Once an organization has all the basics of Holacracy in place, new questions about the organization’s structure often emerge: How do you know what circles an organization should have, and how many levels these should be organized into? How do you define the boundaries between circles and the scope of each? How do you know what specific accountabilities should exist within the organization, which role should own each, and which circle should hold which role? Does it matter? The answer is a strong yes, it definitely does – this is an issue in any organization, with or without Holacracy, but with Holacracy in place these questions really come to the forefront.
Building on the work of Elliott Jaques, Holacracy suggests that an organization has a natural or “requisite” circle structure at any given point in time: “that which wants to emerge.” And within that circle structure there is a requisite breakdown of roles and accountabilities. This requisite structure is a natural holarchy that has emerged over time and will evolve with time – it is not simply an artificial construct or arbitrary choice, and it may or may not match the formal structure we’ve decided upon. Finding this requisite structure is detective work, not creative work – the answer already exists, it just needs to be uncovered. This discovery process feels a lot less like explicit design and a lot more like listening and attuning with what reality is already trying to tell you – what naturally wants to emerge.
The benefits of doing this listening are significant. The closer our explicit structures mirror these natural structures, the more effective and trust-inducing the organization becomes, and the easier dynamic steering becomes. As we align with the requisite structure, the organization feels increasingly “natural”, and self-organization becomes easier. Circles feel more cohesive – they have healthier autonomy and clearer identity, and more clear-cut interplay with other circles. Each circle more easily owns its work and work processes, with its super-circle able to more comfortably focus on specific inputs and outputs rather than the details of the processing going on within. Roles and accountabilities become more clear and explicit, and it becomes easier to match accountability to control.
So once you’re practicing Holacracy, how do you align the organization with its requisite structure? Simple: Just listen and practice. The tensions will guide you towards the requisite structure, and with Holacracy in place you already have a system that processes tensions into organizational evolution. Getting closer to the requisite structure is only a matter of time.
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