The Holacracy Episode 4

The informal structure of power is one of the hardest things to change in the company. There is always someone with a formal power or extraordinary charisma that is more heard than others. In this post, I’ll explore how Holaracy helps to change it through clearly defined roles and processes.

In a workplace, with a traditional, hierarchical structure the board or your manager makes all the important decisions. It’s the position that determines your level of authority: the higher you are, the more decisions you can make on your own. And as almost always there is at least one (or more) management level above you, you have to go through an utterly inconvenient approval process, which is a clear manifestation of lack of trust in the organisation.

At Tooploox we never had managerial levels. Developers always had a fair amount of freedom in tech-related decisions and we did some high-end chaos management when dealing with most of the issues related to the organisation itself. We grew organically (aka without a plan) and as a result, the amount of chaos was increasing, especially in the area of responsibilities. In other words, it wasn’t clear which decisions could be taken without the founders’ approval or when we should ask the entire company for opinion (consensus!).

How to deal with the real structure of power?

It is a daunting task to kill the old, informal structure of power and transfer decision making to each individual. Tooploox founders were involved in most of the company discussions and often had the last word before any significant change was made. One of many advantages of Holacracy is that the concept of autonomous roles and the fixed process help transform the power structure. Here is how.

Roles

Holacaracy is a bit like a role-playing game: every person in the organisation has a role (or set of roles) and while at work you always act “in your capacity as a role”. Each role has its unique list of accountabilities and is given full power to act as they see fit within these areas. Sounds like a lot of freedom, doesn’t it? There are some guidelines, though: the strategy of the company is defined by the General Company Circle and all roles should align with it. The power that is given to each role is based on the assumption that people are experts in their jobs.

Rules

Here is another resemblance to a role-playing game. You need to get familiar with the rules in order to play it right. There is a set of rules dedicated to decision making. First of all, when it comes to decision making there is a procedure that is a procedure that stops people from doing anything that may harm the organization. However, in order to raise an objection and block anything, you need to prove that this particular action will be detrimental results. The testing process checks if that’s really the case:

It was very surprising for us to see that the vast majority of our objections were not based on a certainty that some harm will happen, but on a fact that we perceived many ideas as incomplete and imperfect. And Holacracy is not about getting a perfect version at a first attempt; it’s about testing ideas in practice.

There are other rules that we’ve found useful in killing the old power structure. Each meeting has a fixed order that strictly specifies who is allowed to talk, ask questions and finally make a decision. The most important person is the one that brings a problem (tension) to solve, regardless of the role they fill. Following the process helps to cut unnecessary discussions, reduce the impact of charismatic people and focus on problem-solving at a role (as opposed to personal) level. Thus, when the personal level is eliminated from the meeting, so is judgment and the power structure.

The next big step for us is to overcome the urge to reach consensus and use feedback in order to get more insights and a view from different perspectives. We need to work on efficiency in our circles and introduce Holacracy to the rest of the company into Holacracy. These tasks will be tackled by our new Transformation Circle, which we’ll cover in the next episode of The Holacracy series.