There are three main organizational structures that I'm going to cover in this post:
- Holacracy
- Sociocracy 3.0
- Spotify model
Holacracy
Holacracy is an organizational model that focuses on self-management and distributed authority. Holacracy is a system that allows people to organize themselves, their roles, and their responsibilities into ever-shifting structures. It does this by replacing traditional management with a "tactical" approach to organization.
In holacracy, there are no managers or bosses; instead, there are clear roles that can be filled by anyone who has the skills and interest to do so. The role of each employee is defined by the contribution they make to the business, rather than by their title or position, or level in the hierarchy. There are no job descriptions; instead, every person has a purpose written down in terms of their contribution to the broader organization's mission.
Holacracy uses clear governance processes that ensure that everyone's voice is heard and that decisions are made in alignment with the company's purpose (or "purpose statement"). These governance processes include quarterly elections for roles like CEO, COO, and CMO — positions that change hands every quarter so there's always someone new responsible for strategy and growth initiatives.
Sociocracy 3.0
Sociocracy 3.0 is a governance system that includes the elements of consensus decision-making, transparency, and delegation. It uses a voting system where people rank the importance of issues and then vote on them. The voting system can also be used to elect board members and executives.
Sociocracy 3.0 is based on a model of organizations developed by sociologists in the 1970s. It was designed for use in organizations that want to operate as democratically as possible but still need to make decisions quickly.
The basic principle behind Sociocracy 3.0 is that decisions should be made by those who are most affected by them — meaning that all employees should have equal input into decisions about their work environment and the direction of their organization's projects.
Spotify model
The structure of Spotify’s organization is unique to the company and is based on the need for speed. The way it was designed is meant to ensure that the company can innovate quickly, without slowing down. It’s also designed so that employees can spend more time doing what they love, which makes them happier and more productive.
The main parts of Spotify’s organization are:
- Spotify squads — similar to a scrum team, squads are cross-functional, autonomous teams (typically 6-12 individuals) that focus on one feature area.
- Spotify tribes — multiple squads coordinated on a same feature area (typically 40-150 people).
- Spotify chapters — specialists that align a tribe around best practices.
- Spotify guilds — a community of interest around a common topic, they can cross different tribes.
Spotify's model of organization is based on three main principles:
- A flat hierarchy with no middle management
- A collaborative culture where ideas are shared openly and often
- A focus on meritocracy
Description of the model by Henrik Kniberg & Anders Ivarsson