Episode 37: Holacracy: A New Form of Governance with Eric Graham

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Eric Graham shares his knowlege and experience with a progressive system of organizational governance called Holacracy. We learn that it is a form of governance that takes into account each individual's perspective and truth, by having information flowing up and down the organization. He explains the different layers and core principles of how holacracy works. Eric teaches us that the responsibility and accountability of each person is important to have effective decision making, a clear agenda and the evolution of the organization.

Transcript

Woman: This program, brought to you by PersonalLifeMedia.com, is suitable for mature audiences only and may contain explicit sexual information.

Man: This interview was recorded at the One Taste Center in San Francisco on October 16th, 2007.

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Monique DeBose: Hello, everyone. I'm Monique DeBose and this is “A Taste of Sex: Guest Speakers Series” coming to you from One Taste Urban Retreat Center here in San Francisco. Each week on the show, we host people whose work challenges the status quo of our mainstream culture, real trailblazers. Our guest tonight is Eric Graham who's a consultant for HolacracyOne. He's a Web project manager and is also completing his Master’s in Integral Psychology in the moment. He’ll be speaking tonight at One Taste as part of our Hybrid Practice Lecture Series, which happens every Tuesday night here in San Francisco at 1074 Folsom Street in the heart of the city.

[musical interlude]

Monique DeBose: So we all know how governments work or businesses or organizations. There's some sort of hierarchy where most positions have a limited amount of power and there's a person at the top who makes the final decisions and the buck stops there. But what about in a community where the idea is to integrate each person’s perspective into the whole? Is there chaos? Can it work? It's something we're experimenting here with One Taste where 45 people live and work together everyday.

[musical interlude]

Monique DeBose: So holacracy is an interesting concept. As I get it, it's a progressive way to organize a system such as One Taste community or an organization or a business that’s breaking away from this idea of traditional hierarchies. So Eric, what is it about holacracy that’s so intriguing to you, and if I'm just real, what is it?

Eric Graham: Well, that’s a good starting point, I guess. It's tough to roll it up into a nutshell and really give a good sense of what holacracy is, so we will take sometime and maybe go on with the different layers of it. But from the highest level, it's a system of organizational governance so it's both a structure that you can apply to any organization and a process for executing business. What really appeals about it to me are really it's some of the core principles that are behind holacracy that actually help and form the structure and the process that are in place.

Monique DeBose: So what are those?

Eric Graham: Some of the core principles are dynamic steering, which is in contrast to predict and control governance which is what we're normally used to. In an organization, specially in business, you might look a year out, three years out or five years out and try to predict what you want to happen and actually try to control as many variables as possible in order to achieve your target. Holacracy, on the other hand, with dynamic steering, it tries to take more incremental steps and try to actually make smaller decisions in less amount of time and actually be open and present to data as it arises and as it comes up and then make smaller decisions along the way.

Monique DeBose: So there's no long term goal then?

Eric Graham: There is a long-term goal. You can set an intention but it's not--I think, with the way it differs is that we try to embrace reality and reality is that things change, they evolve and they grow. What you see now, a year from now, the landscape is going to look completely different so trying to actually put a lot of focus and emphasis on a year out or a three or five is going to actually hold you back and actually not allow you to adjust and be as mobile as, I think, businesses need to be.

Monique DeBose: So we're going to have to ask.

Eric Graham: Yes.

Monique DeBose: So there's an ideal that people are reaching for or we totally wipe that out completely and just go with the day to day?

Eric Graham: Not necessarily, no. They're still holding an intention, I think, there can still be vision. It's just the amount of emphasis and focus that’s put on a long-term objective. So in holacracy, we can set a long-term intention but let's actually stay more present and more real with what happens on a more incremental basis.

Monique DeBose: OK. So steering…

Eric Graham: So that’s dynamic steering, the other aspect is integrating perspectives. So basically, the stance of holacracy is that the ideas that we want to try to gain as much information as possible about any decision that’s being made and the best way to do that is to integrate different perspectives. Everybody has some piece of the truth or some piece to offer any given dilemma or problem or situation that arises and, actually, setting up a process where you can integrate as many of those perspective as possible, we found to be really helpful.

A lot of those is tied to different personality types. Some people can make really quick decisions, other people like to sit back and process information and then share something later on. Some people may see just different aspects of information, the different ways of people cognize and understand things are different. So trying to integrate those perspectives is more valuable.

Monique DeBose: So I hear that decisions are made quickly with new information coming in all the time and the decisions are being adjusted and then I also hear that everybody’s opinion is important. So if I'm the owner of this company or in charge of some big organization, how am I going to buy into the lady who sweeps the floor in my building who works for my company? Why would I want to do that?

Eric Graham: Everybody is responsible for their scope of responsibility. So it's not that the woman, somebody at the very bottom of the chain is going to have as much influence as somebody at the top. They have their role and their accountabilities that they're responsible to and they’ll sit on a circle, which is responsible for that scope of work. Within that circle, they’ll be able to influence the policies and the procedures and they’ll have a part of that circle and a part of the governance of that circle. But the way that the person at the top receives the information is that there's information flow that comes from that bottom circle up to each super circle all the way up to the top. So the person at the top, he gets to receive that data and information and then integrate that as they see fit.

Monique DeBose: I keep going back to this piece because I really want to understand this. So again, why would I be interested in what she has to say if her job is taking care of the building, let's say? How is that going to affect my decision making skills for selling product or for organizing an event outside of the place?

Eric Graham: Well, I think, a lot of it is that that person is going to be--I mean, you may not, like the example you are using may not quite work. I think, it's more like…

Monique DeBose: How about you give me an example.

Eric Graham: Yes, let's use an example that we're applying it right now in a software development company. The way that that works is you have your executive level team and then you have your product team and then you actually have the project manager and the developers. So the CEO at the top is trying to make decisions on the direction of the company, what kind of products to be developing.

A lot of times, they don’t have much interface or feedback from the developers on more of the street level, at the very ground level of the company. This way, those people are actually very intimate with their products, they're very intimate with their customers, they're very intimate with what's going on in the marketplace. So by having this system where the holarchy, the different levels of circles, there's information flow that can come back up to the top.

Monique DeBose: Right, OK. What are its advantages over traditional forms of governance or organizations, let's just even say for instance, democracy? What are its advantages?

Eric Graham: I think this actually goes back to another core principle, which is that holacracy tries to embrace tension that comes up in the organization instead of trying to push it away. I think, oftentimes in a lot of businesses, there's a lot of tension that goes on throughout the organization. Oftentimes, there isn't a room to address it or there isn't a forum for people to actually communicate those tensions up the organization. So what holacracy tries to do is actually embrace those tensions and give people a forum to be able to voice that information because there's learning that can be taken from that, there's actual information that’s there.

Monique DeBose: So how does this look because I'm thinking also, it seems like it's going to be taking a lot more time away from productivity, for instance.

Eric Graham: No, not really at all, I don’t think. I think, in any organization, there's governance that goes on. Anytime we get together as a group of people trying to accomplish a goal, there's going to be structure, it's just inherent in people getting together. Oftentimes in businesses, that’s not really explicit and it's not really chosen with any sort of conscious decision-making; instead, it just arises or you just take what's standard.

But a governance is going on all the time, it's happening. So by actually taking holacracy and separating in two, and say, “OK, there's the governance aspect, which is how we structure and make decisions and distribute power. Then there's the operations, which is a whole other side of holacracy, which is actually getting the work done.” So holacracy is not just the governance, it's both and yet there are meetings for governance that take place.

But what we found is that when the governance aspect is clear, when it's explicit, when the rules are defined, when the decision making is defined and it's all there, then it can actually move very quickly and happens quickly.

Monique DeBose: So would somebody literally say, “OK, tonight at 6 o’clock, we're having a meeting to air grievances, to embrace this tension?”

Eric Graham: Right. Well, there's regular meetings so you have--in the governance aspect, there's a governance meeting and that would be a regular weekly, biweekly, monthly.

Monique DeBose: And everybody is involved.

Eric Graham: And everybody within the circle…

Monique DeBose: Oh, the circle.

Eric Graham: …each circle has their own governance meeting because each circle is somewhat autonomous. They have their own governance, their own policies, their own rules and accountabilities and they hold regular meetings to revisit that governance. That’s where a place where tensions get introduced and brought in to that circle.

Monique DeBose: Within that circle.

Eric Graham: Within that circle. So over the course of a couple of weeks between the meetings, things come up and you experience the tension or new information comes up and it's like, “OK, there's something that is not right here. We need a new role. I'm trying to do too much and I need to split this role in two.” It's this tension comes up. Then in that circle meeting, it's like you have a chance to make a proposal and that’s how a lot of these decisions are run, are proposal-based. Then you propose to the circle, “OK, here's the tension that I'm having and here's what I think will address that tension.”

So there's a short format or if you already know and you actually have a proposal, you can present it to the group. If you don’t have a solution, you just have tension, there's a long format. Then you introduce the tension and then you’ve integrate perspectives from the whole group to try to come to a final [xx].

Monique DeBose: So there has to be a buy-in from every individual in this holacracy, that they're going to be willing to speak their tension.

Eric Graham: Yes, that’s what's encouraged. I mean, not everybody would do that but it's encouraged as part of the culture of holacracy that tensions are actually a good thing and that’s information and to bring that into the circle.

Monique DeBose: Are there people who are saboteurs for this kind of governance, people who won't participate?

Eric Graham: It's possible, we haven’t really run into it as an itinerary in the Integral Institute where we used it. It seems like the culture is such that it allows everybody’s voice to be heard. So as long as you feel like you can speak your mind and speak your truth and speak your tensions, then there's not really much of a reason to try and sabotage the system. So we haven’t run into it.

A lot of times, in the meetings, there's also a facilitator and that’s a very important role. Somebody who's actually managing the process, making sure that things are going smoothly. They kind of discern whether somebody’s taking a personal interest and coming from their ego self or if they're looking out for the system. The goal in these meetings is not your own personal preferences but it's you take a role and your role has accountabilities and you try to take the perspective of that role and bring tensions from the system into the [xx].

Monique DeBose: So if I don’t agree with something happening but if for the system it works, I'm supposed to put down my ego and that piece of me and that works successfully for people.

Eric Graham: Yes, it's worth it, it's worth it. It's a challenge.

Monique DeBose: I'm really pushing this point.

Eric Graham: No, I know, I know. This is where it gets tough.

Monique DeBose: So what happens to the individual?

Eric Graham: The individual is still embraced. They are the ones feeling the tensions, they're the ones experiencing these things. But it's a mindset, I think, it's a mentality that the system is what we're trying to work for here, it's the organization and not our personal preferences. A lot of it is--it takes sometime, this isn't something that people get right away so there is a little bit of a learning curve. But as you start to experience it and embrace it, you realize that how much faster and more effective decisions can take place.

Monique DeBose: So how do you integrate this as a consultant for doing this kind of work? Let's say a community here like One Taste where you’ve 45 people who live and work together on a daily, how would you integrate a system like holacracy into a place or community like this?

Eric Graham: Yes. Well, I think, the best way to do it is start from the ground up and that’s looking at what do we try to accomplish, what do we try to achieve? In order to achieve those goals, there are certain accountabilities and roles that are going to be needed in order to do that. So it starts to become pretty obvious, it's like, “OK, we have a product we want to sell. Let's take an example. OK, what do we need? We need to have our strategy in place. We need to actually have thinking through how to create the product, thinking how to market it, how to sell it.” These different roles start to become clear are actually accountabilities and then those get grouped in to roles and then as the roles relate to one another, you create a circle and that would be the very kind of ground floor of that organization.

Monique DeBose: So if we had a circle--and you just recently said something about a facilitator would kind of guide the meeting for tension, that kind of thing. How do we decide who the facilitator is?

Eric Graham: You do an election, and there's actually a process in holacracy called “integrative elections” where within that, once a circle is formed, there's a few key roles. One is a facilitator of the circle, one is the secretary who keeps the notes and logs and decisions of the circle, and the other is the representative link who is the person who's going to sit on the circle above you, the super circle.

So as the holarchy flushes out and as you get more levels of circles as that becomes more clear, then this is a whole piece we haven’t really talked about yet. It's the double linking between each circle. So you actually elect a representative link to sit on the circle above and represent the tensions of that circle and make sure that there is an environment that that circle needs in order to get done what their aim is.

Monique DeBose: OK. I'm going to take a break right now. This is “A Taste of Sex: Guest Lecturer Series.” We'll take a quick break and we'll hear more from Eric Graham in a minute.

[radio break]

Monique DeBose: So welcome back to “A Taste of Sex: Guest Speakers Series.” We're here tonight with Eric Graham. He's speaking with us about holacracy. As we mentioned in the beginning, Eric is a consultant for HolocracyOne. He's also a Web management project manager. I wanted to ask you a little bit more about some of--I'd like to hear about an example of maybe a before and after of holacracy being integrated into some kind of system or organization. So you mentioned the Integral Institute, can you give us a little bit about that?

Eric Graham: Yes, yes. I worked with Integral Institute for a year and a half and the first year that I was there, it was very loosely organized. We're similar to One Taste in that we're a group of people with very aligned ideals and a purpose and a way of life. But as far as running a business, we're a little bit lost and there was no real direction. So we ran into Brian Robertson who founded holacracy about a year after I'd started and decided to implement it there and it was pretty dramatic.

The results that we experienced, it was a complete shift from walking into a meeting, not really having clear roles and accountabilities, not really having an agenda, people talking over each other. We were trying to do the best we could but there just wasn’t a lot of experience in business. So when we actually implement holacracy, it gave us, first of all, a structure, a way to group us into departments and actually put roles and responsibilities together and figure how to make the clusters work. Then once we got in and had our meetings--either our governance meetings or operations meetings--we had a clear agenda, we knew what we needed to discuss, we had a place to raise the tensions.

That was a huge, huge part of the transformation with the new organization as that there was all these tensions that was going on and it would boil to the surface every now and again. It would explode, somebody would yell and scream and be angry and then it would kind of, “OK, what do we do with that?” We don’t really know and everybody is feeling that same frustration but there was nowhere to go with it. So this gave us a forum that embraces tensions and turn them into proposals so that there was actually forum moving action that can be taken.

Monique DeBose: That’s what I was going to ask you. I heard you say a couple of times “embracing the tension.” What do you do with it? So I come to you and say I'm pissed off because I feel like I'm working way too much. How do we embrace that tension to make it something productive?

Eric Graham: Yes. So that would happen within a governance meeting, you would bring up that tension and go into it. Either, like I said, there's a short format. If you have a proposal, it's like you experience the tension and you know it's clear to you what needs to happen. “We need to hire somebody else in order to take on this work.” Then, if that’s your proposal, that’s what you put out to the group. You go through several rounds of going through it. There's a clarifying round where you ask questions of each individual about what the proposal means, you kind of go into the granular details of it. Then, you actually go through in doing that objections round. So you're around and see if anybody objects to that proposal and if there are no objections, then it passes.

Monique DeBose: And if there is?

Eric Graham: And if there is an objection, that’s where the integrating perspectives come into play. So that’s where somebody has an objection because it's going to affect the system somehow. Again, not their preference but they're looking out--maybe it's the role of the financier, financial person in the circle and they're saying, “We can't afford it.” So [xx] objection, “We can't afford it.” OK, so we bring that objection into the proposal.

It's not, “OK, no, it doesn’t happen”, it doesn’t deny or shut down the proposal. This is where we're trying to integrate that. OK, why can't we afford it? What are some of the options around being able to afford it?” and kind of going into different ways and that’s where then you get everybody talking and brainstorming and sharing ideas. Then if you can resolve it, then again, you're around to do an objection round and if you’ve been able to resolve the issue, then it passes.

Monique DeBose: So are people more intimate in these kinds of systems in the sense of really feeling they have connection?

Eric Graham: Absolutely. One of the deepest parts is using internal language and it's kind of the left quadrant more interpersonal effects that holacracy has. I mean, it's as simple as--like when we do our agenda, the first step in the agenda is a check-in round and that’s where you actually go around and ask everybody how they're doing. It's not “Well, how business is going?”, it's “What's going on in your life that you're bringing into this circle right now?” “I'm going through a divorce and I haven’t a [xx] of time. Things are --I'm really struggling.”

Monique DeBose: How do you, guys, make a safe space to make it possible for me, average Joanna, in coming to work and I've got kids at home and maybe I just come to work and, you know.

Eric Graham: Yes. Well, I guess, there's a couple of ways to answer that is you're welcome to do that, you're welcome to offer as much as you're willing to. But also, I think, holacracy draws a certain type of person that is actually more interested in transparency and being a little more open. My experience is that most of us do want to have some sense of truth, want to have a little more transparency, at least, than we're experiencing now in the corporate world.

At least, some sense of sharing and who we’re in the space--not your history, necessarily, but what's going on right here, right now.  What's affecting you? A lot of times, those don’t get voiced and so you second-guess why somebody is angry or why somebody is bitter or why they snap at you. But if you realize that their kid has been in the hospital for the last three days, that changes your perspective.

Monique DeBose: Sure, I get that. Have you found it, in anyway? Are there any drawbacks to holacracy that you’ve found in your experience with it or areas for improvement?

Eric Graham: Yes, yes. I think, because it's new, it's not some rolled out system that you know exactly what's going to happen. It's still evolving and it's changing and, I think, Brian at Ternary, they're getting a lot of feedback and they're making changes. But, it's new.

Monique DeBose: Actually, I want to stop before one second.

Eric Graham: Sure.

Monique DeBose: We'll just raise the tension a little here. I want to go back to the history because you're mentioning Brian and Ternary, so if you can give us a little bit of the history, how old or how new is this concept?

Eric Graham: It was started by Brian Robertson, who is the founder of Ternary Software in Pennsylvania. They started that company, I think, about six years ago and it started with three founders. They, basically, started the organization not just to build software but to build a form of governance, that was part of their intention. So they were asking themselves the questions of “What's systems have worked, what doesn’t work? How can we leverage different forms of governance that are out there?” They came across Sociocracy, which is the foundation of holacracy, and they now, over the last six years, they’ve been using sociocracy and then they’ve scaled it and it's evolved into what we holacracy.

Monique DeBose: Can you give me sociocracy in a sentence or two?

Eric Graham: I guess, the foundations are the same in that there's embracing tensions, that there is the double linking structure so there is information flow, obviously, going down the organization as is typical. But there's also the information going back up through the double linking structure. There are probably other similarities that I'm not thinking of right now. [laughs] I'm not as familiar with it as holacracy.

Monique DeBose: OK, that’s good enough. So back to the drawbacks, some pieces you’ve seen just with your practice with this.

Eric Graham: It does take some time, I think there's a learning curve to it. So you can implement some practices that are very simple and, in your first meeting, you can see changes so there are actually changes that take effect right away. But, there are many nuances and layers to it so it takes some time to actually get into the real depth of it. I think it's such a whole system shift that there's a lot of culture that needs to change as well as just the systems and the processes and that takes some time and different people, different responses to it.

Monique DeBose: So with the Integral Institute, how long did that take? If you can just give me a little bit about that shift from before to after.

Eric Graham: Well, we got a few people that flew out and trained with Brian for a couple days and then came back and we formally implemented it within our Institute. I would say, within the first three to four weeks, we were experiencing tremendous changes and a lot more clarity in the organization.

Monique DeBose: Were there big manuals for people to read? Is it that kind of thing?

Eric Graham: No, it's so new and it's not really developed that way. It's not completely flushed out where there's “Here's your manual and here's step one through ten” in order to implement it. It's still a lot of it is within Ternary as an organization and within Brian’s head. We're just starting to kind of take this out to other companies as interest is growing and people are seeing the success that Ternary has had of it.

Monique DeBose: So I'm going to bring you down to a more personal level. I'm engaged to be married and my fiancé is somebody who’s super organized almost to the point where it drives me crazy. But we're trying to figure out systems and really setting an intention for what it means for us to be together. So does holacracy work for a duo?

Eric Graham: Yes. I think, it could, I don’t see why not. I know that somebody, one of the developers at Ternary has actually applied this in their family. So any system, any structure, and two people is a structure, it's a system, so I think using that same way of presenting proposals and integrating perspectives can be used on any scale from two to 200,00.

Monique DeBose: Great. Is this more for organizations, businesses? What's the future of holacracy? Are you seeing it like take over the world like one group consensus at a time? Is this a possible governance for a nation? What's your vision for it?

Eric Graham: Who’s to say? But from what we've seen and what our own feelings about it is that it's profound. It actually could have significant impact on organizations. As people start to adopt it and if it works and if we can find that it is transferable to other organizations, then I don’t see why it couldn’t, at least, go through an industry to start.

Another cool thing about it is that you can start to link organizations to organizations, so even though there's the circles, the holarchy within an organization, that top circle links to another organization and the next can be even bigger structures linking to others. So you could have an entire industry, if they're all using holacracy, it can be this incredible information flow all the way through. A government, I don’t why it couldn’t work there as well.

Monique DeBose: What's going to make me buy in? Seriously, why would I buy in?

Eric Graham: I don’t think there's any buying in. I think if people are attracted to it, there's something about it that people resonate with that we've found. I resonated with it, it sounds good. I've used it and you have to use it, you have to try it. For me, it worked in the organization that I was in, for others, it's starting to work. So if you try it and it works, go for it. [laughs]

Monique DeBose: [laughs] One other piece, I'm really pushing this one here to you. I do believe that everybody wants to have a voice and wants to be heard and really be seen. I think that really would make things more seamless. That being said, we also live in a world currently where people don’t feel comfortable doing that, people feel shutdown around that. So if we can go back to that example of the Integral Institute, were there people who had real resistance and what happened in those instances? How do you integrate it into an individual’s inner system that may not be interested or maybe resistant?

Eric Graham: Yes. It's not all that demanding. On the lowest scale, there's not a whole lot that a person has to actually do to be a part of holacracy. You don’t have to contribute a great deal, you have your role and you have your accountabilities. If you're doing those, your doing your job and you can stay within the organization. The depth to which you go is up to you.

Monique DeBose: But it can still function if I decide to put in this much…

Eric Graham: You can still function, absolutely.

Monique DeBose: …and you decide to put in your holacracy.

Eric Graham: Yes, it's not going to function as well and as deeply so as maybe the executive level or the higher ups. If you really want a fully functioning holarchy using holacracy, then you might start to select the people that are more drawn to it and more willing to be part of it.

Monique DeBose: OK. Thank you. Well, thanks for joining us for “A Taste of Sex: Guest Speakers Series” here hosted at One Taste Urban Retreat Center in San Francisco. I want to thank Eric for being here, we really appreciate it.

You can find us on the Web at PersonalLifeMedia.com, all one word, or you can check us out OneTaste.us. For more information about our lectures and our workshops in sensuality communication, and relationship. I'm Monique DeBose, and we'll see you next time.

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