Carol Sanford

Carol Sanford is a Senior Fellow in Social Innovation at Babson College in Massachusetts and a recognised thought leader, working with Fortune 500 companies and new economy executives in designing and leading systemic business change and design.

A recent Fast Company article announced that holarchy, an alternative organisational structure that removes hierarchies, is the latest in workplace trends. But holarchy is nothing new: the first iteration of the revolutionary idea of removing hierarchies happened in 1966 in Procter & Gamble, in Lima, Ohio.

So really, the so-called ‘modern, new, revolutionary’ work designs are about 50 years late at being first. And these ‘new’ versions of holarchy are missing some of the more important features of the original and all of the evolution of the past five decades of work design.

Details of the truly original non-hierarchical system at Procter and Gamble are in the prologue of my book, The Responsible Business, because the creators of that system were my early mentors.

I was the designated inheritor of the legacy and charged with taking it to the next level.

None of us assumed it was the best that would ever exist and, besides, it needed to be ‘a living idea’.

I could see within about five years of designing the next versions of work systems for pharmaceutical, chemical and forest product companies, that the concept needed a significant evolution.

The Shortfalls:
Examining Holarchical Work Design
As I read and interview people on the recent offering for management work design, I find four shortfalls in the design and execution of the concept. While the modern iteration is definitely better than the traditional management systems it is compared with, it has still not lived up to the potential of what it promises. Why is that, and can we do without hierarchy?

Shortfall One:
Internally Focused
The current flat model is not tied to what I call ‘systems actualisation;’ the market and the ecosystem. It is just focused on the company or business working well. The innovation and development potential is lost without committing to making big changes in systems.

For true non-hierarchical approaches to succeed, teams need to organise around a greater whole system.

The external work, and greater whole system is thinking about the customer’s future and innovation. Every member of the company, regardless of actual role, should be thinking about that.

Shortfall Two:
Static Concept
The current flat model, holacracy, is a schematic for Operations. The concept stays fixed even as strategy changes. If work changes, then there are changes in who is organised around the work, but the concept itself does not really progress or evolve as the work is done or the market dynamics change. It has no real-time way to change and is therefore not resilient to market conditions. Changes are made by projects and initiatives, not by how the ecosystem exists every day.

Shortfall Three:
Existence instead of Potential
The differences can be a bit hard to grasp until you play with it for a while. The latest iteration is about what is currently made by the business and done by the workers.

The structure is to improve what is already in the world of work. It starts from making that which already exists, better. It is built off an existing idea and then improved. It does not start from the potential life of a customer. The work is not organised to make the relevant change and evolution.

Shortfall Four:
A Fixed rather than a Developmental View
Carol Dweck, in her best-selling book, Mindset, starts the idea but stops short. We can see a child (or adult for that matter) as fixed in behaviour, character and level of intelligence, or see them as a work in progress and capable of new skills and approaches. What needs to be added is developing at a deeper level,¬ where not just function is added but change in inner being, ability to manage one’s self to be self-determining of one’s will or motivation.

Even when acknowledging uniqueness, the current iteration of holarchy assumes humans are unique, but not developable; trainable, but not fixed.

The development view of people is that they are not complete and only waiting to use their skills. This is different than knowing that each has an essence and a potential evolution of their expression.

Why do these Shortfalls Arise?
Primarily because they are not anchored in a living systems theory of change. I work from a set of core principles that are drawn from how humans grow and express their potential and how all systems that humans construct actually work; including how humans are imbedded
in other systems.

I evolved toward a design that uses the principles over four decades from where I started. The recent iteration is, however, not even starting from the form P&G offered up in 1967.

Today’s business designers of work systems tend look at how to improve current work, current conditions and current performance. Few consult the core principles of developmental work design. If they did, the focus would shift onto how to realise the greater potential of each individual, the business and the stakeholders – starting with those who keep you in business – the customers