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“Holacracy” by Brian Robertson – BOOK SUMMARY

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(dramatic music) – [Narrator] Holacracy by Brian Robertson. The new management system
that made headline news when Zappos asked that all its
employees follow the system or take a pay to resign, and 14% of the employees
took the option to leave. The holacracy structure resembles how nature organizes
systems, like the human body. Our cells function
autonomously within organs, which, in turn, function
autonomously within the body. The impetus behind holacracy. The main idea behind
this new system is that today’s companies have to
survive in an increasingly complex and dynamic
environment that requires an equally dynamic
organizational structure in order to properly address new challenges and opportunities. The solution germinated
from the observation that humans have a unique ability to sense tension within an organization, which is defined as recognizing the gap of what currently exists and what
could be the current reality and the sensed potential. Why should you care? Holacracy is a system that aims to make companies evolutionary
by capitalizing on this unique ability that we have. By doing away with the concept of manager, it effectively breaks down communication and collaboration barriers formed by traditional siloed
pyramid org structures. Managers like the new system because they don’t have to spend their entire day solving everyone’s problems. And employees like it because
they feel truly empowered to act on tensions,
problems and opportunities that they recognize. Rethinking the corporate org structure. Instead of thinking of a
company as a pyramid of people in different departments and
with different authorities, think of it as a set of nested circles that consists of different
roles, not people. For example, a company
may have a production, a marketing, and a finance role. And a person can fill more than one role. The founder may fill the
marketing and finance roles in a startup, while an employee
fills the production role. All these roles live within a circle, which is simply a group of roles. As a company evolves and
roles become too complex, they can break into subcircles. In the previous example,
the marketing role can later evolve into a marketing circle that encompasses the roles
of client communications, advertising, and social media. Innovation to empower employees. One of the key innovations of holacracy is that the person who fills a role is empowered to execute an assignment the best way he or she sees fit. There’s no manager to
override that decision, and no one has such authority, not even the CEO. In this sense, holacracy creates a very empowering environment where authority is truly distributed. For example, if the person
filling the marketing role in an organization wants to create a LinkedIn page for the company, he is free to do so without
asking anyone’s permission. The only limitation is from any restrictions set in governance. For example, there could
be a rule regarding use of the company’s logo that he needs to adhere to. Now, let’s say that the person filling the events
organizer role notices that the information on the
company LinkedIn page is not updated frequently enough with the company’s events information. If she wants to expect the marketing role will do that regularly, then she must propose
adding a new accountability to the marketing role
during a governance meeting. At an upcoming governance meeting, the person in the events organizer role presents that proposal. After a structured process involving some clarification and reactions, the meeting moves on to
the objections round, where the marketing person says he can’t post about events because he doesn’t have the clear information on when they’re scheduled. The amended proposal to also
make the events organizer role accountable for publishing
a calendar of events. Once there are no more objections, the proposal gets adopted. What does it all mean? The holacracy playbook is
new and feels fairly complex. It starts by separating
people from functions, assigns activities to specific roles, dynamically adjusts roles as companies and their
environments evolve, and makes sure that
roles have great clarity. But this is just the beginning. Holacracy is a very
different management system that requires you to
rethink your organization from the ground up. It may feel awkward, foreign,
and uncomfortable at first. But it may be the only path to install evolution within your company. (dramatic music)

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