Impressions of Holacracy: Purpose, Freedom, Accountability and Evolution

Sometimes, if you pay close attention, you can feel the tectonic plates shifting and grinding underneath our entire social and economic system.  As we imagine shifting business and the larger system into more collaborative and democratic patterns, we also must imagine shifting the way we organize to do work. A critical question that always seems to surface is “How do we do that when there’s so much at risk?”  Making deep structural changes to organizations means facing the uncertainties and discomforts of change and feeling the “earth” move under our feet.  No simple thing to experience, but many think it’s a reality for our future, nevertheless.

How are organizations beginning to think about reorganizing work to foster more creative freedom and collaboration?  Some of the first things to consider are organizing around shared purpose and values, clarifying roles and authority, and building trust and accountability. Some approaches use structures such as stakeholder engagement models, consensus decision-making, and systems for increasing transparency and decentralizing power.  Because there’s a lot at stake in business, organizations wanting change seek models that combine rigor with creative autonomy.  And, let’s admit it, we modern humans have kind of lost the knack for creating workplaces that are freedom-focused instead of fear-based, so we’ve got some relearning to do.  

“Holacracy is a new way of running an organization that removes power from a management hierarchy and distributes it across clear roles, which can then be executed autonomously, without a micromanaging boss.”  It’s an approach to organizational structure and governance that is being prototyped in startups and existing enterprises. Holacracy is part of an emerging workplace democracy movement that also includes other concepts like Freedom at Work, the Happy Startup School and cooperative-ownership models such as Mondragon and our local Arizmendi. Recently, Nika Quirk spent two days in a Holacracy training in the East Bay and came away with many impressions and thoughts to share.

Rani: You recently participated in a two-day immersion into the Holacracy method.  Would you be willing to share why you were attracted to this training?

Nika: Over this year, I’ve been working as a coach with Miakoda Taylor, founder of Fierce Allies, an enterprise that fosters deep partnerships across divides of power and privilege.  Exploring the potential of Holacracy for her growing organization, Miakoda connected with Karim Bishay, founder of Clearer Paths Consulting to facilitate the Fierce Allies training and invited me to participate. Because collaboration is a core focus for me and I look forward to engaging with Fierce Allies as it grows, I embraced the opportunity to train with Miakoda and her team.  

Rani:  Why do we need Holacracy? And, how does it work?

Nika:  (Laughing) I look at my beehives, Rani, and I say “that’s the point of Holacracy!”  All work is oriented to the purpose and prioritizations of the whole system.  The structure and practices seek to articulate roles with crystalline clarity (purpose, ownership, responsibilities and accountabilities) and streamline the application of energy to all work in the system.  This is a lean, sustainable system of work.

Holacracy is intended to engage every participant in governance, shaping both work activity and the evolution of organizational structure.  Everyone’s knowledge is valued, expressed and integrated and since participants have clear authority in their roles, they act with a balance of freedom and accountability. When implemented with fully distributed governance, Holacracy could be viewed as a powerful “hive mind” but with no “queen bee” governing over all.

Rani: What are some of your impressions from your experience with Holacracy in this training?

Nika:  One of my first impressions was that it has deep roots in natural systems thinking and integral perspectives.  This alone puts it in sharp contrast to our current reality in organizations and the greater social system since both of these ways of thinking about human life are unfamiliar to most people in Western culture.  My second strong impression was that this holacratic structure is a highly disciplined set of practices that I thought of as a “human maturity bootcamp” for the 21st Century. It’s very aligned with the Third Wave Business perspectives you and I are sharing in this blog.

Rani:  Would you unpack these impressions a bit more?

Nika: Early in the first training day, we learned about Holacracy’s focus on roles (“organizing around the work being done”) and ways of processing information in both tactical and governance meetings.  I made an immediate connection between this and the tendency in organic systems to “specialize and integrate”, leveraging the power of specialized knowledge and action through communication and collaboration across boundaries.  I believe this is one of the key benefits of holacratic process.  It supports the “natural fluidity of power”, fully empowering the flow of intelligence and energy through the system in service to agreed upon purpose.  

There’s much evidence of the systems view in Holacracy.  I’m quite fascinated with the core practice of identifying and processing “tensions” (what needs to change in the current reality). I understand from Karim’s experience that this becomes very fast adaptive practice in tactical meetings, processing potentially large volumes of items that turn into owned actions to move blockages, fill gaps, realign resources, and add work tasks. Once again, I’m thinking of the “bee meetings” I’ve witnessed in my hives through which streams of information are processed via touch, movement, and pheromones, resulting in individual and group action.  He shared that once you’ve gotten used to Holacracy meetings, you can never go back to what we typically experience in work meetings without feeling incredibly frustrated.

From an integral view, Holacracy integrates all quadrants and aims for continuous spiral evolution of the organizational system.  I believe it’s intended to develop a culture and community of purposeful work and develop individuals’ capacities to participate in mature collective leadership.  The tactical process guides the work and the governance process evolves structure in a distributive way. Even though organizing is around work and not people (“roles vs. souls”), I sense that individuals in the holacratic system are not anonymized. It’s likely they are valued, supported in many ways, and free to fully engage in their roles and in the distributed governance of the enterprise.  

As I stated above, throughout the training experience, I kept thinking about what a huge stretch Holacracy participation would be for most people.  Foremost, it requires a high level of maturity grounded in humility, reflexivity, equanimity, focus, succinct communication, integrity, and adaptability.  In his blog The Workologist, Sam Spurlin identifies four things he sees as necessary to succeed in an organization with a high level of autonomy such as exists in Holacracy.  These are akin to the leadership capacities we explicitly emphasize in our Integral MBA in Creative Enterprise and that are implicit in your classroom activities in Uptima Business Bootcamp – embodied awareness, curiosity, courage, reflexivity, empathy, collaborativity, creativity, and creative inquiry skills.

Redesigning and Prototyping the Culture of Business

Over the past forty years, we have become increasingly aware of the total impact of the Industrial Revolution and Information Technology Age.  Many of us are among those who dream of a shift to a more flourishing world. What will it take for us to actually shift our economic culture and systems?  In March and April, we touched on how important clarifying our definition of success and realizing our purpose is to shaping the world we dream of.  This month, our focus is on how individual behaviors can powerfully influence our economic culture and systems.  

First, let’s imagine a designer who is looking to produce an eco-friendly clothing line.  They’ve formed their business on a set of values statements like “fair wages”, “organic”, “locally sourced”, “sustainably produced” and “locally made with love”. While preparing their supply chain structure, they were excited to find a Western US fabric source during a trade show and made a “hand shake” deal to contract with them as a vendor.  As the designer moved through the contract process, they realized how the wholesale cost of materials would impact their profit margin and pricing.  Feeling uncertain about their customer’s purchasing behavior and their own ability to successfully market their products at a price that would make their business financially sustainable, the designer contacts a fabric producer in India (who doesn’t really match their values) and cuts a deal at half the wholesale cost of the US vendor.  Feeling rushed to get their first product line out before the winter holiday shopping season, they didn’t research the true cost of this “cheap” material which would include manufacturer’s fair labor, environmental practices, ongoing communication with a foreign vendor, and the energy costs of overseas shipping. This designer also didn’t consider the impact of reneging on their verbal agreement with the US vendor, including their own reputation in the industry, potential for future business with that vendor, and the financial burden on the vendor due to lost business.

With their stated values, how has this designer gone so awry?  Are they behaving in ways that model and generate the economic structures and culture of business they believe in?

To offer a holistic set of perspectives as a foundation, we’ll first provide a very basic introduction to the four quadrant framework of Integral Theory.  In the integral view, every moment holds the complexity represented in this image, the inter-relationship of everything.  When we as individuals are reflecting on situations and making decisions, it’s important for us to pay attention to each of these quadrants.  This attention to all the potential issues, ideas, influences and impacts supports decisions and actions that are grounded in greater awareness, compassion and positive intention.  Such practice supports our understanding of our impact in the world.  When we develop and participate in cultures and when we create and reinforce systems, we potentially affect the experience of individuals, including their beliefs, mindsets and behavior.  We as individuals and as groups also have the power to influence cultural and system change.  As we’ve so often heard, we need to “be the change we want to see in the world.”

Looking at the example of the designer, they believed and represented that they would be a sustainability-based business. However, in practice, they didn’t build that into their business culture and systems or into their own behavior as a business owner.  This is likely to be rooted in their own beliefs and mindset. For example:

• Anxiety and fear around their ability to market and sell the products at a price that could sustain the business
• Belief that profit needs to be maximized to ensure the sustainability of the business with little regard for the impact of the cost-cutting actions they took to support that goal
• Belief that it was just okay to back out of a handshake deal because it wasn’t really perceived as their active commitment to another business
• Belief that the current culture of business supports their actions, e.g. larger organizations are seen to focus on maximizing profit, do business based on signed contracts, and seek cost-cutting in any way possible.

In a flourishing world, what does the culture of business need to be?  Who do we need to be in order to create that culture?  We believe that these are the essential questions we all need to reflect on and wrestle with as people in business.

Psychologist Bill Plotkin characterizes modern society (including our business culture) as egocentric, an adolescent society where many adults are still behaving (and encouraged to behave) in adolescent ways.  He also frames our current state as an opportunity, saying, “adolescence holds the key to our becoming fully human…The adolescent [of whatever age] comes to know what she was born to do, what gift she possesses to bring to the world, what sacred quality lives in her heart, and how she might arrive at her own unique way of loving and belonging.”   

We agree that this is a time of opportunity and accompanying challenges. A time in which we are designing and prototyping a culture of business where we can know and act on our purpose, bring our gifts, engage our hearts, and co-create an economic system rooted in loving and belonging.

What We Design Designs Us

We’ve critically thought about business success, about engaging with and sharing our ideas, and this month, we’re exploring “how do we approach bringing those ideas into reality”?  As we brainstormed about this question, we agreed that bringing ideas into reality rests on a core process of interior-exterior development in the context of a flourishing world vision. First, we’ll unpack that statement a little.

Let’s start with “the context of a flourishing world vision”.  Just what do we mean by that?  Visions of the better world we want to live in are as diverse as the people who envision them.  Each of us holds a vision emerging within us; we may find other visions that resonate and communities we can begin to align with.  We can see many authors, educators, futurists and organizations lifting up these initiatives, and we can hear the ideas of people close to us and in our networks.  Futurists like Charles Eisenstein, author of The More Beautiful World Our Hearts Know Is Possible, offer possibilities for who we might become as humans and how we might reshape our system:

Our healing will come from the margins. How could it be otherwise, as the center falls apart?

It will come from the people and places that were excluded from full participation in the old Story of the People, and that thus preserved some piece of the knowledge of how to live as interbeings.

It will come from the ideas and technologies that were marginalized because they contradicted dominant paradigms. These include technologies of agriculture, healing, energy, mind, ecological restoration, and toxic waste remediation.

It will also draw from marginalized or near-forgotten social and political technologies: consensus-based decision making, nonhierarchical organization, direct democracy, restorative justice, and nonviolent communication, to name a few.

It will engage the kinds of skills that our present system suppresses or fails to encourage. People who have languished outside our dominant economic institutions, working for very little doing what they love, will find their skills and experience highly valued as pioneers of a new story.

It will liberate the marginalized parts of people who have been suppressing their true gifts and passions in order to make a living or be normal. To some extent, this category probably includes every member of modern society. We can feel the stirring of these suppressed gifts any time we think, “I wasn’t put here on Earth to be doing this.”

It will embody and validate marginalized parts of life, the things we neglect in the rush and press of modernity: qualities of spontaneity, patience, slowness, sensuality, and play. Beware of any revolution that doesn’t embody these qualities: it may be no revolution at all.

Others describe developments that lead to aspects of a more nature-connected, more collaborative, and more socially just world vision.  Restoring our connection to nature, providing specific nature-based practices, is the path supported by Bill Plotkin’s book Soulcraft. In Biomimicry, Janine Benyus shares how we can tap into nature’s intelligence. Authors like Marjorie Kelly and Jessica Gordon Nembhard illustrate how cooperative ownership plays a significant structural role in creating an inclusive system where all might flourish together.

Drawing Hands. M.C. Escher 1948

What does this have to do with bringing our ideas into reality?  Here’s what we notice.  Our ideas need to be designed both for what people need now and as transformative elements that move us toward the reality of the better world we wish to create.  Our ideas need context. And as well, we need to be developing as people who are designers of that world.  Whether we are conscious of it or not, what we can design can design us as well. This is the basic idea of ontological design. Accompanied by stunning imagery, Jason Silva, currently a presenter and producer on the Discovery Channel, provides a concise explanation of this concept in this short documentary, which includes professor and author Costica Bradatan’s description of our inter-relationship:

Just as you grow into the world, the world grows into you. Not only do you occupy a certain place, but that place in turn occupies you. It’s culture shapes the way you see the world, its language informs the way you think, its customs structure you as a social being.

As we work toward realizing the envisioned flourishing world, internal work (as individual or as an organization) needs to continuously happen as we are designing and constructing. A flourishing world needs to be co-created by people who are transforming themselves to live flourishing lives.  The world we create depends on our own evolution. If this sparks your inspiration, you might discover more through the next Evolutionary Leadership Bootcamp on August 23 in Oakland presented by the Institute for Evolutionary Leadership.  Here’s a preview.

We’d love to hear your thoughts…leave a Comment below.

Critically Thinking about Business Success

Critical thinking requires tremendous courage.

In order to make the “great change” necessary in society, the economy and business, we need to be willing to take risks and question the accepted norms – assumptions, beliefs and behaviors – that underlie the statement we so often hear: “well, that’s just the way it is.”  As business educators, we (Nika and Rani) hold critical thinking as one of the key areas of 21st century human development and the practice of Third Wave Business.  In this post, we’re drawing on experience with hundreds of business students, owners and practitioners. We are sharing from what we’ve noticed and learned, and what we integrate in our classrooms and coaching sessions.

What prevents us from critically thinking about success in business? As consumers and people in business, we are so programmed in “business as usual” that it takes a major effort to pause, reflect, examine and evolve a different perspective, our personal “stand”.  Many of us might even feel that the ways of traditional business are just too big or hard to shift and that it’s futile to take a stand.  Instead, we focus on learning to effectively play the existing “business game”. So often, small business owners, freelancers as well as those of us who have worked for others most of our lives, do not see ourselves as “being in business” or having any voice in determining what business is.  This adds an extra resistance to using a critical eye and voice because we might have the idea that it’s not relevant to our role or success.  It might also be true that questioning the accepted norms of business is tied to fears that by doing so, we put our own success at risk.

In our “business as usual” world, what does it mean to be successful?

Enter the keywords “business success” in YouTube and you’ll find pages of motivational and testimonial videos attesting to provide you with the “4 keys”, “11 steps” or “proven wisdom” to be successful in business.  Some may even promise to reveal the secrets of becoming a billionaire.  Thousands of blog posts live online.  Books on this topic fill the shelves in stores and online, and articles proliferate in the pages of publications from People to Harvard Business Review.  But, how many authors and readers question the definition and impact of the “success” that we are encouraged to pursue and achieve? Some do, but predominantly, the messages are the traditional ones of solo achievement and a focused strategy that results in wealth, position and power.

The critical question for each of us is more like “What definition of success is personally meaningful to me?”  As any of us explore this personal inquiry, we necessarily ask ourselves to define what we need and want, and why we think of them as part of our success.  Our exploration may root down into:

• what has heart and meaning, and contributes to my happiness?
• what utilizes my knowledge and skills, and continues to expand my learning?
• what supports my economic self-sufficiency and thriving, and that of my loved ones?
• what legacy and impact do I want to contribute locally, regionally, or in expanded networks?

For a bit of inspiration, we appreciate the vision in this video of Aftab Omer in conversation with futurist, Charles Eisenstein, about Beyond the Green Economy (part of Meridian University’s Integral Voices public program series). Eisenstein brings a critical eye to our current identity as “homo economicus” and imagines our co-creation of a world in which we all flourish.

We invite you to share, in the Comments below, your experience in personally exploring these questions about business success.