Monday, February 8, 2016

Checking in on Zappos’ Holocracy Movement

Back in May, I wrote a blog about Zappos’ bold move to embrace a no-manager model. While a drastic tactic, I have always been a fan of moving away from the archaic managerial role and more toward one that revolves around coaching and development.

As part of Zappos’ strategy, CEO Tony Hsieh’s offered a severance package to employees who were not sold on the new direction. That’s how strongly he believes in the concept.

So, I was curious to see how things would take shape after some time and this recent Washington Post article providing an update immediately caught my attention.

By May, roughly 14 percent of the staff left and that number increased to 18% to date (that’s 260 people).

Chief operating officer Arun Rajan said “the majority of the recent group who left are managers who didn't fill critical roles within a company that no longer has traditional supervisors, as well as that it might have had to do some layoffs if there weren't enough people who took the buyout offer.”

Rajan went on to say, “While we have lost a number of folks, it is important to note that we have a significant group of highly talented individuals who will be staying to help move Zappos forward.”

What I think is most important to recognize in all of this, is that Hseih is totally committed to this progressive movement. He’s taking a huge, calculated risk and attempting to change the way organizations everywhere view the role of managers. While he knows he will lose employees, he’s choosing to focus and invest on those who stay and believe in his vision.

Hseih’s motivation behind pushing the idea of Holocracy is “to make Zappos's customer service the brand hallmark that helps him grow into other industries, much like Virgin's ‘hip and cool’ brand led it beyond music and into other fields.”

This is no doubt a hot button topic and I am looking forward to watching the continued progress, the challenges, the failures and the successes.

Regardless of where you stand on the issue, I find it hard to not respect Hseih’s level of commitment to trying something completely unorthodox and standing behind it. Leaders like Hseih show us that sometimes you don’t know what will happen unless you are willing to take a leap of faith and take action that will truly shake things up.

Where do you stand on the issue? I’d love to kick off a dialogue, so tweet your thoughts to @GaryMagenta using #HowIFeelAboutHolocracy





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