Business Man in Space

Into The ‘Outer Space’ of Company Dynamics – Companies Without Managers

I was searching the internet for new trends in business management a while ago. And, as often is the case, my search turned up a few good reads.

But nothing caught my attention as much as the story about a few companies that have embraced or plan to embrace a system of ‘management’ that discards the role of ‘managers.’

Initially, it all sounded very ludicrous. However, as I learned more about this approach, ludicrousness quickly faded. In fact, I started thinking that “this might actually work.”

Contrary to my expectation, this approach was not the spur of the moment thought of a bored company executive. Rather, it is already quite established, with its own name (Holacracy), a dedicated website, and a few companies that have implemented it. Plus, they apparently have a lot of good things to say about it.

Zappos, one of the listed companies, made the headlines recently. It was when they told their employees to go Holacratic, or go home.

The Shoe Retailing Company has been experimenting with the Holacratic system of management for some time now. And since April 30th, has apparently adopted it as a companywide system.

What is Holacracy?

Here is the following definition directly from the Website

“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. The work is actually more structured than in a conventional company, just differently so. With Holacracy, there is a clear set of rules and processes for how a team breaks up its work, and defines its roles with clear responsibilities and expectations.”

new trends in business management
Self Management and Team Work are Emphasized in Holacracy

Frankly, this sounds interesting, but it also raises some questions. Most of them are related to the very foundation of this system – the absence of managers.For example, among many other duties, managers are there to ensure the people working under them are putting in their best.

Zappos’ CEO, Tony Hsieh Offers a Solution

With self-management, there is the tendency that workers may not perform as well as they should. However, Zappos’ CEO, Tony Hsieh already has his eyes fixed on solutions to this potential problem.

Hsieh Says:

“I was on a Skype call with Frederic Laloux, the author of Reinventing Organizations. During our call, he said …………… we need to figure out what the antibodies are for when a small number [of] employees take advantage of the freedom gained from being in a no-manager organization, or else it will demoralize the other employees. He said that in general, research has shown that peer-pressure based systems work the best. For certain types of job functions where there are easy metrics to measure performance, a public leaderboard ranking will naturally create peer pressure by showing which teams are performing and which aren’t.”

Evidently, Zappos is being proactive as they implement this new, not fully tested approach for company management.

How self-management will turn out for the handful of companies who have implemented it, we cannot really say for now. But with the proactive, problem solving approach with which Zappos is taking this on, it will not be surprising if it actually turns out to be the gold standard for them, and for other companies who may then decide to put on their ‘shoes.’ Stay tuned for new trends in business management.

By: Mesheal Fegor
Sales & Support