting concerns from the group before the proposal gets implemented. But not every concern necessarily constitutes an objection that needs to be integrated. That’s why the Facilitator tests the concerns according to the following four criteria.

§5.3.2 Objection Requirements

A concern about adopting a Proposal only counts as an Objection if the Objector can provide a reasonable argument for why it meets all of the following criteria:

• (a) The Proposal would reduce the capacity of the Circle to enact its Purpose or Accountabilities.

• (b) The Proposal would limit the Objector’s capacity to enact the Purpose or an Accountability of a Role the Objector represents in the Circle, even if the Objector filled no other Roles in the Organization.

• (c) The concern does not already exist even in the absence of the Proposal. Thus, a new Tension would be created specifically by adopting the Proposal.

• (d) The Proposal would necessarily cause the impact, or, if it might cause the impact, the Circle wouldn’t have an adequate opportunity to adapt before significant harm could result.

However, regardless of the above criteria, a concern always counts as an Objection if adopting the Proposal would violate a rule in this Constitution.

§5.3.3 Testing Potential Objections

The Facilitator may test whether a concern counts as an Objection by asking the Objector if the concern meets the required criteria, and how. When assessing responses, the Facilitator may only judge whether the Objector presented arguments for each criteria using logical reasoning. The Facilitator may not judge on the basis of an argument’s accuracy or the importance of addressing it.

Necessary adaptations of the IDM process for a political context

These rules work in a certain context: that of Holacracy, a role-based organizational operating system. To make it work in a political context, some of the basic parameters would have to be tweaked.

In Holacracy, people are sensors on behalf of their organizational roles.

In the adapted version of the process, people would act as sensors on behalf of one of the essential bedrock values. Usually, that’s what politicians have been voted into office for — to represent a certain set of values (often regardless of particular political platforms, policies, or election promises).

Before entering the process, participants would self-identify as a “sensor” representing at least one (or more) of the bedrock values from the list above. This would have the beneficial side-effect of implicitly teaching them the contours of the positive expression of all of these value poles (the upper quadrants of the diagrams above) which they often never pause to even consider.

The Facilitator would highlight that while participants can not necessarily expect their preferred solution (their proposal) to be accepted as-is, they can expect their original impulse to resolve a problem and that their bedrock values will be honoured and protected. Every participant will be able to raise objections, and for a proposal to be ultimately adopted, all objections would have to be integrated first.

In Holacracy, the objection requirements act as an effective filter against highly subjective and unproductive objections. It’s not a filibuster situation in Holacracy. There are no personal vetoes that can grind the process to a halt. Objections must be rooted in the organizational role, not just in a personal agenda. Every concern is rigorously tested against the criteria outlined above (§5.3.3). Concerns that do not satisfy all four criteria do not qualify as objections that need to be integrated. They may be independent concerns, but none that would constitute a reason why the proposal on the table would create harm if it was adopted.

To work in a political setting, the objection requirements would have to be modified:

• (a) The Proposal would violate one of the bedrock values as sensed by the value’s representative.

• (b) The concern does not already exist even in the absence of the Proposal. Thus, a new Tension would be created specifically by adopting the Proposal.

• (c) The Proposal would necessarily cause the impact, or, if it might cause the impact, the governing body wouldn’t have an adequate opportunity to adapt before significant harm could result.

As you can see, I replaced the first requirement, erased the second one (it does not really apply), and slightly altered the fourth (now third) requirement.

The test question for criterion (a) might hence sound like this:

“Does the proposal violate a particular bedrock value… OR … do you find it unnecessary or incomplete?”

Further, the Facilitator would ask: “If yes, which value and how?”

Here, an argument needs to be presented by the person raising the concern. It is important to mention that the Facilitator only judges whether a reasoned argument has been presented, not whether they personally agree with it. Presenting a reasoned argument that would justify a violation of the bedrock value in the eyes of the harm-sensor would be sufficient at this point of the testing process to satisfy this criterion.

If the objector merely finds the proposal unnecessary or incomplete, their concern doesn’t constitute an objection according to these rules. Hence, it would be disregarded in the integration step. At this stage, the Facilitator is only testing for harm with regard to bedrock values the representative claims they want to protect.

If a concern has passed the test and qualifies as an objection, this does not mean that it stops the proposal at hand. The tension behind the original proposal is still being honoured. It simply means that the objection raised needs to be integrated during the integration step. The goal of the integration step is to explore the solution space together with the original proposer as well as all the objector(s). They work together as sensors for the specific values they are pursuing. An amended proposal has to satisfy both sides: the proposer and the objector. If there are difficulties or resistance to integration attempts, the “Rules of Integration” (§5.3.4) give the Facilitator some more teeth to arrive at a solution.

This process of joint solution-seeking gets us out of WIN:LOSE territory into WIN:WIN or “OMNI:WIN” territory.

The process described above would give us a basic setup that can be used to run experiments in political contexts where representatives are willing to enter a good-faith dialog to overcome difficult stalemates and reach more integrated solutions.

Obviously, my proposal leaves many questions open, such as who can participate under which condition, how is the Facilitator elected, etc. But it could catalyse a process of experimentation among the open-minded in each party, starting a recursive learning loop in which the rules of the process can be tweaked and refined along the way — similar to the continuous evolution of the Holacracy Constitution. Let me know what you think.

Who knows, maybe it could even be a catalyst to evolve the American Constitution as well?

I would like to thank Steve McIntosh for permission to use the charts from his book “Developmental Politics”.

Values Integration via the Integrative Decision-Making Process was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

What happens to a company’s culture and hiring practices when conventional management is thrown out the window? How do expectations about when and how employees get work done shift? What about collaboration? How do the qualities that the company looks for in candidates change?

These are all big questions that Convert, a conversion optimization software company, faced as they adopted Holacracy.

I recently spoke with Morgan Legge, who fills their aptly named “Holacracy Bootstrapper” role. We discussed what attracted Convert to Holacracy and how adopting the framework has positively impacted their hiring practices and overall workplace culture.

First Impressions

About six years ago, Convert’s co-founder and CEO Dennis van der Heijden approached Morgan with an unusual request. Dennis had recently seen a TED talk about a self-management system called Holacracy, and he had a sense that it could solve some problems that were surfacing at his growing company. Though he was unfamiliar with the nuts and bolts of Holacracy practice, he knew that shifting from traditional hierarchy to self-management would be a significant undertaking. But he wasn’t quite sure how to get started, so he recruited Morgan to research Holacracy and to design a plan to “bootstrap” an adoption.

Dennis and Morgan had met at an entrepreneurial meetup a few years prior and kept in touch. When Dennis approached her with this idea, Morgan was working in interior design and sales with a different company, and also had years of experience in project management and hiring. Although Morgan wasn’t a Convert employee at the time, he reached out to her because, in his words, Morgan “seemed blunt, passionate, and trustworthy. As I was going to be the main obstacle to overcome [in Convert’s Holacracy adoption], I thought those would be the most valuable skills I’d need to change the company.”

Morgan had never heard of this “Holacracy” thing before. Her first impression?

This is super cool! This is kind of like putting people at the center of charting their own destiny.

So Morgan got to work. She described researching Holacracy as a part-time job, spending about ten hours every week reading the Holacracy Constitution, attending online meetups, and soaking up as much information as possible — all while planning how to fully run a Holacracy adoption.

Workplace Culture: Autonomy and Creativity

As Morgan began her research into Holacracy practice, the emphasis on autonomy immediately stood out. As a hiring manager, she had already learned to seek out candidates who showed initiative and self-direction. These attributes were strong indicators of success in all employees, from entry-level construction workers to highly specialized tradesmen.

“It checked a lot of boxes for me, in terms of what I think is the best way to do great work,” Morgan shared. “My best work has always been when I didn’t have to work in an office and be chained to a desk for forty hours a week. I liked the autonomy of setting my schedule, of taking responsibility for my decisions.”

Since adopting Holacracy, Convert has found that autonomy is most powerful when it exists for all employees, and not just the “higher-ups.” By giving everyone the authority to try new things and take initiative, Holacracy practice has fostered a culture of innovation at Convert — of trying, failing, and trying again. When experimentation, initiative, and even failure are everyday occurrences, breaking the mold becomes a much less intimidating prospect.

It gives so much power to creativity. It puts your own initiative on jet fuel… You can really try and fail, and try and succeed, and that’s rewarded when you see how many people doing that together, going in the same direction, can create great things.

Hiring

But this kind of workplace culture isn’t for everyone. As Morgan led Convert’s Holacracy adoption, she realized that by abandoning traditional management hierarchy, it wasn’t just the logistics of hiring that would have to change. In her new role as HR Champion, she would have to reassess the criteria against which candidates were vetted in the first place — a crucial decision for a team of five that was looking to grow.

Without managers directing work, Convert would obviously need employees who were comfortable taking initiative. This was no longer simply a “plus” or a strong indicator of success in a candidate — it had become a necessity. And not only would team members need to be comfortable with their own initiative and autonomy: they also needed to see the autonomy of their coworkers as an asset and not a threat.

People can take the initiative of others very personally. It’s like, “This is mine! Don’t touch this!” You have to separate the role and the soul.

In Holacracy practice, anyone can take any action to serve their role’s purpose unless there is an explicit rule against it. So if you fill the Event Planner role and you want to add information about an event to the company’s website, you might assume that you need to get permission from the Website role. But unless there’s a rule against editing the company’s website without permission, you can post whatever you need to do your work.

This is a big shift. Many people struggle to adjust to this dynamic, especially when so many people integrate their work as part of their personal identity. “I’ve seen this happen,” Morgan said. “People can take the initiative of others very personally. It’s like, ‘This is mine! Don’t touch this!’ You have to separate the role and the soul. And some people are not capable of doing that, or they don’t want to learn, and then they’re not a good fit.”

And with no singular boss to dole out feedback to employees, feedback and input come can come from anyone and everyone. If you have an idea to share, you’re no longer expected to bring it to your boss and hope that they delegate it. You can just bring your input and ideas to the relevant colleague, and if they like your feedback, they’ll integrate it into their work. (Conversely, if they don’t like an idea, they don’t have to do anything with it.)

But after working in traditional management for years, it can be uncomfortable to receive feedback from someone who isn’t your boss. As Morgan says, “I think to thrive and succeed, you need to be able to take input and take feedback on your roles… And someone who doesn’t have that ability could very easily take offense to [feedback] or start reading into it: ‘Oh my God, does she think that I’m not good at this? What does this mean?’ And that is not conducive to a good working relationship. And if you’re not somebody who’s willing to learn and evolve, then that’s probably not going to work.”

As a result, Morgan also looks for job candidates who are excellent communicators, who are comfortable with a high level of transparency, and who “have analytical mindsets, and don’t take things at face value.” She described these as “nice” or “good” to have in a management hierarchy, but absolute “must-have” qualities in Holacracy.

Is It Worth It?

I realized that at this point in our conversation, Morgan had described several qualities that went from being nice to being essential in Holacracy practice. I commented that she seemed to be setting a higher bar for job applicants — and that with all of these extra requirements, the pool of job candidates probably shrunk after adopting Holacracy.

So, I asked: Is it worth it?

“Yes,” she said. “Absolutely.” While a smaller candidate pool is a price Convert is certainly willing to pay for the benefits of Holacracy practice, Morgan didn’t even see it as a price. She wants self-motivated, creative, communicative people on her team anyway. As she mentioned before, they’re strong indicators for success, whether your company runs on Holacracy, traditional management, or something in between.

“I think we, as employers in general, set the bar too low for hiring talent… We think, ‘Oh, I have 150 applicants; that’s so much better than 50!’ Not really, if they suck. I would rather have 50 quality people to go through than 150 that kind of check some of the boxes, right? So yes, I definitely think it’s worth it.”

Where the Whole Self is Welcome

Holacracy has changed more than how employees (also known as “Converters”) get work done together. Morgan shared that “Holacracy requires a very, very high level of transparency. And that has rubbed off on our organization culturally.”

I think that, while you are separating the role and the soul to be a good Holacracy practitioner, that transparency that is required for the work then also allows you to bring your whole self to work. You can show those other parts of you and not have to be worried that they are somehow a judgment or a lens about the quality of the kind of work you do.

This transparency — coupled with the conscious separation of role and soul so strongly emphasized in Holacracy practice — leaves Converters more comfortable connecting and sharing on a personal level than in conventional workplaces.

“You end up with this inspirational spark within people to share, transparently, lots of other things — about their professional development, about what they cooked for dinner… So I think that, while you are separating the role and the soul to be a good Holacracy practitioner, that transparency that is required for the work then also allows you to bring your whole self to work. You can show those other parts of you and not have to be worried that they are somehow a judgment or a lens about the quality of the kind of work you do.”

Morgan described how her team has several Slack channels dedicated to topics like food, health, “humble bragging,” reading, and watercolor painting — spaces where people can chat as people, sharing their diverse experiences from their varied cultural backgrounds (Converters live in nineteen countries around the globe).

If you really separate the role and the soul, if you actually do the work to make that happen, you end up with really powerful cultural connections.

Convert Today

In the six years since their Holacracy journey began, Convert has grown from a team of five to over forty members and is now a multimillion-dollar company. They maintain a deep commitment to conscious business practices such as carbon neutrality, gender equity, and inclusivity — even declining to do business with companies that violate their principles — and have found that that commitment is ultimately good for business, too. And their concept of conscious business extends beyond their actual business practices to how Converters are treated, placing as much value on happiness and growth as they do on sales metrics.

The result? A happier, more engaged team communicating efficiently and unafraid to connect on a human level.

“We spend most of our lives at work, you know,” Morgan pointed out. “If we’re not actually putting in hours, we’re thinking about it or engaged with it. It’s the politics of work that we talk about with our significant others when we go home. [That] takes up a huge amount of emotional and mental space. And that doesn’t have to be a bad thing.” And at Convert, it’s a great thing.

Want to learn more about Holacracy? Check out the website or sign up for an Intro Webinar.

Holacracy® and GlassFrog® are registered trademarks of HolacracyOne, LLC.

Boss-free Remote Work was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

Transcript

Hi, I’m Brian Robertson. I’ve been an advocate of psychedelics and an investor in the space for a little while now. But I’m best known, actually, as the founder of Holacracy, which is a decentralized management framework for organizations that’s spread all over the world. I’m the author of the book on the topic named Holacracy, which has been translated now all over the world.

And the point of this video is actually to share a little bit about Holacracy with those interested in psychedelics, because I think it’s a near-perfect marriage for companies in the psychedelic space. In fact, more than almost any other industry. Let me share a bit about why.

So, Holacracy is an alternative to the traditional top-down management framework that we’re used to. And it’s not that there’s anything fundamentally fatally flawed about top-down management. It’s just, for me, a question of whether it’s fit for the nature of the challenges that companies face.

When management hierarchy was pioneered in its modern form, which was about a hundred years ago, give or take, we had a very different world. During the early emergence of management hierarchy, the vast majority of the workforce was illiterate. And the environment around companies was so static and changed so slowly that things like innovation and creativity were not priorities. Certainly, allowing and harnessing consciousness of people within was not a priority. In fact, it was almost the opposite. The priority was preventing people from using too much creativity and too much consciousness in most of the workforce. We wanted control.

The more we’re able to harness the consciousness of everyone within… the more our company can adapt more quickly, can harness the opportunities it faces.

So management hierarchy came about as a mechanism to get compliance, alignment and compliance, and control. And it actually worked great for the era.

And yet, I think we’re in a very different era today. I think our companies today need something quite a bit different. Creativity, innovation, in most industries is vitally important, as is allowing people to bring their full consciousness into play in the workplace. We sense things. We sense things that could be better. We sense processes that are off. We sense ways to serve our customers better. And the more we’re able to harness the consciousness of everyone within, generally, the more our company can adapt more quickly, can harness the opportunities it faces. And that’s more and more important in the world today.

So we’re not sitting here talking about alternate forms of organization because management hierarchy has failed us. In fact, I’d say it’s succeeded so wildly that it’s helped create a world more complex than it can manage.

And now, in the psychedelic space, I think we’re seeing yet a new level. We’re seeing companies emerge with more conscious people than I think any other industry that I’ve been close to thus far. It attracts them, right? You don’t get into work with psychedelics if, you know, you’re generally liking to stick your head under the sand and stay in a more conventional traditional worldview and not really be mindful, conscious, awake, alive in the world.

Perhaps conventional business structures aren’t the ideal form for the types of industries that are pushing into pretty radical new territory in human consciousness.

I think people attracted to this work, it’s often because they’ve tasted something in their own expansion, in their own spiritual journey or whatever word. And then in the psychedelic space — so you have these kind of people that frankly want more and also offer more. They have more consciousness to offer. And they want to be able to use it.

And if you have a management structure actually designed to, in many ways, prevent it, you can work around that. You can have management hierarchy and still allow people to have more voice, but it’s difficult. You’re working against the structure. And perhaps, conventional business structures aren’t the ideal form for the types of industries that are pushing into pretty radical new territory in human consciousness.

The other issue I see is, often, companies in the psychedelic space have people within who journey together. And I think this creates a really interesting challenge. When you’re in journey space together, often our hearts are blown open. Our resistances are laid bare. They’re stripped away from us. You know, our defense mechanisms, our walls, our resistances. And then our hearts are blown open and we connect. It’s beautiful. I love it.

Except for what happens when people in that state connect with others they work with, but then go back into a traditional structure. And the traditional structure has built into it kind of parent-child dynamics. We have parent-like managers, child-like subordinates. And I’m not saying the people themselves, the structure is built with that kind of baked in. And we have to fight against it to not fall into these dynamics, whether it’s victim and villains or saviors or whatever on the drama triangle, or whether it’s just parent-child. We’re asking our parents for permission and we’re projecting our power on them. Let’s project our power to the boss or to the whole group via consensus-seeking, which slows down a lot of companies and creates a lot of painful meetings.

Or as a boss, we can get attached. There’s a lot of ego hooks in having that power. And a lot of overwhelm too, of sucking up all of everyone else’s power projections. Let alone the dynamics that it creates. Often in management hierarchies, we are incentivized not to be authentic, but to play a — wear a mask, to play a game.

We spend a lot of time in management hierarchies trying to manage our image to look good. And that’s not just because we’re stuck in our egos. It’s because something in the structure actually makes that useful. I could spend an hour talking about that, but I’ll just leave it at that for now. There’s something in the structure that makes that kind of mask-wearing useful. So we don’t bring our full authentic self to play.

But what happens when we do in journey space, and we get used to that? We’ve tasted that. And then we try to do that in our organizations. We have the risk of actually creating trauma. We have the risk of hurting both the individual and the organization in the process, because the structure isn’t designed to hold that level of vulnerability, authenticity, connection, and open-hearted love in an organization.

When we have that kind of clear, broken-up structure, we now have the ability to give people real power, real leadership, in a peer-to-peer structure.

I don’t know about you, but I want to be in a company that supports authenticity and vulnerability, and open-hearted connection and love. And that’s where I think Holacracy is something unique to offer for the psychedelic space in particular. It’s a structure that holds that. That allows people to bring their full consciousness, to lead to their piece.

There’s no management hierarchy at play. You are like the CEO of your roles. It’s a role-based structure. It breaks down work into clear roles for a purpose. It’s a purpose-driven structure. We have a purpose, we break it down into the roles we need. We give each role some responsibilities and some power to go with them, and some boundaries. If you don’t know your boundaries, you don’t know your power. So Holacracy also focuses on clarifying boundaries or limits within which we do need someone else integrated.

And when we have that kind of clear, broken-up structure, we now have the ability to give people real power, real leadership, in a peer-to-peer structure. Adult-to-adult, instead of parent-to-child, boss-to-subordinate.

And yet we also have a meta-process, a governance process, that allows anyone who feels tension, who consciously senses something could be better than it is, to drive positive change, to evolve the structure, the boundaries, the rules, the responsibilities, the policies, processes of the organization, so we can harness the consciousness of everyone within to allow evolution to happen in the way we work together. So the way we work together isn’t just the way things always have been around here, which becomes calcified in most companies, but it becomes a conscious evolutionary process as a result of everyone leading their piece in connection with others who are leading their pieces.

And the result of this is not less leadership, it’s not less structure. That’s people’s, often their misunderstanding when they hear Holacracy has no management hierarchy. But it doesn’t have less structure. It has more structure than a traditional organization. It’s just an emergent structure that’s defined in every team. Every team has this governance process. Every team is an evolutionary entity. And the structure itself is evolving. So we just get there differently. We have more structure, not less. We just get there differently.

And we don’t have less leadership. We have more leadership. We have more, in some ways, autocratic leadership. There are less decisions made with consensus than there are in a management hierarchy. We use a group process to break up and get clear: who leads what? And then we give people the power and freedom to lead within clear boundaries. And a process to come back to as a group to evolve that when we need to.

One of the net results of all this is allowing more love, more authenticity, more connection in the workplace because it’s safe to bring it. We can be adults together. We’re not subject to strange power dynamics like we often are in a traditional management hierarchy. It enables more, it harnesses more, and it offers more for the kind of company that has the kind of worker, the kind of partner, the kind of person building it, people building it, who really can bring that level of consciousness to bear.

So, with that said, you can learn a lot more about Holacracy at holacracy.org. And most people misspell it. It’s spelled H-O-L-A-C-R-A-C-Y.org. Thanks for listening.

Want to learn more about Holacracy? Check out the website or sign up for an Intro Webinar.

Holacracy® and GlassFrog® are registered trademarks of HolacracyOne, LLC.

Holacracy for the Psychedelic Industry was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

This interview was lost in the digital void and just recently rediscovered in a small, dark, unlisted part of our records. It’s never been published on Medium, and we don’t do founder interviews like this anymore. Here’s the article in its unabridged glory—enjoy.

Brian Robertson of HolacracyOne spoke with Phil Caravaggio of Toronto-based nutrition and fitness industry pioneer Precision Nutrition a year after they adopted Holacracy. In early 2012, Phil and his co-founder, John Berardi, were considering using Holacracy as a way to run the company as it grew. A year later, they were self-sufficient with their Holacracy practice and growing quickly.

Brian: What was it like to adopt Holacracy in your business?

Phil: Holacracy has been transformative for me personally and for the company as a whole.

“Probably the best decision I ever made was to step back and seek some help rather than trying to do everything heroically and always be the decider, the leader, and the center of attention.”

Brian: What led you to adopt it?

Phil: About a year and a half ago, we were growing fast, which I’m sure you’re familiar with. It’s a mixed blessing. The company is working, it’s growing and getting big, and we’re doing what we set out to do. And then also, I’m at capacity.

I came to the conclusion that the way I had done things before, which had taken me up to that point, probably wasn’t going to take me any further. In practical terms, I was personally trying to do every new task for our entire company. For example, we didn’t have employment contracts. We realized we had personal data that people had access to, and that we probably needed to put some structure in place.

Of course I was the one who had to do it! I was going to need to find the legal help, and I knew we’d go back and forth, and it would turn into a two-month project. You know how it is — about a dozen of those things will come up in a week that the organization needs to do. Who’s going to do it?

Brian: It all falls to you; I’ve been there. It’s rough.

Phil: It’s probably the same for every person who comes into a small growing company in the early stages. There’s this entrepreneurial spirit; you just do what needs to be done. It’s all well and good until it isn’t, and it just stops working at a certain point.

The dilemma was: how do we maintain the spirit of this entrepreneurial company that set out to do things differently than all the companies in our field, and in some ways, all other companies in general. How do you do that?

Brian: Yes. What was it that stopped you from just taking the conventional approach? Why not hire managers and put a typical hierarchy in place? Why were you looking for something different?

Phil: I think it was a sense that this company is my life’s work. I guess that all work is someone’s life work, and so, how are we going to treat it? I already knew, having worked for some large successful companies that that wasn’t very prized in those places.

I guess I had some fundamental distaste for commodity or transaction work, “Here’s your paycheck. You do what you’re supposed to do.” That’s the transaction: “Here’s the money, here’s the work,” and that’s as far as it goes. It sounds great in principle as sort of a theoretical concept: you get paid and you do something. In practice, it just doesn’t work that way. It’s sort of disheartening on a really fundamental level, and I felt that personally. I knew I could never work in an organization in which that was the deal. I knew that our other co-founder, John, could never do it. Everyone on the team had that same aspiration for something else.

We had that “something else” in the early stage: I get to do what I love, I get to have some say in shaping the work, and I’m adequately paid. I can do great work. My work is respected. How do we grow while still making this a place where each of us can do our life’s work, not a place where each of us can get a paycheck to finance a meaningful life outside of work that you have to check at the door when you come in? That’s what I was looking for and that’s what I think we actually found.

In the adoption of Holacracy, John and I looked at each other and said, “Okay, here’s the possibility to do that on a larger scale than we’ve done before.” If we wanted to just artificially constrain the company to be small, which other companies have done — for example, “We’re only going to have six people” or “We’ll grow only to this point” or “We’ll focus only on this small thing” — we wouldn’t have to deal with the dilemma of maintaining the spirit of the organization in the midst of growth. But we thought that would feel like a missed opportunity.

What if we could maintain the spirit of the organization along with the growth? We felt that Holacracy was the framework in which to do that.

We knew it was still going to be hard, and that we’d have to get up every day and recommit to this and make sure that we didn’t just make a BS attempt at it.

Brian: Yes, I get it. If you haven’t really committed to Holacracy, if you’re just kind of playing with it, it doesn’t have the impact.

Phil: Yes. I feel like what we’ve gotten out of implementing Holacracy is that opportunity, and it’s done a lot of amazing things, but I think that’s the main one: how do you maintain the spirit of an organization, the DNA of the organization, in the midst of growth and forces that work to formalize it, and in formalizing of it, threaten to stamp it out? You’ve got new customers, new growth, and new markets expanding, and new people wanting to work with you. How do you maintain the spirit with those positive forces knowing that they also can carry a negative side?

Brian: What are the results as you’ve stuck with it and maintained the discipline of Holacracy? If there’s one company that should be able to maintain discipline, it seems like it’s Precision Nutrition, given what you do. That must take more discipline than Holacracy!

Phil: It’s tough and it’s rewarding. I think that’s the valuable part of it — everything you do in work is going to be challenging, and the question is, what’s the payoff? It’s allowed us to grow. When we first started toying with the idea of adopting Holacracy, we were 25 people and millions of dollars in sales. We’ve grown, in both people and revenue, somewhere between 25% and 50% every year since our inception. Then something just felt like it wasn’t going to work anymore, like there were things duct-taped together. The burden was too high for me, and for our other co-founders, and for all the people who were in the organization at that time.

Holacracy has propagated leadership throughout the organization, not in the managerial sense, like you’re the manager so now you technically lead a group of people. It’s given people a say in the governance and tactical meetings, and just in general knowing who does what and having a framework for resolving tensions.

It gives people a chance to shape the work they do, which I think is the fundamental thing that’s missing in the old hierarchical style of working, where it’s just simply impossible to shape the work that you’re doing without doing an end-run around the structure entirely. You see that organizations that do it well have a hierarchical structure and then a skunkworks break off. The old ways are not going to allow us to innovate or shape the work we need to do.

Holacracy has allowed us to make the whole company kind of a skunkworks. Here’s how we can rapidly adapt based on what people are actually seeing and doing on the frontline.

For example, if people feel like the sort of reporting process that we have to do kind of sucks and is slowing them down, they can just propose a change. This opportunity happens once a month in governance meetings, and more frequently than that if necessary. There are many pathways to resolve tensions. That’s so woven into the fabric of our company now that I think the whole organization is agile. The whole organization in its DNA is now built to adapt. That’s the biggest payoff, because that gives me some sense of confidence about going forward for the next three to five years. We can grow this thing while maintaining the spirit of the organization, and not throwing that out the window.

How do you manage the tension between keeping this core of what made the organization special in place, while at the same time adapting to the ever-changing reality of the world outside the organization? I think Holacracy is the framework to do that.

In practical terms, we’ve grown at least at the same pace we were growing before, with one fundamental difference: I now feel like the organization can keep going without requiring so much from me! Since we started the organization in 2000, I’ve never been able to take a real vacation. Last September, I took three weeks off in the middle of probably the most profitable product launch in the history of our organization. I don’t know what that says about my personal contribution, but I think what it does say is that the organization has grown to the point where it is its own thing. It is something that can grow and shape itself. The early adopters of the organization, the people that were there in the early stages, can make valuable contributions to it but they’re no longer the essential game-breaking components upon which the whole thing rests. I think that’s been a huge change.

Brian: That’s awesome. What was the biggest challenge for you personally in the adoption process? Where did you find yourself having to change habits or patterns? Where was it challenging?

Phil: I think the most challenging part of adopting Holacracy for me personally was simply learning to let go. I know that’s become a cliché, “Let go, let go”, but in practice, where the rubber meets the road, is when you have something you’ve always done that is part of who you are, and not just part of the job you do, and you step back and let someone else do it in their own way, possibly forever more — whether it’s a particular role you served in the organization, or part of a role with an area of focus. You just simply say, “You know what, this is for someone else to do.” Just letting go of entire chunks of the organization and allowing other extremely capable people to take that on is the hardest thing to do. It sounds trivial because it’s something that I think you’d imagine every organization has to face as it grows. But in some organizations, they really don’t face it.

There’s a sense that only the people at the very top have the final word on everything. That’s very different in Holacracy. There really isn’t a top. There are different perspectives, and they’re not necessarily hierarchical.

I can’t say “I’m a founder of the organization, so no matter what part of the organization we’re talking about, I’m the final word on it. I get to decide.” That’s not the way it works. That is a fundamental difference in Holacracy. This is an opportunity for people in every area of the organization to have not just lip-service authority, but genuine authority. That took a commitment from me. I think the hardest thing to do is make this mental shift. Other people are going to have genuine authority. They will be the authority, not me, on X, Y or Z. I will be subservient to them in these various functions.

Those are things that don’t come easily, and I think what Holacracy did is enforce or sort of make it really obvious when I wasn’t doing that. There’s always a way to try to do an end run around it, but what Holacracy does is shine a light on it when you’re doing it.

Holacracy forces people to yield to the authority of others, and the payoff of doing that is the opportunity to have real authority over your own work in the places where you can be the most valuable to the organization and make the biggest difference.

Brian: Hearing you talk, I could be talking about my own experience with it too. There’s something about founding an organization; it’s such a creative act, and there are forces that just crush it. If something is able to protect it and help you differentiate from it so that it stands on its own, so that not even you can kill what you’ve created, and the specialness of it, there’s something kind of cool about that.

Phil: In the midst of this whole startup culture, that’s what no one tells the entrepreneur. You can actually kill your own specialness, and you probably will, unless you go out and solicit some advice from people who have done this before. I think that’s what you’re onto here, by giving people a framework in which to do this. It gives you, as the custodian of that specialness, enough to keep it. You’re not going to delegate that part of the organization. As the founder, that’s my primary role and task: “How do I keep that?” Someone else is going to help you with the rest; someone else has to develop that authority, and Holacracy is what can foster that. In the last year and a half, we’ve seen so many people take on real leadership roles in the organization. That was never the case before.

When it comes down to it for me personally, I’d say Holacracy is a life-changing thing. I don’t think that’s overstating it. I came to your one-day workshop in New York on the recommendation of someone whose opinion I trusted. I left thinking that we need to seriously look at this, because this is a fundamental problem, the idea of how can we function in the modern world. The old ways aren’t going to work anymore. Everyone knows it, just like you know in your heart of hearts; the world can’t go backwards. We can kid ourselves and pretend, but in practice, you know when you come in to work on Monday morning at 9:00 that you’re doing something that just doesn’t feel appropriate anymore. There’s something amiss. I came out of your workshop thinking that you people have thought about these matters a lot more than I have. I felt Holacracy was something worth experimenting with, and I’m glad we did.

I’m very grateful to you guys for what you’ve done, because it has made a big difference not just for me personally but for the organization and for the people within the organization. I think they get it. First, it was like, “What is this?” “What the hell are they talking about and what am I going to do now?” Then later, they realized, “Oh, okay. I can’t claim that I don’t have a say in this thing because I obviously do.”

Precision Nutrition’s journey to Holacracy and the impact it had on their company was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.

Exploring Self-Management as an Organizational Structure for Startups

This article describes how startups can better respond to the need for more organizational structure by knowing real alternatives to conventional hierarchy, and when to make a deliberate operating system change.

For most startups, there are obvious stages in their development where fundamental decisions need to be made. In the beginning, founders may meet at university or get together with friends to explore a business idea. After a period of experimentation, those who do not fail in the early stages (which is most startups) will reach a stage where the product-market fit increases.

How do you know if this is already the case? Quite simply, the fact that this question is being asked at all means that the optimal market fit has certainly not yet been achieved. Because once it is, there is an unmistakable pull of the market that runs through the entire organization, ensuring that there is rapid growth to meet demand. Organizations in the growth phase are more likely to die of constipation than starvation. There are too many opportunities and there is a risk of biting off more than the organization can chew. The team needs to grow in a relatively short period of time to keep up with increasing demand.

“Help, we need structure!”

This is where startup founders enter a common dilemma: As the team grows, so does the complexity of the organization, and it becomes clear that some kind of intermediate hierarchy is structurally required. At the same time, this calls into question the basis of the company’s previous success, its agility, its interpersonal closeness and looseness, and the feeling of being part of a self-chosen family.

But not wanting to have a problem ultimately doesn’t solve it. “What the heck, in the end, we don’t have a choice anyway — so bring on the full-time leaders, managers, ‘head-of’s’, etc.”, you pragmatically tell yourself as a founder, and let fate take its course, while you swear to yourself that you will practice “servant leadership” and other lofty leadership ideals, and never let yourself be seduced by the dark side of power. Good luck!

A Choice That Is Not a Choice

Strictly speaking, the decision in favor of the classic management hierarchy is not really a decision, because a “decision” assumes that I can choose from at least two viable options. Letting the organization slide into hopeless chaos is not a viable option, however, and so most startups are left with the motto “close your eyes and get through it” and impose the unloved management hierarchy, with all its interpersonal entanglements, and hope that everything will work out in the end.

The good news is that there is in fact a viable alternative to the classic management hierarchy. It is called self-management.

The good news is that there is in fact a viable alternative to the classic management hierarchy — and therefore there is a real choice to be made, provided that one is aware of this alternative. It is called self-management, or self-organization, and it is gaining visibility in the mainstream. But unfortunately, the majority of companies are still relatively ignorant of this alternative or do not (yet) dare to break new ground.

A Real Alternative: Self-Management with Holacracy

The variant of self-management we favor at Xpreneurs is called Holacracy. It’s a robust peer-to-peer practice of distributed authority without traditional managers, developed in 2006 by Brian Robertson and the company HolacracyOne, and now practiced in thousands of organizations worldwide. The rules of this practice are codified in the “Holacracy Constitution.” The goal of this article is not to explain Holacracy (you can read about that elsewhere, like in the Holacracy blog), but to highlight the fact THAT a realistic alternative to the classical hierarchy does exist, for or against which one can make an actual meaningful decision. This makes the classical management hierarchy no longer without alternatives, and the decision a real choice between two viable options.

The Problem of the Right Timing

Assuming that Holacracy-style self-management is seen as the right choice, when should the alternative operating system be introduced in the organization? One can roughly distinguish three phases in a startup’s growth:

1) the naive early days when everyone is part of a Happy Startup Family;

2) the phase when the product-market fit has been optimized, leading to a growth spurt and increased complexity; and

3) a consolidation phase when the organization has to structurally digest its growth (if it doesn’t want to perish from constipation).

Phase 1: Happy Startup Family

In phase 1, there isn’t usually awareness that the growth spurt in phase 2 will come and lead to a need for structure. People think they can work together forever in the garage with friends as a Happy Family. Although it would be ideal to build the organization on a sustainable foundation with a Holacracy operating system at this early stage, other things are more likely to demand attention:

• Verify the hypothesis that the organization’s products are needed.
• Develop income streams to have a financial runway long enough to bring a product to market.
• Get the right people with the right skills on board.

In phase 1, the need for self-management is not high, because you are still working well with your colleagues at eye level (and all needed tasks are being done), and there are not usually enough financial resources to get thorough Holacracy training and professional mentoring (though there may be exceptions). So this is not usually the right time.

At the same time, there are substantial benefits being missed. As soon as the questions arise as to what work actually has to be done, who is accountable for what, and who makes what decisions, one would have the opportunity to make these decisions using Holacracy. Most startup founders unconsciously and unintentionally create a practice that will later harm the organization, and from which they have often tried to escape by, ironically, creating yet another company.

Phase 2: Market Maturity

Even in the market maturity phase (2), by definition a turbulent phase, a radical change in the organizational operating system is not recommended because such a change requires an investment of time and attention. However, this is not viable here, because the phone doesn’t stop ringing. In addition, the sudden increase in complexity only becomes noticeable toward the end of this growth phase, which means that the structural deficit will suddenly become acute. And so this is not usually an ideal time either.

But from another perspective, this is the first real stress test for the company. If you can already build on solid self-management practices from the early stages here, there will likely be significantly less collateral damage.

Phase 3: Consolidation

In phase 3, you have mastered the first rush of customers and recognized the need for structure. At this point, most founders choose the path of classic management hierarchy. But, as we have learned before, there are other paths available: it is also possible to follow the lead of a growing number of pioneering companies from all over the world in the direction of self-management. In phase 3, you have sufficient resources, you have a working product, and you know that a suitable organizational structure will not build itself. From this plateau, you can either passively drift along with the flow of traditional hierarchy, or you can completely rebuild your organization with self-management.

Conclusion

If you value startup qualities such as agility, decentralized decision-making, maximum autonomy, and working at eye level and want to scale, but don’t want to forgo role and process clarity, a consistent self-management system such as Holacracy is an option to seriously consider in the last consolidation phase.

However, if you consistently think ahead, you will consider the question of system selection from the very beginning, because it will inevitably arise on its own. The earlier you practice alternatives, the easier it is to establish a new pattern of collaboration that can ultimately withstand changes in the organization (e.g., consultants, new colleagues, VCs) — without responding purely reactively to the need for structure by establishing a management hierarchy because “that’s just how a professional organization works.”

To the contrary, the traditional management hierarchy is not a fate that one has to endure. But you can only make a real decision when you know real alternatives.

This article was first published in German on Feb 9th, 2022 under the title “Selbst-Management als Organisationsstruktur für Startups” on the Xpreneurs blog.

Get Started with Holacracy

To learn more about Holacracy, find practice resources, or connect with a coach, visit Holacracy.org.

Choosing Your Startup’s Operating System was originally published in HolacracyOne Blog on Medium, where people are continuing the conversation by highlighting and responding to this story.