Sociocracy on the Human Organization Map

The Human Organization Map has been published two years ago to offer an accessible, constantly evolving but yet, as much comprehensive as possible, framework for firms to critically explore and reflect about the numerous options (Holacracy, Sociocracy, Teleocracy, Aequacy, Teal, etc.) and real life experience (Buurtzorg, Spotify, ING, etc.) available for inspiring an organizational design that is more inclusive, agile, adaptive, human friendly and, all in all, at par with the relentless disruption we see outside.

Back then, I had demonstrated how the Map could be leveraged to validate the strengths but also the potential blind spots implied by Holacracy. Together with a long list of dimensions (such as reason why, strategy, leadership, power distribution, planning, organizational structure, management style, work allocation and influence) on which the innovative contribution given by Holacracy was substantial, the analysis evidenced some more subtle and easily ignored characteristics such as the lack of attention to psychological and cultural needs or the philosophical beliefs underpinning its practices. Such choices explained a surplus of attention to Operations (organizational structure, governance, policies, metrics, roles, rules, etc.) and much less on Resources (assets, locations, tools, funds, ownership, etc.), and People (employees, partners, suppliers, customers that create value together).

Sociocracy in short

After those introductory articles, I had the possibility to nurture my understanding and practice of major Holacracy’s sibling Sociocracy or Dynamic Governance. As its name reveals, Sociocracy means “governance by those who associate together” or the members of an organization.

The name comes from 1851 through French philosopher August Comte’s vision of a scientific method applied to society for a “social order of the future”. In 1881 American sociologist Lester Frank Ward embraced it as a more advanced form of government, while Kees Boeke introduced consent-based principles inspired to Quaker communities into the first sociocratic school between 1926 and 1954. In the 1970s, Gerard Endenburg, a former student in this school, added ideas from engineering and cybernetics to develop the Sociocratic Circle-Organization Method (SCM) for his family’s company, Endenburg Electrotechniek. Sociocracy kept quietly spreading into the Dutch world, until Jon Buck and Sharon Villines made it accessible to the English-speaking world through their book We the people in 2007.

In a nutshell, Sociocracy is both an approach for designing organizational structures and decision making that builds on 3 principles:

• Effectiveness = having evidence that what the team does actually generates impact (i.e. helping the organization to move forward).
• Equivalence = not everybody is identical but everyone’s voice is heard to exercise “power with” rather “power over” others.
• Transparency = every piece of information or decision is shared publicly, without political games or secret plots, based on informational asymmetry.

At its core, Sociocracy allows small and large groups (for-profits, non-profits, coops, schools, communities) to self-organize by achieving both speed at addressing goals and the ability for each member to contribute according to his / her abilities and interests. It does so by structuring organizations into fractally nested circles (groups of individuals with a clear mandate, areas of responsibility, membership and roles), connected one to the others (through a double linking mechanism made possible by having both a leader and a delegate / representative) and making decisions through consent (by systematically looking for and including objections the team has, instead of searching for consensus or having a boss autocratically imposing a decision). A more detailed intro can be found in this video from SociocracyForAll or in the Many Voices One Song book.

My questions on Sociocracy

For someone with previous experience in Holacracy, my first question was obviously how Sociocracy differed from it, both in terms of explicit practices and, less visible but maybe not less relevant, implicit assumptions. In this post, I decided to use Holacracy as a magnifier of Sociocracy’s specificities.

In order to understand that, the aspects I wanted to explore were:

1. The view of the man and of the organization underpinning the intent the approach means to support.
2. How purpose (the reason for the organization to exist) is operationally translated into policy making and tactical activities within circles.
3. The kind of support Sociocracy provides to self-management (empowering teams to autonomously decide how to achieve their goals) and self-organization (enabling the organization to change itself by introducing new circles, evolving the existing ones or assigning in-circle responsibilities to other individuals).
4. To what extent hierarchy is still present in a framework inspired by living systems, continuous improvement, interdependence, empiricism, adaptability, emergence.
5. Its resonance with more or less progressive forms of management (e.g micromanagement vs total trust).
6. The level of attention, if any, attributed to the dimensions of individual development in the bottom part of the Human Organization Map (incentivation, fairness, self expression, people development, ownership)
7. Any direct or indirect hint Sociocracy may bring to new forms of ownership and incorporation.

My answers are summarized below, with the added bonus of a comparison between my understanding of Holacracy (triangle in red, where its assessment differs or barred when the dimension is not addressed at all) vs Sociocracy:

Let’s go straight to the first point.

Is Holacracy fundamentally the same as Sociocracy?

Yes and no. While many of the practices that Holacracy uses are indeed inspired by Sociocracy (and I feel a bigger tribute should be paid to it), I must agree with Brian Robertson on the fact that the deep, fundamental, implicit beliefs and worldview underpinning them cannot be any more different. In Brian’s own words:

Sociocracy is a governance method to govern people; Holacracy is not; actually, there’s a rule in the whole system; people are not even allowed to be governed by it. Holacracy is a governance system for an organization around structuring the organization.

What it means is that until you superficially stop at rounds, circles, double linking, objections and decision making, even most of the language used in meetings, differences may not become apparent but the very goal (or purpose?) that Sociocracy and Holacracy are meant to address in the world are at the opposites:

• Sociocracy is a governance system to empower each team to flourish and contribute towards the organization mission. Governance here mostly means collaborative decision making. Its foundations are in human living systems, their agency, their search for connection, belonging, equivalence, common purpose. Very specifically, equivalence (everyone’s needs matter) is not seen in a trade-off but in a mutual reinforcing relationship with effectiveness. It’s a both-and community-centric view that balances the needs of the group with those of the individual. No one can be ignored and this doesn’t come at the expenses of value creation. The I and the We uniquely go hand in hand. Sociocracy is not a neutral governance system. Everything in it exposes a loving attraction to precise values of egalitarianism, transparence, inclusion, respect, feedback, conscious capitalism. Sociocracy delves quite a bit into feelings as a pointer to unmet needs and invitations to connect. Its roots in non violent communication and intentional communities are visible. McGregor would say Sociocracy adheres to Theory Y.
• Holacracy is a governance system for the organization to achieve its purpose. Governance here means distributing authority / responsibility, to let individuals know who can do what within what limits outside of governance meetings. This is a major dissimilarity. Human beings and their sometimes dysfunctional behaviours are inherently (as good or bad it may look to you) seen as a drawback to the efficiency and speed of the organization. Its mindset is rooted in algorithms, simple / scalable rules and computer science. Its facilitation techniques are designed to cut off any deviance from the rules of Holacracy Constitution (the book of rules everyone, especially the top authority in the organization have to sign off). Decision making happens primarily through the explicit, rich, formal set of prescriptions described in the Constitution than through what individuals decide with Integrative Decision Making (IDM, Holacracy version of consent). IDM is used only to extend the starting point given by the Constitution, in terms of distributing authority, for the specific conditions of the organization we are in. Quoting my own analysis of Holacracy:

Human needs, feelings and development are not really key to Holacracy’s philosophy, as the central goals are organizational flexibility and efficiency. This is very much in line with the idea of “a governance process of the organization, through the people for the purpose”, instead of “a governance of the people, by the people for the people”. Holacracy decouples people and human relationships from the organization of work. It actually protects the organization from political turfs, fiefdoms, hidden agendas, psychological pressure, the willingness to go around or bend the rules. Its “operating system” encodes and enforces the directives making such dysfunctional behaviours very difficult to perpetrate. Personality and work are formally disconnected from each others to increase clarity (everybody knows what has to be done, how and by whom). This comes at a cost though: human beings become cogs in the system with their space for expression, interaction, relationship strongly limited. In a nutshell, human relationships are left, on purpose, out from Holacracy. … Holacracy is convinced that human traits are what makes work inefficient and that removing them from the picture is the only solution ahead.

The implicit assumption here is that, on one side, governance should stay away from infusing any value or judgement on what organisations have to achieve (you can still build very hierarchical, opaque, unequal dynamics through Holacracy) but, at the same time, it should also sterilise humanity by moving authority into a new space called organization governance as the only means to achieve maximum performance at identifying and resolving tensions. People and the organization are intentionally decoupled. McGregor may say Holacracy feels the urge to constrain individuals to adhere to Theory Y.

Together with many areas of commonality, Sociocracy thus diverges from Holacracy regarding the dimensions below:

• Decision making: the decisions that in Sociocracy are made by consent, within the range of personal tolerance of circle members, in Holacracy are made by raising objections, purely on the impact of the decision on the organisation ability to progress towards its purpose. The validation and integration of objections in Holacracy is strictly codified. People needs, preference or tolerance are not taken into account in any way. Two widely distant, both powerful point of views. Score 7.5/10.
• Information visibility: transparency is declared as a pillar in Sociocracy. It is strictly required to achieve clarity (about what to expect), to enable agency (if you don’t know, you cannot act), to allow participation and equivalence (power is in those who do the work and you can contribute only when you are aware of who is doing what and have access to information), to generate learning opportunities (not explicitly addressed in Holacracy). Score 7.5/10 as no specific indications are provided for how to bring transparency into action at the enterprise level (on top of having a secretary to keep minutes in the circle and a logbook with all the policies of the organization).
• Organizational structure: even basic constructs such as circles in Holacracy have no reference to people. What they are is a function or a cell of the organization with accountabilities and domains that are entirely independent of the people fulfilling them. Circles have “no responsibilities” for action in Holacracy. Individuals do. Instead of giving suggestions that are approved by consent in the circle, individuals are requested to step outside of their personal identity to act as sensors of tensions (gaps between current reality and an ideal state) on behalf of the organization and its purpose. Actions to fill the gap are assigned to individuals. Score 7.5/10 as the structure is not flat (hierarchy of specificity among circles not people).
• Management style: while Sociocracy still has the role of a leader in each circle, the large set of shared values at its genesis and a softer / more empathic facilitation style, make it easier for the team to work in quite a relaxed and horizontal way. On the other side, a much less formalised distribution of authority (who can do what and who can decide what at the operational level within the circle), makes it harder to see when the leader has to step in or when members can act in full autonomy. Score 8/10, as a real self-management is not yet available in Sociocracy.
• Work allocation: connected to the point above, elections (selections in Sociocracy language) for circle roles (such as leader, delegate, facilitator and secretary) are generally let to the team, not to somebody in a higher circle. Also operational roles (those specific for the work to be done) are elected by the circle through consent in Sociocracy. Even in those cases in which a role is decided from above, the accepting circle has to approve by consent (and viceversa in the higher circle). The difference is particularly stark with Holacracy here, as both the leader and individuals filling operational roles are chosen from the top (the higher circle and the leader). Another major distinction is how clearly Holacracy separates governance activities and meetings, those meant to attribute authority through integrative decision making, and tactical ones, in which less interdependent and more autonomous work without any shared decision making is expected. For Sociocracy, I consider a score of 8/10, as individuals still cannot decide autonomously which roles to pick (open allocation).
• Self expression: the worldview Sociocracy comes from and represents speaks loud about individuality, feelings, a need but also a safe space for showing that part of ourselves that remains most often hidden in the office. The language used in facilitation is meant to make any voice heard and integrated into decision making, while still giving individuals full responsibility to satisfy their own personal needs (this dimension is entirely missing in Holacracy). Scores is 7.5/10 as the effect is more accidental than intentional.
• Ownership: the Mission Circle is in Sociocracy not just a purpose keeper but also a powerful direct bridge to all of the company’s stakeholders (employees, co-owners, funders, customers) and potentially to representatives from other organisations. Together with consent-based decision making, this means power cannot be exercised over but only with all the constituents and that the firm owns itself, even in absence of formal mechanisms for inclusive ownership. Sociocracy thus complements very well other approaches such as steward ownership or for-purpose enterprises that are still required to encode progressive incorporation forms. Score is 6/10.

How does Sociocracy score overall?

I would argue the comparison we just went through also helps with some of the original questions above, especially with the view of the man and of the organization (Q1), resonance with more or less progressive forms of management (Q5), new forms of ownership and incorporation (Q7).

A few additional thoughts are thus in order for the remaining aspects:

• Reason why (Q2): in Sociocracy, purpose or more precisely aims are considered as beacons to operationally guide policy making and operations at all levels of the organization. The overall aim (what the organization exists for) is intentionally defined, cured and protected by the Mission Circle. More than a board, this is the place where the firm can nurture its core while also connect and resonate with same-minded third parties and individuals. The long-term, strategic view is complemented by taking that aim and fractally splitting it in the aims of each other circle and sub-circle. My assessment for the score on reason why is 7.5/10, due to the very concrete (but potentially less transformational and far-fetching) appreciation of purpose Sociocracy has.
• Self-management, self-organization and hierarchy (Q3 and Q4): much like in Holacracy, Sociocracy empowers individuals to act autonomously in order to get their work done according to the roles and circles they belong to and the teams to evolve the circles structures, based on the emerging needs they perceive. Even if trust, shared values and double linking naturally hint to a servant, more inclusive version of the leader (and of the delegate), circle roles still give the feeling of a bit of distance between circle members. At the same time, Sociocracy believes in equivalence, not sameness. Individuals are invited to bring their unique mix of competencies and interests. That’s why differences in responsibilities and hierarchy, of domains and specificity, not of people are very much present in Sociocracy. Score is 7.5/10. Does this contradict or prevent continuous improvement, interdependence, empiricism, adaptability, emergence? Not really.
• Individual development is potentially the area on which Sociocracy tacitly diverges from Holacracy the most. Important aspects such as equivalence are at the core of the approach. Others, such as self-expression and ownership, are subtly addressed. Finally, some like people development and incentivation only attract a small amount of attention. Still well beyond each dimension and even the completeness of the support provided, it is here that Sociocracy confirms his distinct take and mix of perspectives to organizational design.

Conclusions

One thing is clear to me at this point: the unwritten rules hidden deep into the core of Sociocracy and Holacracy have been developed and evolved from diametrically opposite points of origination, to the extent that they may not be easily reconciled. There is more than the practices for the distance to be appreciated. Ignoring such philosophical clash would reduce a paradigm shift, that I see in both the approaches, to a mere question of checklists and language. Brian Robertson believes Holacracy can be seen as a more specialised, extended version of Sociocracy. I believe this not accurate as it would mean ignoring the values (especially transparency and equivalence) that Sociocracy intentionally and distinctively brings. Sociocracy strives for a sense of community and family erring on the side of more leanness and less structure, where Holacracy pushes for autonomy and differentiation through more clarity and bureaucracy, with integration only when strictly necessary. Different cultures may prefer one or the other.

I find it true, instead, that Sociocracy can be perceived as much more accessible to traditional organisations, due to its higher modularity (e.g. you can borrow a single practice, let’s say rounds, without signing up for an entire constitution), its less dogmatic taste, the easier syntax and a shorter stretch from existing habits. Similar characteristics are a magnificent, non-threatening opportunity for more conventional cultures, mindsets and industries to quickly upgrade their ability to achieve results by evolving company structure gradually and from the edges.

On the other side, the work at differentiating governance and operations as moments in organizational life that require different tools, efforts and solutions (e.g. decision making approaches) may probably be a welcome addition to Sociocracy. A crispier distinction between power distribution and decision making would increase effectiveness, autonomy and engagement, without compromising on equivalence.

All in all, the question that really still stands out for me is “can you achieve a purpose treating people like a drawback?“. Holacracy believes you must. Sociocracy considers it an oxymoron and a false dichotomy. The jury may still be out on this one. Nonetheless, I personally believe effectiveness requires transparency and equivalence, not just in businesses but even more in an increasingly fractured, frightened and disconnected society, like the one we are currently living into. That is the distinctive value that Sociocracy has to offer.