Holocracy at Zappos
Zappos, an online cloth and shoe company in 2013, announced the adaptation of holocracy system. Holocracy refers to a management free type of organization where no ranks are given to the employees. It is a movement that intends to change corporate America. Zappos in the past had boss and managers in the organization. After the introduction of holocracy the hierarchy of management was eliminated, and each employee is equal to the other. Over time Zappos had weaned the entire off the traditional policy of having bosses.
The main concept of holocracy is to make the employees become proactive rather than being reactive in their jobs. Employees can describe their job because they work together as a team. It helps create teamwork among the employees, and they felt more connected to the organization. Holocracy also enabled employees to gain new skills. Since no one is restricted to work in a given depart, employees can improve their skills. It reduces removed the concept of an employee-only sticking to a single department because of their rank according to Zappos CEO MR. Tony Hsieh, the main concept is to bring about autonomy, agility and honesty.
According to Hsieh, holocracy was supposed to give Zappos an added advantage over its competitor. Through this system, the employees work together as a team and each act to the best of the ability. It eliminates the concept of waiting for someone else to do something because it is in their department. Holocracy enables each employee to act at their best because they are allowed to make a decision as a team. The system should make employees happy because they are giving the right to decide on their own. In the long run, the system was to help the workers gain more skills and follow their passions outside their role. With happy employees, Hsieh expected an increase in performance of Zappos.
Latter on Heist then discovered that holocracy did not yield the required results. First, it caused confusion among the employees who could not make a decision on their own. Some of the employees needed someone to manage them and give a job description of what they should do. A good percentage of employees also quit because they felt they could not understand the new system. Eventually, it led to poor performance, and Zappos dropped from a position on the online loth selling companies. After some of the employees quit because they felt they did not reach feet with the new system, Heist was still hopeful that the desired results would be attained.
Holocracy, which was meant to create collaboration among teams, improvement in Zappos performance and enthusiastic employees ended up doing the opposite. Despite some employees feeling that the system helped them fill their full potential, most of them ended up feeling they lacked direction. It led to poor performance because there are no descriptive roles given to employees and no pressure to attain any goal. More employees lacked collaboration, and some opted to quit. However, this did not change the Heist mind. He still believed that the desired results will be attained and that the employees that quit had another reason for quitting. Zappos introducing holocracy in 2013 had a lot of expectation of improving its performance. However, through the poor results obtained in 2016, it proved that it might not be the best system to adopt as an organization.