Holacracy? What is it?

A holacracy is a system of corporate governance in which members of a team or business form distinct, autonomous, yet symbiotic, teams to accomplish tasks and company goals. The concept of a corporate hierarchy is discarded in favour of a flat organisational structure where all workers have an equal voice while simultaneously answering to the direction of shared authority.

How does Holacracy work?

In a holacracy, instead of hiring a person to fill a pre-defined role (such as that outlined in a job description), people opt to take on one or more roles at any given time and have flexibility to move between teams and roles if they have skills or insights that would prove beneficial to the organisation.

Holacracy wants to get rid of the top-down management and gives individuals and teams more control over processes.

The difference between Holacracy and Traditional Hierarchy

Arthur Koestler, the author of “The Ghost in the Machine,” came up with the term holarchy as the organisational connections between holons (from the Greek word for "whole"), which describes units that act independently but would not exist without the organisation they operate within.

Brian Robertson then improved the concept and dynamics of holacracy. HolacracyOne was founded in 2007 by Brian and Tom Thomison, with the Holacracy Constitution published in 2010. Companies such as Valve Corporation and Zappos.com adopted the holacracy system.

Example of Holacracy

The video game software company Valve Corporation, who is behind the video games platform Steam, adopted the holacracy system.

At Valve, employees are encouraged to work on whatever interests them, but also requires that they take ownership of their product and any mistakes they may make along the way.

Experts criticised that this structure works well for some but that there are plenty of great employees for whom this type of organisation is a terrible place to work.

Holacracy in a nutshell

• A holacracy is a system for running a company where there are no assigned roles and employees have the flexibility to take on various responsibilities and move between teams freely.

• The organisational structure of a holacracy is fairly flat with limited hierarchy.

• The structure, which has a set of guidelines laid out as the Holacracy Constitution, works fine for some but can be a bad fit for other employees that will otherwise be excellent in a system of hierarchy.

Myth: Holacracy gets rid of corporate hierarchy?

Experts said that holacracy as a corporate management policy does not mean the end of the corporate hierarchy.

Hierarchy is still an essential component of holacracy. In fact, hierarchies and the inflexibility it creates in different employees’ roles may be more noticeable in holacracy.

Looking for Non-Executive Staff? AJobThing.com is your top choice to hire quickly and efficiently. Try it today!

Source: Investopedia

Related articles

Performance Appraisal: Doing it Right

The Different Types of Turnover HR Must Know

Why Employees Quit: What HR Should Know