Holacracy, Flat Hierarchy, and You

subtitled; Knowledge Workers are still Workers


I will start by warning you that this is a fairly long piece for this blog, and earnest. You’ll find no animated GIFs beyond.

What I Read to Get Here
I recently read a pair of articles, one about Medium’s internal structure, and one about the new internal structure at Zappos. This is interesting because both of these companies are signing on for a new idea; Holacracy.

I’ll be referring to both of those articles and the Holacracy site and wiki. I’ll try to use quotations liberally so that you don’t have to read those pieces if you don’t want to – I’ll keep them in context, and I won’t try to make the quotes say or mean things that they don’t. Even so, for the full picture, you should read at least the two articles yourself.

The Holacracy web site describes Holacracy like this:

Holacracy is a comprehensive practice for structuring, governing, and running an organization. It replaces today’s top-down predict-and-control paradigm with a new way of achieving control by distributing power. It is a new “operating system” that instills rapid evolution in the core processes of an organization.

In the article about Medium’s use of Holacracy, Jason Stirman describes their structure:

“The structure is totally built around the work the company needs to achieve its purpose. We don’t have a hierarchy of people, we have a hierarchy of circles.”


“The difference between Holacracy and traditional management is that when you have people at the bottom and people at the top, it’s always the people at the top trying to figure out their tensions, then they have the people at the bottom resolve them. No one takes into account the tensions, ideas, issues felt by the people at the bottom. They spend their days resolving tensions they don’t have and may not even understand.”

And here, a quote from the article about Zappos’ transition to Holacracy:

“One of the core principles is people taking personal accountability for their work. It’s not leaderless. There are certainly people who hold a bigger scope of purpose for the organization than others. What it does do is distribute leadership into each role. Everybody is expected to lead and be an entrepreneur in their own roles, and Holacracy empowers them to do so.”

As someone who works for Automattic, a company that follows a similar (though less defined and unnamed) structure-through-no-structure sort of approach to the corporation, I feel qualified to discuss these ideas – and my background as a community organizer, operations manager, and occasional radical allow me to feel like my perspective is at least valid.

How great does Holacracy sound? On the face of it, it sounds like the IWW became a 21st century startup whose founders all read (and bought into!) both Greenleaf’s Servant Leadership and the Toyota Production System. A well lead, efficient organization that solves problems, hires go-getters, and listens to everyone.

A truly flat hierarchy, with fully distributed leadership (which means power, right?) and mutual respect for all involved, strikes me as the ideal balance between productivity, worker dignity, and the pursuit of value – or, more crassly, profits.

The thing is, that description, which makes my rebel heart skip a beat and makes me feel hopeful for the future of the knowledge worker in America, is not a description of Holacracy. Nor is it a description of my company, or really any modern company that I know of.

Things I Agree With
In the article on Medium, Stirman describes traditional management like this:

“Management perspective looks at reports as resources — like how can you get the maximum value out of this person. But when I think resources, I think like natural gas or coal mines. Thinking about a person’s life that way just seemed really dehumanizing.”

He describes traditional management in that vein; he learned (through books and mentorship) to insulate his team from some data sources, to avoid being friends, etc. What Stirman describes strikes me as an antiquated notion of management (and leadership) – he clearly never read Managing Humans, Michael Lopp’s outstanding book written to address the problems of old management styles in today’s workplace. I agree with Stirman in that these old approaches to management don’t work, and it’s time to put them to bed. This isn’t 1956, we don’t work for IBM. Let’s move onto leadership, and out of old school, sage-on-a-stage style management.

From the Holacracy web site:

With Holacracy at play, if an expectation isn’t explicitly defined via a governance process, no one has a right to expect it.

Yes. Yes, one thousand times yes. I wrote about the importance of clear expectations in 2012 and this is still a problem in many companies today. Remember: expectations and feedback are two sides of the same coin. You cannot effectively use one without the other, and complaints of poor feedback or lack of feedback many times can be traced back to a lack of clear and well understood expectations in the first place.

Also from their web site:

Holacracy places the seat of organizational power in an explicit process, one which organizes around an explicit purpose.

This resonates really clearly with what we’ve learned about Zappos through the years, right? What really stuck with me from Delivering Happiness was what a good job Zappos did when it came to naming their values, and then publishing those values, and using them not just as a publication but as a true touchstone and guiding star. This really runs parallel to the clear expectations piece: if you don’t say it, and mean it, then it isn’t real. It isn’t useful. An explicit purpose is a wonderful thing, and can act as both a barometer and a lighting rod for talent.

Hsieh is quoted in the Zappos piece, saying;

“There’s the org chart on paper, and then the one that is exactly how the company operates for real, and then there’s the org chart that it would like to have in order to operate more efficiently. … [With Holacracy] the idea is to process tensions so that the three org charts are pretty close together.”

Again – transparency of structure, trying to tell the whole story honestly, at least internally. These are pieces of Holacracy that I can totally get behind, and really think represent a step forward in the way that we do business and organize our business structures.

Things That Concern Me

Medium describes one of their Holacratic tenets as such: “No people managers. Maximum autonomy.” This strikes me as a holdover effect, a lingering distaste that we all have for management when we consider how poorly it’s done in so many cases. Modern management, executed by people with vision and talent, in fact makes for more autonomy, and more productivity. These two ideas, management and autonomy, are not mutually exclusive, and pretending that they cannot coexist is not helping anyone.

In the piece on Zappos, Holacracy’s model for tension resolution is considered, and this point is presented:

“For example, if you’re a junior designer, Holacracy says that you should bring up everything in this forum, but it can be difficult to ask for feedback or mentorship, especially when you’re new.”

This is worth sitting with for a while: if you feel tension in your workplace, or if you feel things could be done better, or even differently, who in your company would you be comfortable discussing that with? Your peers? The CFO? The CEO? There exist tensions within an organization even with a structure like Holacracy, and these tensions are what really make me uneasy.

Here’s the thing: I really like the sound of Holacracy. My inner manager and leader see the benefits, but I can feel in my bones the reservations of generations of Welsh immigrant coal miners, inspired by John L. Lewis (the L. stands for Llewellyn!) to organization and unionization. The history of workers in America makes me a bit skeptical about this idea – I can hear them now: “Neat trick!”

They see this structure as a trick because it strikes them that way – it sounds too good to be true, and anyone who’s been fooled before (rightly!) gets a refined sense of skepticism. After all, even as the responsibility and the hard work of ownership and accountability is spread throughout a company, is the corresponding compensation similarly spread? The Holacracy Wiki: “Holacracy doesn’t answer that question.”

The idea of a flat hierarchy is an inspiring one, and is something that radical labor movements have been fighting for for almost a century – but as I mentioned above, Holacracy is not a flat hierarchy – they say so themselves. It’s described as a hierarchy of roles, and not people. In this sense, even a traditional corporate structure is a hierarchy of roles – but I digress.

It is not hard to see my ancestors’ perspective; the work of leadership, accountability and decision making are empowering, and they are difficult, and for a long time now these have been the exclusive properties of executive and upper level management positions, positions which traditionally have salaries considerably larger than that of the rest of the organization. So, then, if the properties of the traditionally highly-paid positions are being redistributed to the rest of us, so, one would imagine, should the benefits of those properties. Are they?

OK, one animated GIF:

I like the idea of Holacracy; I like the way things work at Automattic even more. I would love a chance to step inside Zappos or Medium for a week (or month!) to see how it works on the ground.

That being said, there are two stories here, and holding up a new corporate structure doesn’t change its fundamental function – to enrich a few using the labor of many. There’s no shame in that, and on some level we’re all made better off for capitalism’s existence – but let’s be honest with ourselves.

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