Modern Management: Holacracy vs Hierarchy Organization Structure

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Holacracy vs. Hierarchy

Modern Management: Holacracy vs Hierarchy Organization Structure

What is Holacracy?

Holacracy was originally developed by Brian Robertson in 2007. Since then this spark of an idea has spread like wildfire, having been adopted by many startups and even some larger companies like Zappos.

[ideabox]Though it’s a complicated concept, its main idea is simple: eliminate all hierarchies and job titles in organizations, and replace them with a formal structure that is fully focused on getting the job done. Holacracy introduces a strict and comprehensive set of rules that enable everybody, regardless of seniority, to make quick, smart decisions that are in line with the organization’s goals. [/ideabox]

In its full form, Holacracy is a complex and sophisticated set of rules guiding organizational conduct. Adopting it requires companies to change their meeting practices very profoundly, so a significant amount of training is needed to teach everyone the new rules of the game.

How does Holacracy work in practice?

Based on rigid, boring hierarchies, the traditional workplace structure—known as“command and control” management—has been around since the Industrial Revolution.

Under this system, employees operate strictly within the realm of their own department and job title, completing tasks as assigned by those above them in the hierarchy. There’s little room for innovation or independent thought.

Holacracy gets rid of all of this. Instead of job titles, people take on flexible, ever-changing roles according to their skill sets and the current demands of the company.

[warningbox]Job titles are killing your business use ROLES instead.[/warningbox]

Managers in the traditional sense are a thing of the past too. With Holacracy, people are given the independence to pursue their roles in the best way they see fit.


Another tenet of Holacracy is that instead of departments and divisions, companies are made up of circles. At first glance, a circle is basically a team comprising different roles. The key difference to traditional departments is that circles are very flexible.

Just like a department, each circle has a clear purpose: a topic vital for the company’s success which the members of the circle work together to pursue. However, this purpose can be easily changed if it no longer reflects the company’s strategy. Circles can also be created or closed in a single meeting, very much unlike Command and Control departments.

 Below diagram illustrates differences between traditional Hierarchy and Holacracy organization Structure.

Holacracy vs. Hierarchy

References: Holacracy and self-organization



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