“I felt like being part of a code, operating [within] an algorithm that is optimized for machines, but not for humans. Instead of feeling more whole, self-organized and more powerful, I felt trapped. The circles I was being part of did not feel empowering at all but taking away my natural authenticity as well as my feeling of aliveness. It was fully unnatural and we were disciplined by rigorous protocols and procedures.” 

(Source)

Some years ago, I spent some time looking at governance models, such as sociOcracy and holacracy. Sociocracy, based on interlocking circles, looked very interesting, as it was rooted in cooperative spirit,  but it was closed source and I could not afford their teaching material. Holacracy on the other hand, was open source, which is believe one of the reasons for its more rapid uptake, but I still had reservations. The first reservation was with its linkage with integral theory, which is in majority a neoconservative approach, and Holacracy explicitely re-integrates more hierarchical approaches in its reworking of sociocratic principles. More seriously though, holacracy belongs in my opinion into what I call ‘the communism of capital‘, i.e. trends towards cooperation that do not in any way challenge the very purpose of entreprise, i.e. maximising profits. At that time however, there were not so many practical experiences with the new methodology. That has now changed, and it shows that holacracy may have even more serious issues in its implementation, as the excerpts below suggest.

“Aimee Groth:”

“Holacracy was developed by software engineer Brian Robertson, who has sold CEOs like Hsieh on a product that promises to push humans to run like a computer operating system. The biggest barrier to such hyper-efficiency is the complexity of human emotion. Holacracy doctrine, in turn, attempts to eliminate or compartmentalize the ways in which our humanity interferes with productivity.

As Zappos onboarded its employees to the system over the past four years, one of the biggest complaints, far and away, was around the rigid meeting format, which provides the guardrails for the system. Tactical meetings, as described by the Holacracy Constitution, tightly govern how and when employees can speak up. The meetings, which typically are held once a week, open with a check-in round and then dive into checklists and metrics. The Constitution is clear that there is “no discussion” during the check-in and closing rounds. In other words, there is no natural, back-and-forth conversation that begets camaraderie, respect, trust, and connection. No small talk.

“In the beginning, you feel that the human element is lost completely,” Jamie Naughton, Hsieh’s chief of staff, previously told Quartz. “I remember sitting in meetings wanting to scream at the founder of Holacracy, ‘You don’t get it, you don’t get it at all!’ He said, ‘You’ve got to trust the process.’ And I thought, ‘This sucks.’ You just have to wait your turn to speak your opinion.”

Years into the experiment, Zappos employees are still unsettled about Holacracy. (Robertson says that it takes five years for Holacracy to work.) Some are uncomfortable with the way Hsieh has attempted to “gamify” the company. Zappos has explored “badging” (giving employees badges based on their proven skill sets) and “people points,” which is currency that employees use to fill roles within the company. (For example, hypothetically, an employee could designate 50 of their 100 people points to an engineering role, 25 points to a PR role, and 25 points to a more peripheral role in the company, like philanthropy. People points determine how an employee allocates their time, and it also determines their salary—some skill sets are still more valuable than others within a Holacracy.) Employees who have too many unallocated people points are sent to “The Beach” where they either need to find new roles within the company or are let go. The overwhelming feeling of instability (worrying about people points, or whether they’ll be sent to The Beach) has sparked the fight-or-flight response that Brown spoke about in her keynote.

“When something difficult happens, emotion drives,” Brown told the crowd at the Smith Center. “And cognition, thought and behavior are not riding shotgun and telling emotion where to go. When something difficult happens, thought and behavior are tied up in the trunk and emotion is at the wheel.”

As it turns out, eliminating “the human element” doesn’t make it go away. Worse, it leads to an undercurrent of resentment. At Zappos, dissatisfaction with Holacracy played a role (though it wasn’t the only reason) in nearly a third of the company walking out the door in 2015. That same year, Zappos dropped off of Fortune’s “Best Companies to Work for list” for the first time in years.” (Source: “Zappos is struggling with Holacracy because humans aren’t designed to operate like software“)

See also: Holacracy is fundamentally broken,

Photo by Photographing Travis

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