Published on July 9th, 2015 | by Travis Dicken0
What the Heck is “Holacracy” and Why is it Important?
A new trend is creeping over the new, younger, tech savvy generation of the bourgeois. These are the “hip” young executives inspired by the more approachable public personas of Steve Jobs and Bill Gates. The trend is called “holacracy.” What exactly this “holacracy” entails can be difficult to explain, and reports of its impact on workers often are confusing and contradictory. It is important that socialists analyze and understand holacracy and develop a coherent socialist perspective, because this development in capitalist relations is pushed by younger members of the ruling class.
Created by a software designer, “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.”
Essentially, it creates boss-less companies that allow greater employee independence and creativity, thereby increasing productivity through employee satisfaction. The Holacracy website is administered by HolacracyOne, which aims to assist other companies to create holacratic workplaces, The website details the differences between holacracy and traditional workplaces in a variety of ways. It aims to replace job titles, which are often outdated, limiting and overly simplistic. Titles bear little relevance to an employee’s day-to-day responsibilities. Holacracy offers “roles” that employees can fill based upon their preferences and talents. Employees may fill more than one role simultaneously. It also claims to abolish traditional management hierarchies by organizing employees into boss-less “circles.” These groups of employees are assigned a specific task, in which they delegate responsibilities amongst themselves in order to create “distributed authority.” One thing that becomes immediately clear is that the idea of holacracy already has an entire language that has sprung up around it. The website offers a glossary of common holacratic terms, and are included at the end of this article.
The website and a recent Wall Street Journal (WSJ) article detail the efforts of retailer Zappos to implement holacracy. They reveal a muddled picture of what a holacratic workplace is actually like. According to the WSJ, many employees reported confusion regarding holacratic organizing in the workplace and displeasure at sitting through hours of meetings and seminars on the topic. Some workers expressed worry that the lack of a management class could negatively effect their career aspirations. The time spent in meetings loomed large over the WSJ article. Employees reported up to five extra hours per week of meetings. They centered upon learning how to operate in a radically different workplace and learning the holacratic vocabulary. The new philosophy of Zappos was also spelled out in a 30-page constitution.
The Journal went on to report that just over 200 employees, representing 14 precentof Zapposʼ workforce, decided to leave the retailer amid confusion and concerns about their altered career paths. Other employees reported a feeling of unease as daily routines were disrupted. Zappos CEO, Tony Hsieh, 41, defended the system by saying that it encourages employees “to act more like entrepreneurs.” Notwithstanding, employee retention was at 86 percent for workers who decided to stay at their jobs, instead of accepting severance packages worth three months of pay. He did admit, however, that holacracy “takes time and a lot of trial and error,” and wrote in a memo that Zappos, “hadnʼt moved fast enough towards self-management.”
Not all reports from Zappos employees were negative. Brianna Alex, 26 and a former manager, told the WSJ that she hadnʼt been guaranteed a new position and faced the possibility of a pay cut (Zappos claims this is very unlikely). Her new role of “managing the work” instead of other workers left her with more time for the companyʼs workplace diversity committee and dance team. Other employees said that they felt meetings were now much more productive. They praised a feature of holacracy in which all employees are given an allotment of time during meetings to say whatever they have on their mind. This allowed one shuttle driver to lodge a complaint about employees leaving trash behind in Zappos shuttles. He claimed to have felt uncomfortable for years addressing this through other avenues. The WSJ also reported that 80 percent of businesses that adopt holacracy stick with it for more than one year.
Due to the relative newness of holacracy and the small number of workers it currently affects, this analysis is necessarily incomplete. The perspective presented below will be amended, added to, and refuted in certain instances as more information becomes available to socialists. Self-criticism is, after all, how we build a more complete understanding of the world around us. However, being that this is a new development in capitalist relations, it will not do to ignore it.
The practice of holacracy stems from a recognition by members of the ruling class of the alienation prevalent amongst workers in capitalist labor. It attempts to combat this alienation — and its revolutionary potential — by restructuring the authority of the traditional workplace to give workers a greater sense of self-control over their work and provide them with a feeling of empowerment. Equally important is the elimination or restriction of a traditional managerial class of workers. Job cuts will likely result in greater profits for the owners of large businesses, as they no longer have to pay certain workers more to control their compatriots. At its best, holacracy can create a faster-paced and more productive workplace, leading to greater profits for the ruling class. At its worst, it can create a morass of employee confusion and hours of bureaucratic meetings. Most importantly, it fails to address the exploitation at the heart of capitalist alienation. It also exposes such contradictions within capitalism as the often conflicting desires (“tensions”) for workplace autonomy and career advancement. The latter is often obtained by becoming a part of the managerial apparatus that allows the ruling class to exercise more centralized control over their businesses.
Whether holacracy is a noble yet flawed attempt at improving the social relations within capitalism, or a cynical con meant to distract workers from their exploitation will be up to the reader to decide. What matters more is understanding that the goal of holacracy is worker self-management, as opposed to socialist worker ownership of the workplace. Nevertheless, it will be important to monitor the successes and failures of holacracy, as self-management will be an important part of many, if not all, cooperative enterprises. We must also make an effort to predict how holacracy will develop in our late capitalist economy.
It is reasonable to hypothesize that holacracy will catch on more amongst the ultra-competitive worlds of the technology and finance industries. In these companies, employee and executive poaching is common. Also, well-educated workers from the upper strata of the working and middle classes expect to be treated more equitably by employers. Happier and more productive workers are of considerable benefit in such competitive fields, yet still secondary to the ultimate goal of greater profit and market share. It is much harder to picture holacracy becoming a common practice in the retail and food service industries that dominate the lives of many millions in the working class. Retail and fast food giants face very little threat to their positions. They have made such a common practice of treating employees as disposable commodities that such treatment has come to be expected by customers, workers and owners alike.
Holacracy will likely become a privilege of certain, more elite, workers and will be used as the carrot to keep lower classes of workers moving forward through the profit machines of capitalism. The stick, as always, shall remain poverty.
Glossary of Holacratic Terms
Role: The responsibility of an employee
Circle: A group of self-organized employees who have been assigned a certain task
Tensions: Conflicts in the workplace
Tactical Meetings: Recurring meetings of a circle held to achieve an assigned goal
Energizing a Role: Doing a job