Practicing 5 years of Holacracy: our 5 take-aways

This blog was originally published on the website of Devhouse Spindle.

Voys was one of the first companies that adopted Holacracy in The Netherlands. In 2020 it was five years ago that we started working with this organizational model. Through five years of Holacratic practice we can say we’ve become better at the game, and to mark this accomplishment we wanted to share five things we observed and learned along the way.

1. Leaders replace managers

Before we started with Holacracy, we didn’t have any formal kind of organization structure. We didn’t need to, because we were small enough to know what everyone was up to and responsible for. We were very anti-manager and against any kind of organized hierarchy. This helped us with the transition to Holacracy because we didn’t have many old habits to unlearn. It is a common misconception that Holacracy doesn’t require leadership, and it becomes a pitfall when leadership is equaled with management or hierarchy. The big difference is that Holacracy invites everyone to take up leadership within their roles, not just the former managers. When this happens, authority becomes distributed across all the roles in your organization, not just to a small group of people.

Leadership is not a zero-sum game, at least not in Holacracy. When I strengthen my personal leadership skills, it does not detract from anyone else but instead it is an invitation for everyone else to do the same. But like any other skill, this is one that needs conscious practice. New colleagues often go through a little culture shock when they start working in a Holacratic organization and discover how much autonomy and authority they have. Colleagues that have been working with us for a few years also need the occasional reminder that they have the power to make big decisions. Which brings me to the following point.

2. It’s an ongoing practice

After the initial ‘culture shock’ it’s pretty easy to get used to working in a Holacracy. It quickly becomes the new normal. And with normality… comes complacency. Of course we still onboard new colleagues into this way of working, but we also tended to assume that older colleagues were all up to speed with how Holacracy is supposed to work. This is, after all, “just how we do things”, right?

Turns out that even for organizations with a few years of Holacracy practice under their belt, it was easy to let the practice slide without noticing. Facilitators in meetings would just go through the motions and copy what their predecessors did. This resulted in a form of facilitating where the real beauty of tactical meetings get lost because of, in the worst-case scenario, the desire to let everyone have their say and build consensus before making decisions. Using the authority you have in your role is sometimes really difficult, especially when it comes to making unpopular decisions, so in some circles it would become more of a habit to ask for permission. And of course some tensions, especially ones that involve the entire organization, can be very difficult to solve so it is tempting to let them slide.

What we’ve learnt is that working in a Holacracy requires constant conscious practice. Training for facilitators and having access to an internal or external Holacracy coach (or both) is essential. Holacracy is not complicated or difficult, but it takes conscious effort to make it natural.

3. Holacracy is not complete

Holacracy is a system to organize work – not to organize people. But of course, it is people doing the actual work. The Holacracy constitution explicitly does not mention anything about organizing people or organizational culture. It will not tell you how to deal with compensation, with performance management, with how you relate to each other, working hours, how you create strategies, or how often you should throw parties. The answer that Holacracy will give you to tackle all these things is simple, elegantly simple. But perhaps it’s too simple? “Just create a role for it, and let them figure it out”. Holacracy will tell you who has the authority to assign people to roles, but not how they should make the decision as to who is the best fit. This, and about a thousand other things, you still have to figure out yourself.

Don’t get me wrong, this is not a shortcoming of Holacracy. Holacracy is not about culture, but rather a set of rules about organizing work. This is great, because it gives every organization and the people in it the freedom to shape the work culture exactly how they want to.

However, over the years we’ve had some tensions about ‘big’ topics like compensation, strategy, and spending money. For these topics we created ‘apps’ that form a layer on top of Holacracy. If you see Holacracy as an operating system for your phone, you can see the apps as the part that makes that operating system actually really fun and useful. We have ‘apps’ for compensation, our strategy, spending money, and we’re working on an ‘app’ for feedback and role-fit.

4. People are not only the roles they fulfill

As mentioned before, Holacracy is all about organizing work and not about organizing people. One of the key points is the separation between ‘role’ and ‘soul’. But it’s the intersection of those where things get really interesting. While Holacracy says nothing about the people or your organization’s culture, making that culture come alive definitely still takes work. That work tends to be distributed among many different roles and circles, which of course means we have a role that organizes the best parties!

Solving tensions that you likely feel from a personal perspective, such as about your salary or the lunch that we offer, can be difficult. After all, Holacracy is mostly geared towards solving tensions from roles, but the question ‘does my role care about this?’ doesn’t really fly here. However, there are likely other roles that do care about this (in our case we have a role that maintains our compensation model, so if there are many tensions about salaries that role would probably care). Personal tensions are just as valid as tensions clearly sensed from a role, but differentiating between them can be tricky, and processing them can be too. It’s wise to be aware of and keep in mind the differences between these types of tensions when working in a Holacracy.

5. Make Holacracy work for your organization

It’s not perfect, it’s not a silver bullet, you have to create your own ‘add-ons’ that fit your organization’s culture, but all in all, Holacracy is pretty awesome. It provides our ever-changing organization with the structure it needs. For us, it gives great flexibility which has come in pretty handy during abnormal situations, such as the recent pandemic. Responsibilities and accountabilities are clear. It encourages people to embrace their autonomy and make smart decisions (and if they mess up, like we all do, to learn from their mistakes). It allows people to fill multiple roles, sometimes in completely different disciplines, crafting their own job to align their talents and ambitions with those of the organization. With Holacracy, we can grow Voys in a way the whole organization thinks it should.

What’s your point of view?

These last five years have taught us a lot about Holacracy, but have also shown us that we will always have work to do to keep Holacracy alive in our organization. By sharing these lessons that we learned, we hope we have given you some things to ponder. Whether you are contemplating switching your organization to a Holacracy, or you are seasoned Holacracy practitioners who have faced the same challenges we did. We’re always curious about the experiences of other Holacratic companies and love to share our knowledge with those who are new on the subject. Just leave a message in the comments below and let’s get in touch!