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Agile, Management 3.0,
Holacracy…
…what next?


Tathagat Varma, 
VP Strategic Process Innovations,
Let’s break something today!

Agile Manifesto

Agile
Management
3.0

Holacracy

Lattice

#NoManager

What
next?

…starting with some mental models…
Why were Pyramids
built?

To preserve the
dead!
Why were Hierarchies built?
Taylor ‘s Prescription, 1911
“I	
  can	
  say,	
  without	
  the	
  slightest	
  hesita3on,'	
  
Taylor	
  told	
  a	
  congressional	
  commi9ee,	
  
'that	
  the	
  science	
  of	
  handling	
  pig-­‐iron	
  is	
  so	
  
great	
  that	
  the	
  man	
  who	
  is	
  ...	
  physically	
  
able	
  to	
  handle	
  pig-­‐iron	
  and	
  is	
  sufficiently	
  
phlegma3c	
  and	
  stupid	
  to	
  choose	
  this	
  for	
  his	
  
occupa3on	
  is	
  rarely	
  able	
  to	
  comprehend	
  
the	
  science	
  of	
  handling	
  pig-­‐iron.”	
  
“Managers
and
Overheads”
Can’t they a bit less
hierarchical?
…a bit more simple,
functional and even a bit
more beautiful?
World’s first
(finest?)
modern org
chart…
NY & Erie
Railroad, 1855
PS: Who is at
top / bottom?
Disney
Org
Chart,
1943
PS:
Where is
the
hierarchy?
h#p://thebuildnetwork.com/team-­‐building/disney-­‐organiza<on-­‐chart/	
  	
  
…and then it got ugly
Agile, Management 3.0, Holacracy...what next?
…real ugly!
Agile, Management 3.0, Holacracy...what next?
Is hierarchy
working after
all?
Let’s start from the
beginning…
…of this century!
Agile Manifesto, 2001
“Build projects around
motivated
individuals. Give
them the
environment and
support they need, and
trust them to get the job
done.”

“The best
architectures,
requirements, and
designs emerge from
self-organizing
teams.”

Never talked about ‘structure’!
So,

who

killed hierarchy then?
It was Scrum that killed
the “Manager”!

…though not the
“management”
Traditional Manager
– Authority
= “Scrum Master”
So, who does the “management”?

The “Team”

Pic	
  -­‐	
  h#p://blogs.seapine.com/2012/02/agile-­‐teams-­‐self-­‐organize-­‐for-­‐project-­‐success/	
  	
  
Has that really happened?

Maybe / Maybe Not!


Hint: just search if companies claiming to be Scrum shops
still hire old-style managers?
Management 3.0, c 2011
“I believe that Agile software
development has overlooked the
importance of (line) management. If
managers don’t know what to do and
what to expect in an Agile
organization, how are they supposed
to feel involved in a transition to
Agile software development? What
is the message of Agile here? If it’s
just “we don’t need managers,” it’s
no wonder Agile transitions are
obstructed all over the world.(Page
27).” 

Management 1.0 
= Hierarchies

Management 2.0 
= Fads

Management 3.0 
= Complexity
“Martie”
What does Management 3.0
mean?
Energize People

•  People are the most important part of an organization and managers must do all
they can to keep people active, creative and motivated

Empower Teams

•  Teams can self-organize, and this requires empowerment, authorization and
trust from the management

Align Constraints

•  Self-organization can lead to anything, and therefore it’s necessary to protect
people and shared resources and to give people a clear purpose and defined goals

Develop Competence

•  Teams cannot achieve their goals if team members are not capable enough, and
managers must therefore contribute to the development of competence

Grow Structure

•  Many teams operate within the context of a complex organization, and thus it is
important to consider the structure that enhance communication

Improve Everything

•  People, teams and organizations need to improve continuously to defer failure for
as long as possible
Holacracy®
•  Holacracy is a real-world-tested social technology
for purposeful organization. 
•  It radically changes 
– how an organization is structured, 
– how decisions are made, 
– and how power is distributed.

•  Is NOT Leaderless!
•  Focus is on work, not people!
How it changes with Holacracy?
In Conventional Organizations
Formal
Structure

“Requisite”
Structure

h#p://holacracy.org/blog/whats-­‐wrong-­‐with-­‐your-­‐organiza<onal-­‐

Extant
Structure

With Holacracy
Holacracy

h#p://bulldozer00.com/2014/01/09/a-­‐risky-­‐venture-­‐indeed/	
  	
  
Agile, Management 3.0, Holacracy...what next?
Agile, Management 3.0, Holacracy...what next?
h#p://ridiculouslyefficient.com/holacracy-­‐do-­‐you-­‐want-­‐a-­‐purpose-­‐driven-­‐and-­‐responsive-­‐company-­‐infographic/	
  	
  
The	
  Corporate	
  LaJce	
  –	
  Cathleen	
  Benko	
  and	
  Molly	
  Anderson	
  
#NoManager / Boss-free
•  Flat / Horizontal Organization, Delayering
•  No or very few levels of middle management
•  Promotes employee involvement 
–  through decentralization and empowerment

•  Rotating Team Leaders – 37Signals, Valve
•  Open Allocation – Valve, GitHub Inc, Treehouse, 
•  No Manager – The Morning Star Company, Gore
“Become
leaders based
on ability to
gain the respect
of peers and to
attract
followers.”
“Relationships
are everything
at Gore”
“Everyone at
Gore has a
Sponsor”

•  Team-based, Flat Lattice since 1958!
•  Revenue: $3B, Staff: 10,000
•  No traditional org charts, no chain of
command, nor predetermined channels of
communication
•  “You will be responsible for managing your
own workload and will be accountable to
others on your team. More importantly, only
you can make a commitment to do something
(for example, a task, a project, or a new
role)--but once you make a commitment, you
will be expected to meet it. A "core
commitment" is your primary area of
concentration. You may take on additional
commitments depending on your interests, the
company's needs, and your availability.”
“We’ve been
boss-free since
1996”
Where	
  Google	
  boasts	
  20%	
  
free	
  <me	
  for	
  its	
  employees,	
  
Valve	
  boasts	
  100%	
  free	
  
<me.	
  	
  
h#p://www.bbc.com/news/technology-­‐24205497	
  	
  

•  400+ employees, $2B-4B revenue?
•  anarcho-syndicalism. Effectively, free association of
employees with one another
•  Valve's basic approach to "managing without managers"
is:
–  hire only incredibly self-motivated people
–  give them full autonomy to decide what project to
work on
–  teach them to spot valuable projects, and to
understand what value they can add to those projects
–  allow team structure to happen organically - teams
self-select, leaders are chosen by their peers
–  encourage people to acknowledge and learn from
mistakes quickly to move forward
–  make everyone responsible together for the success or
failure of projects
•  and finally (and most critically):
–  determine the value and compensation of each
employee by peer review
Agile, Management 3.0, Holacracy...what next?
Founded:	
  1999,	
  Calls	
  its	
  execu<ves	
  
‘Monkeys’	
  
Staff:	
  1500+,	
  Revenues:	
  $	
  2.1B	
  
(2011)	
  
2013	
  Nov:	
  Embraced	
  Holacracy	
  
1-­‐year	
  project	
  that	
  will	
  see	
  400	
  
‘circles’	
  in	
  ‘holarchy’	
  
h#p://blogs.hbr.org/2014/01/a-­‐company-­‐without-­‐job-­‐<tles-­‐will-­‐s<ll-­‐have-­‐hierarchies/	
  	
  
Microsoft is changing…

Satya	
  Nadella	
  	
  
CEO,	
  Microsof	
  

“So how do you create that selforganizing capability to drive
innovation and be focused? …To me,
that is perhaps the big culture change
— recognizing innovation and
fostering its growth. It’s not
going to come because of
an org chart or the
organizational boundaries.
Most people have a very strong sense
of organizational ownership, but I
think what people have to own is an
innovation agenda, and everything is
shared in terms of the
implementation.”
Why are they all changing?
Hierarchies	
  force	
  standardiza<on	
  and	
  compliance	
  –	
  and	
  kill	
  employee	
  	
  
mo/va/on	
  which	
  is	
  big	
  deal	
  for	
  any	
  industry,	
  any	
  company	
  today!	
  
Hierarchies	
  create	
  predictability	
  –	
  which	
  is	
  good	
  in	
  short-­‐term,	
  but	
  
resist	
  change	
  and	
  kill	
  innova/on	
  which	
  is	
  bad	
  in	
  long-­‐term	
  
Hierarchies	
  are	
  too	
  slow	
  for	
  today’s	
  fast-­‐paced	
  VUCA	
  world,	
  and	
  the	
  
leaders	
  must	
  rely	
  on	
  360	
  Degrees	
  of	
  Wisdom	
  to	
  steer	
  their	
  ship	
  
Hierarchies	
  are	
  too	
  costly,	
  especially	
  when	
  many	
  young	
  workers	
  don’t	
  
like	
  “adult	
  supervision”,	
  esp	
  from	
  people	
  with	
  an<quated	
  skills	
  	
  
Hierarchies	
  create	
  func<onal	
  silos	
  that	
  impedes	
  collabora/on	
  and	
  
generates	
  organiza/onal	
  inefficiencies	
  
Other forces…

• Remote workers
• Career progression
• External networks
Working remotely is
good for business!
Agile, Management 3.0, Holacracy...what next?
Horizontal Career
Path

h#p://us.whirlpoolcareers.com/CAREER-­‐DEVELOPMENT/mapping-­‐out-­‐your-­‐career.aspx	
  	
  
Cross-functional
Career Path

h#p://us.whirlpoolcareers.com/CAREER-­‐DEVELOPMENT/mapping-­‐out-­‐your-­‐career.aspx	
  	
  
Ladder vs. Lattice

h#p://www.deloi#e.com/view/en_US/us/Insights/Browse-­‐by-­‐Content-­‐Type/deloi#e-­‐review/e207a920f718d210VgnVCM2000001b56f00aRCRD.htm	
  	
  
The	
  Corporate	
  LaJce	
  –	
  Cathleen	
  Benko	
  and	
  Molly	
  Anderson	
  
This is my
network!
How about
yours?
Adult
Supervision
on-demand

•  Employees want to be left alone
•  But managers should be there when
employees need them!

Horses for
courses

•  Networks for innovation, agility and
speed
•  Hierarchy for efficiency, predictability
and scale

Distributed
and Rotating
leadership

•  Shared leadership and decisionmaking across the board
•  No permanency or carry-over of roles
References
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 
• 

https://en.wikipedia.org/wiki/Managerial_grid_model 
http://www.vroma.org/~bmcmanus/romanarmy.html
http://www.businessinsider.com/microsoft-ceo-satya-nadella-on-microsofts-culture-2014-2
http://ryancarson.com/post/61562761297/no-managers-why-we-removed-bosses-at-treehouse 
http://99u.com/articles/22853/do-we-really-need-managers
http://qz.com/161210/zappos-is-going-holacratic-no-job-titles-no-managers-no-hierarchy/
http://blogs.seapine.com/2012/02/agile-teams-self-organize-for-project-success/
http://www.management30.com/
http://www.slideshare.net/jurgenappelo/management-30-in-50-minutes
http://holacracy.org/constitution 
https://medium.com/on-management/d9a3b82a5885
http://www.valvesoftware.com/company/Valve_Handbook_LowRes.pdf
http://www.gore.com/resources/corporate/en_xx/aboutus/culture/index.html 
https://www.quora.com/Asana/Since-Asana-doesnt-use-titles-how-is-the-organizational-structure-around-roles-and-responsibility
http://www.theguardian.com/business/2008/nov/02/gore-tex-textiles-terri-kelly
http://blogs.hbr.org/2014/01/a-company-without-job-titles-will-still-have-hierarchies/
http://www.forbes.com/sites/sungardas/2014/01/07/is-flat-better-zappos-ditches-hierarchy-to-improve-company-performance/ 
http://www.businessinsider.com/a-company-with-no-hierarchy-that-makes-more-money-per-employee-than-google-amazon-or-microsoft-2012-4
http://en.wikipedia.org/wiki/Flat_organization
http://www.inc.com/magazine/20110401/jason-fried-why-i-run-a-flat-company.html
http://blogs.hbr.org/2011/05/two-structures-one-organizatio/
http://www.inc.com/samuel-wagreich/the-4-billion-company-with-no-bosses.html
http://www.forbes.com/sites/stevedenning/2011/08/12/agility-is-not-enough-beyond-the-manifesto/ 
http://beyondagile.com/
http://www.fastcolabs.com/3020181/open-company/inside-githubs-super-lean-management-strategy-and-how-it-drives-innovation
http://www.fastcolabs.com/3020181/open-company/inside-githubs-super-lean-management-strategy-and-how-it-drives-innovation
http://blogs.hbr.org/2013/11/hierarchy-is-overrated/
http://hbr.org/2011/12/first-lets-fire-all-the-managers/ar/1
http://hbr.org/1990/01/in-praise-of-hierarchy/ar/1
http://hbr.org/2003/03/why-hierarchies-thrive/ar/1

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