What is holacracy and why you do not need it

    Holacracy will soon become the new fashionable buzzword in the world of IT business , which at one time startups, agile and lin became. An incredible hype has already risen in Silicon Valley: companies of the level of Medium , Zappos and Airbnb are implementing Constitution 4.0 with might and  main, there are forks and alternative systems, a lot of misconceptions, speculation and criticism are born about this model of distribution of power. Soon the trend will reach our northern latitudes and will cause even more misunderstanding due to translation difficulties. Let's get ahead of events and try to figure out what holacracy is, where it came from and what benefits it can bring.



    ButtonIt serves entrepreneurs, and it just so happens that we always need to be a little ahead in order to offer the coolest solutions. Therefore, we love to try everything new. We started experiments with holacracy several months ago: we got the first bumps, talked with consultants from the USA, felt the first improvements and continue to introduce and study. In the first article we will tell you about the basic things that are important for understanding, and in the next we will share our own experience and answer popular questions.

    Big and small


    IT companies are conditionally divided into two camps: large corporations with a bureaucracy level close to classical business, and young startups with a flat organizational structure, for which mobility and informality in decision making is the only way to survive. Of course, these are extreme degrees, and there are many intermediate states, but for a better understanding we consider the problems of these particular organizational structures.



    The main problems of large companies are bureaucracy and strict hierarchy. In this situation, employees are limited by the job description and the will of the manager, over which there is a couple of managers, CEO and board of directors. Any decisions are made either incredibly long, or bypassing the rules and regulations. The rights and obligations of each employee are reliably secured by the job description, which rarely hassomething in common with reality. This leads to absolute opacity and erosion of responsibility - there is no understanding who is doing what and who to ask what for. CEO painfully motivates CTO, CTO calls the project manager on the carpet, he blames the product-ooner for everything , then the team goes to the team leaders and ordinary developers. Everyone is to blame, but who corrects this is unclear.

    In startups with a flat structure, everything is different. As long as you have a dozen and a half employees recruited on the basis of the "burning eyes" and "willingness to work for food" principles, you do not need a hierarchy, a division of responsibility, and  anyregulations. Your task is to work 146 hours a day and do everything that comes to hand. Transparency is achieved through daily rallies and continuous colaboration. The pluralism of opinions is nullified by the number and common idea, less often by the firm will of the founding visionary , decisions are made quickly and immediately go to work. You have a chance to stay forever in this beautiful moment, but sometimes the time comes to grow. A flat structure in a company with 50 employees is worse than any tyranny.

    If you want to maintain freedom and mobility without slipping into continuous discussions, mail ping pong, compromise solutions or other extremes, holacracy can throw a couple of useful ideas. Let's say right away, holacracy is not a silver bullet, it gives one answer to almost all questions: "It depends." So what is it all about?

    Sim City inside the company


    Holacracy creator Brian Robertson faced these problems when he left a large company and started his own business. Work in the corporation prevented self-realization, and managing a growing startup was becoming increasingly difficult. Brian began experimenting with different approaches, changing the structure of the organization and distribution of power. All this research prompted him to a household metaphor. While reading, look at the picture and imagine this good-natured speaker:



    Any black-black city ​​has a black-black mayor or a city ​​manager who solves global problems, someonemanages individual districts, there is house management and several more levels of hierarchy. In this case, the mayor, the head of the district administration, the head of the Ministry of Internal Affairs and the landlord can not give orders to the tenant of a particular apartment. They cannot indicate where he should work, what time to wake up and how many times a day to brush his teeth. The man himself makes the decision to purchase furniture and eliminates the problems in his segment of space: repairs plumbing, equips life, makes money. There are certain limits of possibilities: your decisions and actions should not interfere with other people and spoil city property, or the benefits of their use should be higher than the damage done.

    There are also processes that allow you to bring the problem outside of your apartment: go to the neighbors for salt, ask the house administration to fix the elevator, persuade the district administration to patch the asphalt or challenge the city budget at a meeting in the city hall. In an ideal spherical city, a self-organizing distributed power structure appears, which makes it possible to influence the development of the system and its individual parts, while maintaining personal responsibility for their own well-being. Moreover, the larger the city, the higher the personal effectiveness of each unit - a district, house, apartment, person. Why not take this approach in business?



    From this powerful metaphor the idea of ​​holacracy was born. A company is a city, a CEO is a mayor, departments are districts, inside departments are houses and apartments. All play according to the same rules, are endowed with equal rights and duties and can influence each other only indirectly.

    Ordered chaos or head spinning


    Holacracy is a way of decentralizing power, which allows you to build a hierarchy (holarchy) in such a way that every employee can influence the life of the company and have full power in the framework of its role and the expectations assigned to it. Holacracy is not managed by management, but by the overall goal of the company, the transparent process, expectations and metrics. At the same time, formally, you do not have bosses, but any person in the company has the right to know what you are doing and how efficiently you are doing your job.

    With the introduction of holacracy, the company is divided into circles. It looks a little silly and, at first glance, changes only door signs: departments and departments become "circles", employees turn into "roles", and the organization becomes one huge "anchor" circle, which includes all circles and roles. It looks something like this:



    However, a big idea is hiding behind the screen. Let's look at the standard hierarchical model in which the directorate extends its sharp tentacles, overthrowing the will to departments and specific people through middle-level vassals:



    In holacocracy, everything looks a little different: each circle has a tentacle of power, be it a supercircle or a subcircle. These tentacles even have special names: lead-link and  rep-link(otherwise - the lead contact and representative): The



    lead-link  - the top-down tentacle  - is a specially trained role, which has several responsibilities: deliver information from the outer circle to the inner circle, determine the roles that are needed inside this circle, and if necessary, combine the roles into subcircles , appoint (and remove) the roles of certain employees, except in cases where the appointment to the role is determined by elections. If not all the roles in the circle are staffed with the right people, the lead link takes on the role of this role . The lead link itself is assigned by the external circle. There are lead links in supercircles and subcircles. If in a nutshell: lead-link - this is a person who acts inside the circle on behalf of the outer circle, a sort of manager with a crown down.

    Rep-link  - bottom-up tentacle  - a role that represents the interests of the inner circle in the outer. He accumulates the questions, problems and proposals of the circle and brings them up for discussion in the external circle, at special management meetings (governance meetings). They do not become rep-links - the circle itself determines the representatives by simple voting. A lead link cannot also be a  rep link (with one exception), otherwise the whole system will break. Rep linkshould not behave like a union, promoting the interests of its own circle only, it should well understand the goals and objectives of the supercircle and the whole company, otherwise the whole system will break. In other words, the rep-link  is the ambassador of the circle, making dirty linen out of the hut.

    It turns out that in a holarchy, information does not fall from heaven to earth in the form of directives and does not move randomly between all participants in the process. Suggestions, solutions and questions move freely along pre-laid paths and fall into the tenacious hands of those for whom they are important and those who are simply interested. The holarchy is not directed from the bottom up , but works in both directions through ordered channels. In fact, the role of a manager is played by a process that does not ask for money and is not biased towards you.

    The main role for everyone


    And what is the role? This is a set of functions assigned to a person (if not to show off, then just a position). By the way, the circle is also a role, just so vast that it can no longer be performed by one person. The role has a kind of job description. One difference: this instruction is formed on the basis of the expectations and the overall goal of the company, and not out of a desire to limit the rights and opportunities of a person. One and the same person can occupy different roles in one or several circles, and if he cannot cope with one of the roles, it is necessary to remove the person from this role, and not from all at once. Everything is just like in life: you can be a postman, a father, a friend, a cricket player and an avid nudist. Moreover, if you are a bad father, you need to be deprived of parental rights, but this should not affect the role of a postman, and entrance to specialized beaches will not limit.



    Is your brain still intact? Then let's figure out how the processes work. If you carefully looked at the pictures, you noticed that in holacracy, in fact, there is a special hierarchy - the holarchy, which looks like a system of nested circles. However, the external circle cannot influence how the work is done in the internal circle, it does not have the right to give direct directions and manage resources (even the CEO cannot tell the ordinary SMMs what kind of seals it is better to post on Twitter if the SMMs seals do their job). The only things that the external circle can manage are the expectations, metrics and the list of roles of its subcircle. If it’s simpler, the external circle can share ideas and suggestions through the lead link , but all operational activities are determined by people from the internal circle.

    At each level of nesting, there are tactical and managerial meetings. On tactical people from the circle share information, synchronize the status of tasks and plan a little. For example, a scrum rally  is a tactical meeting. At management meetings, key members of the circle discuss the problems of the circle, select representatives and solve other important problems. It turns out something like an internal retrospective of the circle, which takes place according to very strict rules. The problems of the internal circle can be submitted to the management meeting of the external through the rep-link , but only if the problem cannot be solved within the circle or it affects the entire company. There are also the roles of a facilitator who monitors the constructiveness of all meetings, and a secretary who appoints and records them.

    Any problems in holacracy are called “tensions”. The default duty of any role is to eliminate them on their own or through management meetings, for which this model is even called “tension-driven” (driven by tension). Golden rules of holacracy:

    • do not bring up the problem that concerns only you
    • if you have found a solution to a common problem - bring it up so that it can be used as a rule




    As you may have guessed, holacracy does not answer the most important questions: “What exactly needs to be done?” And “What decisions should be made?”. It regulates the approach to organizing processes, but does not pose a problem and does not describe solutions. Holacracy is an operating system for a business that requires the installation of different applications. For example, applications for hiring employees, for planning, for logistics. Therefore, in the framework of holacracy, you can apply any fashionable practices: aggil, lin, scrum, if only there were benefits.

    Cholacracy Causes Side Effects


    Starting to apply holacocracy, you cancel the power of managers and directors and distribute it in “places”. This leads to an interesting side effect: leaders begin to stand out in circles. You no longer need to try to strengthen individual people - enough to strengthen the process once, and everything will happen naturally. CEO turns into a talking head, visionary and defines the overall goals and values ​​of the company. Dear CEOs, do not be discouraged, the most powerful ability will remain in your hands - to abolish holacocracy.

    The tribal structure disappears, which is formed in ordinary companies on top of the hierarchy. For example, when a secretary has an extremely close relationshipplays preference with the boss and suddenly gains power and influence in the areas of business that are farthest from his profession. That same power is evenly distributed and cannot be accumulated and used by one person to the detriment of another. Thus, communications do not destroy communications, and work does not destroy communications.



    Holacracy encourages breaking the rules if it does more good than harm. Everyone is free to do whatever they please if this helps the company grow. This is called "individual action."

    Holacracy replaces the personality with the role, but does not deny the personality itself. You can continue to go to work in shorts, scolding mother, bring a dog and drunk slutty women to the officeif you do your job well, meet the metrics and expectations and do not interfere with the rest. Following this, “personal facilitation” disappears. It’s not the developer Vasya who is to blame for the troubles, but the role and the process. This is demagogy, but it allows you to get rid of emotions and improve processes, instead of hunting for witches.

    Bureaucracy 4.0 or why holacracy is not needed


    Holacracy is thoroughly bureaucratic: there is a whole set of rules described in detail on the 30 pages of the special holacratic Constitution . It lists the main provisions, the organizational structure of the company, the management process, the work process and even the process of adopting the constitution itself. This small Talmud is constantly evolving (version 4.0 is already available), but the basic principles remain the same. The document itself is absolutely unreadable, there is even a simplified version for those who do not want to understand the bird language of near-legal terms. In fact, this document is the pinnacle of the holarchy.

    At the same time, the creator of holacocracy claims that it cannot be used in part - you need to once and forever take the oath of the Constitution and go into all seriousness. This, however, is not surprising, given that the only goal of HolacracyOne , created by Brian Roberson, is to promote holacracy through training and implementation. And that is why you absolutely do not need holacracy. The process of full implementation will break the brain worse than this article, it will take a lot of time and energy that can be spent on business development. And most importantly, it is unlikely to lead to universal happiness. The button fights with insanity and bureaucracy, we know how much they slow down the business and believe that any decisions need to be made, guided by reason and a broad outlook on things.



    However, some principles of holacracy can and should be put into practice. It just so happened that Button became one of the first companies experimenting with holacocracy in Russia (and certainly the first accounting company that has come to this). We hope you have a couple of weeks, and most importantly, the desire to read and understand this post, because that already in the next we will move from words to deeds, share our own experience and tell in more detail why we did not sign the Constitution 4.0 with blood. And if in the comments there is a keen interest in the subject, we will write a separate article about different roles, processes, rallies, cross-linking and other buzzwords. Ask questions, this will help a lot.

    Thanks for attention.

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