What is Holacracy?
Several high-profile organisations place holacracy at their core. But what exactly is it, and what are the advantages and disadvantages of the ideology it represents? We’ve put together a guide to this system of organisational structure that embodies decentralised management.
What is Holacracy?
Holacracy is an organisational system that exemplifies decentralised administration, in which units or teams operate autonomously to achieve company-wide goals.
Instead of a traditional hierarchical organisation in which authority and decision-making are centralised at the top, a holacratic organisation uses a holarchy, with the aim of dispersing decision-making and innovation authority among self-governing teams. Generally speaking, holarchy refers to autonomous teams and their interconnection.
Technically speaking, the term holarchy refers to the relationship between holons, which are a whole in and of themselves and form part of a larger whole (an organisation, for example). It pertains to teams within an organisation that are self-governing yet integral to the building of the organisation.
Furthermore, everyone in the firm, from the CEO to new employees, is subject to the same set of regulations under the holacracy structure.
How Does Holacracy Work?
A holacracy operates by enabling each employee to take on many jobs and fostering flexibility and fluidity within those roles based on the demands of the firm. Team members have equal power, and people utilise their own judgement to select how to complete tasks and goals without being directed by a supervisor.
The Benefits of Holacracy
The advantage of holacracy is that it’s believed to allow team members to freely submit ideas, similar to how meritocracy functions. It is feasible because personnel at all levels are independent and allowed to debate ideas they feel would improve the firm.
In addition to the concept of meritocracy, holacracy provides fewer levels between consumers and staff; it is said that such a structure allows for faster decision-making, which enhances customer happiness.
The Disadvantages of Holacracy
Implementation is difficult in huge enterprises. In other circumstances, massive sums of money must be spent on re-training. Some management methods get ingrained in business culture and are difficult to change.
Accountability is lacking. Loosely defined jobs in a holacracy, along with a lack of distinguishing performance requirements, make it more difficult for HR departments to assess employee capabilities.
Inability to concentrate. The emphasis on collaboration might result in confusion and a lack of focus. Decisions may be argued indefinitely, resulting in wasteful work practices and the incorrect decision being taken. Furthermore, some people have skill sets or dispositions that lend themselves well to independent work.
Takeaways:
A holacracy is a non-hierarchical governing organisation defined by self-organised groups with equal authority and voice.
Through open communication and flexible work habits, a holacracy allows people to become more committed in their professions. This builds company culture and helps a firm to achieve its objectives.
A holacracy fosters a focused and adaptable staff that knows what is expected of them. It will, however, be unsuitable for huge enterprises with well-established cultures. Employee performance might suffer as a result of an emphasis on cooperation and loosely defined positions.
Are you ready to redefine how your organisation operates?