First ‘Rank and Yank’, and now ‘Holacracy’

Why HR needs consistency no matter what the culture or latest policy

Innovation and new approaches to HR are well documented in the press, with Yahoo’s Marissa Meyer taking the most newsworthy, and controversial stance of last year, by encouraging a ‘rank and yank’ culture.

So far, the first HR story to break this year is about as far from ‘Rank and Yank’ as you can get: Zappos Is Getting Rid Of All Job Titles And Managers.

In this latest news, Zappos’ CEO Tony Hsieh has announced the company will be scrapping managers and hierarchy among its 1,500 workers in favor of something called a ‘holacracy’ – a working world where there are no managers and the company is structured around the work that needs to be done, rather than the people who do it.

In this ‘super-flat’ company, different jobs and areas of responsibility (i.e. finance, HR, IT) organize themselves in ‘circles’. It is these self-organizing circles that are the key to the system’s flexibility as they can set their own purposes and redefine at any time.

In essence, this has the potential to be a beautiful, innovative, and flexible method of working, where each employee is able to work to their strengths for the benefit of the company. However, Zappos have had to utilize a specialty software platform to ensure that all the circles, tasks, and people are connected to each other and vital tasks are not omitted.

To think that such software requirements are limited only to the more obscure and unusual HR challenges would be wrong. In today’s rapidly changing markets, where companies and their employees have to remain flexible at all times, automated, intelligent platforms are becoming a necessity. This is especially true in international companies that must achieve local compliance in each region and provide global consolidation to Head Office.

Returning to Zappos and its brave new world, there is one overwhelming unanswered question (as well as several others, Zappos is saying that more details will need to follow): in the absence of a management team, will the staff be setting their own salaries and benefits? They’d best cancel those company car orders from Lamborghini, because the answer is an emphatic ‘no’.

It seems that even the most laissez-faire management practice will still be in great need of consistency and structure through intelligent HR systems for the foreseeable future.

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