The Six Problems With Holacracy

My disclaimer… (1) I am NOT an expert in holacracy, (2) I love new stuff, and (3) I absolutely love people and concepts that challenge the status quo. That’s that.

Now, before you start this article, please spend 10 minutes reading: thisthis, this, and this.  If reading isn’t your thing (that’s ironic), then watch this. Trust me—it’s important to have some context before reading this rant… ahem, article. Cool? Thanks. Now that we have a relative understanding of what is and isn’t holacracy…

Here are my six problems with holacracy:

  • What happens when things go badly? Holacracy seems to be a scheme that’s built for growth, upmarket, happy times, chaotic-but-generally good times… we’re growing, we’re-taking-over-the-world times. So, what happens when RIFs occur, what happens when bad behavior flares up, who delivers the $h!++y news, who makes the decision who’s going to stay and who’s going to leave? What happens when the secret meetings start to happen? The answer to all these questions is… a resounding… I don’t freaking know… and neither does anyone else. And that should terrify you.
  • Who will and won’t thrive in Holacracy? At first glance, holacracy looks limitless, but it, like every other system, has flaws. People that will thrive in this system will be: (1) people that have a problem with authority, (2) people that can consume ambiguity, and (3) independent thinkers and doers. That sounds like everybody, right? Wrong. Holacracy is a clever attempt to create homogeneity—likeness… and I’m not talking about white people. I mean people that are really similar to one another. They will argue that it’s an efficient system, a lean system, and it will be at the expense of diversity. 
  • What happened to my values—our values? They have been replaced by holacracy. That’s the value system. That’s the code. Kind of seems cultish, right? Well, if it walks like a cult, talks like a cult, sleeps like a cult, burps like a cult… okay you get the point. Truth is, you don’t need corporate values any longer. And for holacracy to truly work… there can be no half measures. Top to bottom, everyone has to drink the Kool Aid. Again for holacracy to have a fighting chance, you have to hire to it, fire to it, live it… each and every day. Bye bye values. 
  • How will it scale? At the end of the day, holacracy might be great for 20 brogrammers in Silicon Valley. But will it work in retail in Tampa? Will it thrive at a hospital in Duluth? Light manufacturing in South Texas? What size company will holacracy work best in and not? What industries will holacracy work best in and not? What geographies will holacracy work best in and not? What about global businesses… i.e., employees with real cultural differences, language differences, etc… will holacracy work there? The answer is three fold: (1) it depends, (2) probably not, and/or (3) nope. Holacracy is a paper napkin idea that might best fit less than 1% of the companies in America. That’s not to say that more companies won’t try it. They’ll just find out the hard way. In fact, someone should go ahead and create the Holacracy Recovery Method, i.e., how-to-get-back-to-business-as-usual manual.
  • How do I manage my career? Wait, the churched up version of that is a term called career pathing. Holacracy is about flatness. Think hierarchy and then think the opposite for holacracy. Sounds good, right? Sounds efficient, right? Well, here’s the problem… actually it’s a dirty little secret: we all want to know what comes next. Maybe it’s our ill-fated love affair with the American Dream. Maybe we believe if we work hard enough that good $h!t happens to us. Dunno. What I do know is that we all—all as in every single one of us—think about the next thing. So, in an extremely flat organization… what the hell is next? Darkness floats about. Maybe this is a shady way to trick twenty somethings into believing that work can actually be different. Again, I don’t know. But if so, those twenty somethings eventually catch on, grow up, get married, have babies and want more money, power and authority. So how is any of that satisfied in an extremely flat organization? In my humble opinion, it isn’t… they go elsewhere. That’s how they’ll manage their own career. They’ll graduate from holacracy.
  • How will they manage bad apples? Truth is, a part of holacracy that I like is the bit about managers. i.e., management without managers. I mean, who doesn’t like that? But after careful thought, it’s actually the wrong war. I don’t hate managers. I fucking hate bad managers… bad bosses… bad leaders. Good / great managers are actually really cool for an organization. That got me thinking: how will companies deal with the eventuality that bad managers (in whatever form) will happen? How will they identify these rotten apples and, more importantly, get rid of said apples? Group think? Call a tribal council meeting? Sounds bureaucratic and slow. If you are thinking of adopting holacracy, dig in and ask tough questions regarding the treatment of bad apples.

Make no mistake about it, this is a new religion. Dropped at our feet is a new Mormonism, new Catholicism, new Judaism. Leaders, ahem, prophets will emerge. Believers will emerge. Doubters will emerge. Those that believe in holacracy will create an “us-versus-them” mentality. On purpose. Mostly, they are ferreting out the weak-minded, the non-believers. That’s how folks will hire. If you understand what holacracy is all about, then you are one of us. If you don’t then, re-join the cavemen and cavewomen.

Oh, and the marketing of holacracy is about to take over our HR worlds. Prepare to be inundated with blog articles (like this one), books, speakers, conference sessions, software apps, etc. If you thought Who Moved My Cheese was good stuff… that was nothing compared to the HR Tsunami that is holacracy. It’s coming people. It’s coming for your hearts, minds and souls. Hearts as in… don’t you want to work in a frictionless work environment? It’s freaking paradise. Minds as in… you’re dumb if you don’t get this “new” way of working and getting stuff done. Souls as in… you’ve lost your belief in mankind… reclaim it here, and this is how to do it.

Holacracy is a pink parakeet in a purple forest. It stands out—for all the wrong reasons.

FOT Background Check

William Tincup
William is the President of RecruitingDaily. At the intersection of HR and technology, he’s a writer, speaker, advisor, consultant, investor, storyteller & teacher. He’s written over 200 HR articles, spoken at over 150 HR & recruiting conferences and he’s conducted over 1000 HR podcasts. William prides himself on being easy to find on The Internet, Google him and connect with him via Twitter, Facebook, Instagram and LinkedIn. Not up to speed in the social media game? Reach out via email. William serves on the Board of Advisors for Talentegy, Wellocity, GlitchPath, Talent Ninja, Universum Americas, Engagedly, Echovate, VibeCatch, Continu, Hyphen, Bevy, Happie, RolePoint, Causecast, Work4Labs, Talent Tech Labs, and SmartRecruiters. He was previously an advisor to PeopleMatter (sold to Snagajob Q2 2016), Good.Co (sold to StepStone Q1 2016), Smarterer (sold to Pluralsight Q4 2014) and a board member of Chequed (merged to create OutMatch Q3 2015). William is a graduate of the University of Alabama of Birmingham with a BA in Art History. He also earned an MA in American Indian Studies from the University of Arizona and an MBA from Case Western Reserve University.


  1. 2014’s buzzword

  2. According to your disclaimer, you don’t know anything about Holacracy besides what you’ve read in the past couple days… so why do you proceed to make a series of bold claims about it?

    Your description of Holacracy is so flat out wrong, I don’t even know how to respond. It’s not grounded in any fact or logical argument, you are simply claiming these things, as if that was enough to be right. If you want to understand Holacracy, it’s not so complicated – ask. At HolacracyOne we offer regular free webinars ( – join in and engage directly.

    Do you know that all the rules of Holacracy are written down in the Holacracy constitution? The secrets you’re looking for are all here: . You can simply read them and critique specific points. Or quote someone who knows about Holacracy, and critique. I’ll be happy to answer any kind of coherent argument based on direct experience, facts, or logical deduction from either of those.

    And a pink parakeet in a purple forest would not stand out at all.

    • Thee best thing about this case is the stylish look and all
      round rugged protection. It is also on thee list of the Seven Wonders oof the Modern World as
      composed by the American Society of Civil Engineers.

      Theyy are the archetypal Caribbean islands without the crowds
      ‘ blinding white sand, aquamarine seas, and long days.

  3. Mary F says:

    Interesting points. The element that stands out to me when reading/thinking about the concept is the fact that people are people. In every “self-lead” group I’ve ever been a part of, there are those who naturally assume a leadership position (sometimes not for good reasons) and those who naturally assume a follower position (again, sometimes not for good reasons).

    I’m interested to see how this all plays out. Matrixed organizations introduced an awful lot of mess into companies, what with their dotted lines and multiple bosses. I’m curious what the long-term impact will be.

  4. Bob says:

    I applaud the fact that you are challenging a concept, but tend to agree with Olivier that you seem to be making rather bold assertions that are mostly opinion and may not be substantiated by fact. One premise you make, for example, is that “we all—all as in every single one of us—think about the next thing.” While (I hope) it is true that people think about the future, we certainly think about the future in different ways. Certainly you know people who think about the future in terms of their title and salary, while others think about the future in terms of interesting projects and personal growth. My recommendation is to look to the early adopters of Holaracy and see their actual results. I agree that Holacracy will not be a perfect solution for all, but then what is?

  5. donald says:

    Holacracy is not the opposite of hierarchy its all about a hierarchies in fact its an attempt at implementing hierarchical structures seriously and is actually a thorough study on enabling natural hierarchies within an organization

    You really need to research before you post something as fact

  6. William, your points are interesting, but I challenge you to change your paradigm. Holacracy is more like an operating system. You do not expect Windows to work with the features of Word or Excel, don’t you? All hiring, firing, people and bad apples are maneged via policies crafted after installing the OS.

    I like the point where you ask who will thrive in Holacracy. In my experience personal integrity and humility helps the most. The more ego there is the harder it ones life will be.

  7. julian wilson says:

    Great points and challenges.
    There is too much evangelism about holacracy.
    At its heart, the good work of Dan Pink (on motivation) provides a good benchmark- autonomy, mastery and purpose. You are right to identify that belonging to a “group or circle” is not the same as autonomy, and substituting your personal purpose with that of the group is also not expressing your values.

    Making this sort of organisational structure work is tough.
    Its early days though, and there is some gold in its mine- and at least someone out there is trying to re-invent the Victorian business model of command-and-control and standardisation which is experienced as dispiriting for most of its employees.

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  9. Mike Parker says:

    I think this is a timely challenge to something which seems to be the latest management fashion. Holacracy to me appears to be presented to us in a way very similar to the evangelical enthusiasm of many other articulations of the need for more flexible and open management structures.

    Holacracy is very far from being the first concept of flattened organisations with a fractal structure.

    I recall when Enterprise Architecture was the “new discovery” about the nature of management and systems that would transform organisations. No one will admit it of course after spending HUGE scads of money on it, but it pretty rapidly turned into a bastion of hideous bureaucracy apparently purposed at decreasing any change. The very opposite of it’s stated intention.

    I think anyone contemplating a big commitment to Holacracy would do well to explore the field a bit first, maybe taking a look mimicry of the human nervous system and brain and possibly digging into some of Gary Hamel’s extensive work in the area (e.g. The Future of Management).

    Bolman and Deal also have very interesting perspectives to offer in “Reframing Organisations”.

    For me there are lot’s of problems with Holacracy and in the end when it comes to management practice I would be terrified of the outcome of someone embracing one point of view with great fervor and running an organisation with it.

    Mike Parker

  10. Ken Kopelson says:

    You talk about values and yet, Holacracy done right has even more values than traditional organisations. You do realise that 80% of all people who work in today’s companies are disengaged, right? That means in the vast majority of companies, the vast majority of people do not value much at all, except perhaps their paycheque. Holacracy in particular, and Evolutionary Teal organisations in general (as discussed in Reinventing Organisations” by Frederic Laloux), place great value on the entire human being coming to work. So totally contrary to your wrong assertions, Holacracy brings the very same values support as one sees in society itself, especially one that operates by a Constitution such as the U.S. What I see in your inaccurate characterisation is a whole lot of unfounded fear, born out of a completely lack of understanding.

    It should be shown that Holacracy is a particular methodology for implementing Teal concepts, much like Scrum is a methodology for implementing Agile Development concepts. Before you go bashing something and calling it a cult, I would highly suggest you go and research this much better. When someone comes along and speaks as brashly as you have all on account of fear-based misunderstanding, it can actually do a lot of harm unjustly. Do you really want to be part of the continuing program of employee disengagement? As an HR consultant, I’m sure you are familiar with the Deloitte study, so you know that HR has to be completely reinvented, right? You really have an opportunity to help humanity evolve in this way. Don’t let fear and self-protectionism rule you. Life is too short for that.

  11. jdfdfs says:

    whats the alternative way to run the company?

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