Business 2.0: no job titles, no managers

Two sides, one coin: leadership and empowerment
PostedFebruary 26, 2014, in  Step 5: improve & innovate
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‘The essence of leadership is to create more leaders, not more followers’ (Ralph Nader). That sounds great, but how do you do that in a hierarchically managed organisation? Clothing business Zappos has found the answer: no job titles, no managers, no hierarchy. This is Business 2.0.

Zappos, source:

Role model

In the EFQM Model 2013 excellent leadership plays an important role: ‘Excellent organisations have leaders who shape the future and make it happen, acting as role models for its values and ethics and inspiring trust at all times.’ Leaders are expected to act as role models for their people. Often this is interpreted as 'working hard', 'have a career' and 'showing commitment'. These have always been good principles, but it is time to do things differently.

From hierarchical to holacratic

Meet a good example: Zappos, an online clothing business from Las Vegas. Originally Zappos was a business like many others, with a traditional, hierarchical organisational structure. But that is in the past. Zappos has chosen a holacratic organisational model: the employees are divided into self-managing teams that collaborate with each other in circles. A circle is called a holon, the Greek word for ‘part of a greater whole’. The goal is complete transparency; hiding behind your title is a thing of the past.

No job titles

The aim is total empowerment: in every circle everyone has a voice and has control over the decision-making process: there are no job titles, no managers, no hierarchy. Everyone has different roles in the circle, including the corresponding responsibilities. This directly links empowerment and leadership: to take responsibility is to show leadership.

Photo: NASA

Anticipating change

Within a circle decisions are taken jointly and openly. But a decision is never an end point, because every decision may put up for discussion again. The underlying principle is that the world is constantly changing and the opportunity to anticipate proactively always needs to be available. This creates an organic course of action, tailored to what is really needed. Tony Hsieh, CEO of Zappos, puts it as follows: ‘Darwin said that it’s not the fastest or strongest that survive. It’s the ones most adaptive to change.

Coordination between circles

For the much needed coordination between the various circles each circle has appointed a ‘lead link’. That is not a leader, but more a coordinator who is monitoring the relations with the other circles. In addition there is a ‘representative link’, a person who connects the circle to the top management. Yet top management stays as far away as possible, and mostly ‘manages by walking around’.  

Great employer

The holacratic organisational model is more than just theory: for years Zappos is known as a pleasant employer. In 2010 the company ranked number 15 on The Fortune 100 Best Companies to Work. A wonderful piece of evidence that work is more than just work. It pays off to give people the space to develop themselves, to have them launch initiatives and to take responsibility. Meaningful work leads to satisfaction and satisfaction is good for business performance. It has been said before in this space: happiness makes any company stronger.

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PostedFebruary 26, 2014, in Step 5: improve & innovate
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