June 30th, 2016

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Our last blog post covered the core reasons why we have moved to a ‘Holacracy inspired’ structure at Humankind. But it definitely isn’t as simple as that – the following is a little more detail around why we looked for a new structure and how we are going.

Our Holacracy journey started towards the end of last year when Humankind went through some really steep growth and I was becoming a serious bottleneck – I realised that in order for us to achieve our business objectives more people needed to be able to make decisions than just myself. I had started doing some digging around alternative business structures with a focus around how we could do a better job of sharing decision-making and authority, especially given the awesome self starting attitudes of our team.

I also really liked the concept of everyone in the business contributing to the growth of the business – not just in sales but everybody having a say in the evolution and improvement of Humankind as a whole – easier said than done, especially when you have flexible work arrangements and remote working in the equation.

The last factor was that it had to be scalable – this came out of a growth problem, how was the way we structure our business going to help or hinder us as we continued to grow into the future.

What was important for us was to work to our strengths – we have a whole team of super smart people; we shouldn’t need to be managing people on operational tasks so traditional management styles are an awkward fit. Through the research I did, I read about Zappos using Holacracy to move towards everyone in the organisation being able to act like an entrepreneur, which really jumped out at me. Holacracy is a way of working with a focus on relevant skills and collaboration rather than levels of seniority. Everyone and no one is in charge, and everyone in the business is able to process tensions and therefore improve the business incrementally.

The real benefits of running a business in this way is the ability to share leadership and responsibility across the business, providing an opportunity for everyone in the business to contribute across the different business functions, allowing for a high level of agility and efficiency.

Holacracy is a relatively new concept in New Zealand so it was hard to reach out to businesses currently putting it in practise in our specific context, but when I had researched to the point that I was confident that it was feasible for us both in how it would be beneficial and how we could implement it, I basically went into a consultation period with my team. I structured a document covering where we had come from and our key achievements over the last 2.5 years, what were the reasons we were looking to change and then what were the benefits I was hoping to gain from Holacracy.

Being an HR business, everyone had very strong views on how it should work because they all do this for a living, it was really important to talk through all possible outcomes and agree as a team that Holacracy was right for us.

We ended up decided a Holacracy inspired model would be the best fit for our flexible working environment and organisation values than a more traditional hierarchal structure, finding a balance between our current format and the standard Holacracy format. We run the business using circles, and every person within the organisation has the opportunity to self nominate in and out of circles, as they desire. This is a new way of working and we are calling it HR Shop 2.0.

The fundamental principles behind the changes were organising a business around functions and not people, distributing decision making, and allowing individuals to contribute across the business. Traditionally in a services business you would have people contributing solely to their client work, whereas I wanted people to be able to do client work as well as contribute to what is going on within HR Shop and traditional hierarchy structures wouldn’t have accommodated that as easily.

The process definitely wasn’t without a few hiccups. One mistake I made was taking a punt at what the circles were that we needed and which circles people might end up in, purely in the essence of time, and that was a really bad idea. The team was like, “well you’ve kind of told us where to go and what you think we should do”, when the point of Holacracy is about people getting to self-nominate themselves in and out of different circles. It was quite a mental shift for me – after seeking feedback from the team I realised that even what I thought I had put forward as a Holacracy inspired model still had hierarchy in there and we needed to get rid of that. V2 had all of these left as blank for everyone to self-nominate in to where they felt the best fit – of course this was a much better idea!

I took onboard plenty of other feedback and made adjustments as necessary to build a model that really suited us – the team were happy that I had listened and in the end could understand the vision and how this would enable us to achieve our goals more than a normal structure. By and large the feedback ended up being really positive, and for the last 4 months we have been working within a ‘Holacracy inspired’ structure with 6 key circles and two larger overarching circles, business monitoring where the circle heads meet to ensure synergy across the circles and the the board which is responsible for governance.

Key takeaways for me have been:

  • Holacracy isn’t for everyone and changing your organisational structure is a big job, not to be taken lightly. This seems obvious but needs to be said, especially with the speed at which technology and ideas change – jumping on the bandwagon is not the best reason to adopt a new business model
  • For us it was all about playing to our assets – when we have a huge amount of trust in our team anyway, to use that to our advantage is as much about making good business sense as it is about empowering team members to utilise that trust factor and make measurable impact on the business
  • Trying something new is always going to be a learning curve, and it is up to you to take onboard learnings and adapt for the better – and the result is always better than if it went smoothly from the get go

At the end of the day, the real measure of success is seeing circles radically improving the business without needing to jump through gate keeper hoops, regardless of whether I am involved. It’s kind of every business owner’s dream to have their team as committed and passionate about the business as they are. Its not for everyone, but it’s working for us and I am really excited to see our holacracy model grow and evolve with us as we continue to expand in size and location.

Would Holacracy help or hinder the way you do business? Have you seen any other awesome alternative work structures making a positive impact on an organisation? Let us know in the comments below.


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