System in which everyone works for himself

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Gore, a highly diversified manufacturer; and, of course, Zappos. Both because its formality makes it somewhat easier to pin down and examine and because it has been implemented more often and at greater scale than other designs, we focus significantly on it in this article. Within them, individual roles are collectively defined and assigned to accomplish the work.

As in traditional organizations, there may be different teams for different projects, functions finance, tech, sales , or segments customer, product, service. But self-managing enterprises have a lot more of them—the overall organizational structure is diced much more finely. After Zappos implemented holacracy, departmental units evolved into circles. The modularity allows for more plug-and-play activity across the enterprise than in a system where teams sit squarely in particular units and departments.

Some teams are more fleeting than others. As new goals, tasks, and initiatives emerge, individuals create circles or pods or cabals to tackle them. For example, St. Although self-organization largely avoids traditional patterns of hierarchy, teams are nested within a larger structure, which they have a hand in shaping and refining.

Holacratic organizations ratify a constitution—a living document outlining the rules by which circles are created, changed, and removed. It explains in a broad-brush way how circles should form and operate: how they should identify and assign roles, what boundaries the roles should have, and how the circles should interact.

These outline responsibilities, activities, and overall goals and contain highly detailed metrics for evaluating performance. In self-managed organizations, leadership is distributed among roles, not individuals people usually hold multiple roles, on various teams.

Leadership responsibilities continually shift as the work changes and as teams create and define new roles. Technology is essential for keeping these changes straight. In a holacracy, for example, enterprise software such as GlassFrog or holaSpirit is typically used to codify the purpose, accountability, and decision rights of every circle and role, and the information is accessible to anyone in the organization.

Transparency enables cross-team integration; all the thinly differentiated roles are easier to find than they would be in a traditional organization. Leadership responsibility belongs to the roles, not to the individuals in them.

Authority may be contextual, but it does exist. Of course, assigning roles is work in itself. In more loosely defined forms of self-management, such as podularity, roles are flexibly reassigned, but it is left up to the organization to figure out how. These three characteristics add up to an organization that is responsive to the requirements of the work rather than to the directives of any powerful individual.

Traditional management goes wrong when the boss gets to prescribe what must be done—or how—because of a job description, not because he or she has particular insight into what will produce the desired outcome.

Self-managed organizations strip away much of this ability to prescribe, using structuring processes rather than a fixed structure to maintain order and clarity. Recent experiments with self-managed organizations have zeroed in on a few ways of improving performance. In each area, they have seen success but also problems. In self-managing systems, individuals have portfolios of several very specific roles Zappos employees now have 7. Negotiating with one another, employees allocate duties to those best suited to carrying them out.

The process lets individuals play to their strengths and interests and serves as a safety check against roles that might be useful to one person but harmful to the team or the organization. This approach to role design gives people room to grow on the job. Consider Ryan, a software developer at ARCA, a global manufacturing and services company where one of us spent more than a year observing the implementation of holacracy.

No one in the circle thought this would cause any harm, so the role was created and the lead link assigned it to Ryan, who also continued to fill the software developer role. A recent law school graduate, he had little business experience but showed great potential with his legal and analytical skills. His versatility allowed him to take on multiple roles at the growing company, in sales, legal services, and operations.

However, as he worked across functional groups, he felt his contributions were getting lost in the organizational structure. He thought his value was more clearly recognized, which gave him even more confidence to initiate changes and make decisions. How did Karl fit all this work in? For instance, he used the structuring process to carve out some administrative responsibilities and pitch them as a separate role, which the lead link filled with an enthusiastic new hire.

Although this shift in responsibilities was initiated by an individual contributor, not by a manager, it was highly formalized and official. The upside of designing roles in this way is straightforward: Because employees are driving the process, they have a greater sense of making real progress on meaningful work.

These factors are strongly associated with creative problem solving, motivation, and engagement. Assuming that the connection is borne out, is the shift from traditional jobs to a larger number of microroles a net benefit? Possibly—but role proliferation has costs, too. It creates three kinds of complexity, all related to human capital:. First, it complicates actually doing the work, because employees struggle with fragmentation.

A significant body of literature on goal setting aptly summarized by Marc Effron and Miriam Ort in their book One Page Talent Management finds that employees perform less well on each goal as they take on more beyond just a handful. At Zappos, each of the 7.

People grapple with where to focus their attention and how to prioritize and coordinate across circles—even with simple scheduling issues. The company is exploring crowdfunding models to replace this top-down budgeting. And each Zapponian gets a budget— points to allocate as he or she chooses. The system serves as a marketplace for the work that needs to be done, allowing a person to work across multiple teams without being told where to work.

It also puts the onus on employees to fill their time with valuable roles. Second, having so many roles complicates compensation. As people assemble their personal portfolios of roles, it becomes difficult to find clear benchmarks or market rates. For instance, what would you pay someone who divides her time between developing software, serving as the lead link for a software development team, working on marketing strategy, creating internal leadership training, doing community outreach, and planning events?

Zappos is experimenting with basing compensation on the acquisition or application of its skill badges. But the complexity is still daunting. Third, role proliferation complicates hiring, both into the organization and into particular roles.

Although new employees are brought on to meet specific needs, they quickly start adding other roles to their portfolios. Given that volume, the company developed Role Marketplace, a tool to quickly post open roles and manage applications, with lead links ultimately deciding who fills the roles. The tool handled almost a quarter of those 17, assignments. Using both People Points and Role Marketplace, an employee could potentially find, apply for, be assigned to, and start working in a role within a single day.

An adequate water supply, for example, is a common good from which all people benefit. But to maintain an adequate supply of water during a drought, people must conserve water, which entails sacrifices.

Some individuals may be reluctant to do their share, however, since they know that so long as enough other people conserve, they can enjoy the benefits without reducing their own consumption.

If enough people become free riders in this way, the common good which depends on their support will be destroyed. Many observers believe that this is exactly what has happened to many of our common goods, such as the environment or education, where the reluctance of all persons to support efforts to maintain the health of these systems has led to their virtual collapse.

The third problem encountered by attempts to promote the common good is that of individualism. Our historical traditions place a high value on individual freedom, on personal rights, and on allowing each person to "do her own thing. In this individualistic culture it is difficult, perhaps impossible, to convince people that they should sacrifice some of their freedom, some of their personal goals, and some of their self-interest, for the sake of the "common good. Finally, appeals to the common good are confronted by the problem of an unequal sharing of burdens.

Maintaining a common good often requires that particular individuals or particular groups bear costs that are much greater than those borne by others.

Maintaining an unpolluted environment, for example, may require that particular firms that pollute install costly pollution control devices, undercutting profits. Making employment opportunities more equal may require that some groups, such as white males, sacrifice their own employment chances.

Making the health system affordable and accessible to all may require that insurers accept lower premiums, that physicians accept lower salaries, or that those with particularly costly diseases or conditions forego the medical treatment on which their lives depend.

Forcing particular groups or individuals to carry such unequal burdens "for the sake of the common good," is, at least arguably, unjust. Moreover, the prospect of having to carry such heavy and unequal burdens leads such groups and individuals to resist any attempts to secure common goods.

All of these problems pose considerable obstacles to those who call for an ethic of the common good. Still, appeals to the common good ought not to be dismissed.

For they urge us to reflect on broad questions concerning the kind of society we want to become and how we are to achieve that society. They also challenge us to view ourselves as members of the same community and, while respecting and valuing the freedom of individuals to pursue their own goals, to recognize and further those goals we share in common.

Bellah, R.