Misperceptions of Self-Management

By Frederic Laloux

Say “Self-Management” and almost everyone gets the wrong idea.

Self-managing structures are appearing everywhere, and get increasing attention in the media. They seem to be much more adaptative, agile, motivating than traditional pyramidal organizations, and they appear to achieve spectacular results. But is this a simple fad, or a new phenomenon destined to spread? And why are most people dismissive when you mention the possibility to run organizations “without a boss”?

Even though we are only now starting to get our heads around it, Self-Management is not a startling new invention by any means. It is the way life has operated in the world for billions of years, bringing forth creatures and ecosystems so magnificent and complex we can hardly comprehend them. Self-organization is the life force of the world, thriving on the edge of chaos with just enough order to funnel its energy, but not so much as to slow down adaptation and learning.

Leading scientists believe that the principal science of the next century will be the study of complex, autocatalytic, self-organizing, non-linear, and adaptive systems. This is usually referred to as “complexity” or “chaos theory”. For a long time, we thought the world operated based on Newtonian principles. We didn’t know better and thought we needed to interfere with the life’s self-organizing urge and try to control one another.

It seems we are ready now to move beyond rigid structures and let organizations truly come to life. And yet self-management is still such a new concept that many people frequently misunderstand what it is about and what it takes to make it work.

Misperception 1: There is no structure, no management, no leadership

People who are new to the idea of Self-Management sometimes mistakenly assume that it simply means taking the hierarchy out of an organization and running everything democratically based on consensus. There is, of course, much more to it. Self-Management, just like the traditional pyramidal model it replaces, works with an interlocking set of structures, processes, and practices; these inform how teams are set up, how decisions get made, how roles are defined and distributed, how salaries are set, how people are recruited or dismissed, and so on.

What often puzzles us at first about self-managing organizations is that they are not structured along the control-minded hierarchical templates of Newtonian science. They are complex, participatory, interconnected, interdependent, and continually evolving systems, like ecosystems in nature. Form follows need. Roles are picked up, discarded, and exchanged fluidly. Power is distributed. Decisions are made at the point of origin. Innovations can spring up from all quarters. Meetings are held when they are needed. Temporary task forces are created spontaneously and quickly disbanded again. Here is how Chris Rufer, the founder and president of Morning Star, talks about the structure of self-managing organizations:

Clouds form and then go away because atmospheric conditions, temperatures, and humidity cause molecules of water to either condense or vaporize. Organizations should be the same; structures need to appear and disappear based on the forces that are acting in the organization. When people are free to act, they’re able to sense those forces and act in ways that fit best with reality.1

The tasks of management―setting direction and objectives, planning, directing, controlling, and evaluating―haven’t disappeared. They are simply no longer concentrated in dedicated management roles. Because they are spread widely, not narrowly, it can be argued that there is more management and leadership happening at any time in self-managing organizations despite, or rather precisely because of, the absence of fulltime managers.

Misperception 2: Everyone is equal

For as long as human memory goes back, the problem of power inequality has plagued life in organizations. Much of the pervasive fear that runs silently through organizations―and much of the politics, the silos, the greed, blaming, and resentment that feed on fear―stem from the unequal distribution of power.

Interestingly, the interlocking structures and processes allowing for self-organization do not resolve the question of power inequality; they transcend it. Attempting to resolve the problem of power inequality would call for everyone to be given the same power. Cooperatives, for instance, have sought in equal ownership a method to divide power equally. Interestingly, none of the organizations I have researched for the book Reinventing Organizations are employee-owned; the question of employee ownership doesn’t seem to matter very much when power is truly distributed.

The right question is not: how can everyone have equal power? It is rather: how can everyone be powerful? Power is not viewed as a zero-sum game, where the power I have is necessarily power taken away from you. Instead, if we acknowledge that we are all interconnected, the more powerful you are, the more powerful I can become. The more powerfully you advance the organization’s purpose, the more opportunities will open up for me to make contributions of my own.

Here we stumble upon a beautiful paradox: people can hold different levels of power, and yet everyone can be powerful. If I’m a machine operator―if my background, education, interests, and talents predispose me for such work―my scope of concern will be more limited than yours, if your roles involve coordinating the design of a whole new factory. And yet, if within what matters to me, I can take all necessary actions using the advice process, I have all the power I need.

This paradox cannot be understood with the unspoken metaphor we hold today of organizations as machines. In a machine, a small turn of the big cog at the top can send lots of little cogs spinning. The reverse isn’t true―the little cog at the bottom can try as hard as it pleases, but it has little power to move the bigger cog. The metaphor of nature as a complex, self-organizing system can much better accommodate this paradox. In an ecosystem, interconnected organisms thrive without one holding power over another. A fern or a mushroom can express its full selfhood without ever reaching out as far into the sky as the tree next to which it grows. Through a complex collaboration involving exchanges of nutrients, moisture, and shade, the mushroom, fern, and tree don’t compete but cooperate to grow into the biggest and healthiest version of themselves.

It’s the same in self-managing organizations: the point is not to make everyone equal; it is to allow all employees to grow into the strongest, healthiest version of themselves. Gone is the dominator hierarchy (the structure where bosses hold power over their subordinates). And precisely for that reason, lots of natural, evolving, overlapping hierarchies can emerge―hierarchies of development, skill, talent, expertise, and recognition, for example. This is a point that management author Gary Hamel noted about Morning Star:

Morning Star is a collection of naturally dynamic hierarchies. There isn’t one formal hierarchy; there are many informal ones. On any issue some colleagues will have a bigger say than others will, depending on their expertise and willingness to help. These are hierarchies of influence, not position, and they’re built from the bottom up. At Morning Star one accumulates authority by demonstrating expertise, helping peers, and adding value. Stop doing those things, and your influence wanes—as will your pay.2

So really, these organizations are anything but “flat,” a word often used for organizations with little or no hierarchy. On the contrary, they are alive and moving in all directions, allowing anyone to reach out for opportunities. How high you reach depends on your talents, your interests, your character, and the support you inspire from colleagues; it is no longer artificially constrained by the organization chart.

Misperception 3: It’s about empowerment

Many organizations today claim to be empowering. But note the painful irony in that statement. If employees need to be empowered, it is because the system’s very design concentrates power at the top and makes people at the lower rungs essentially powerless, unless leaders are generous enough to share some of their power. In self-managing organizations, people are not empowered by the good graces of other people. Empowerment is baked into the very fabric of the organization, into its structure, processes, and practices. Individuals need not fight for power. They simply have it. For people experiencing Self-Management for the first time, the ride can be bittersweet at first. With freedom comes responsibility: you can no longer throw problems, harsh decisions, or difficult calls up the hierarchy and let your bosses take care of it. You can’t take refuge in blame, apathy, or resentfulness. Everybody needs to grow up and take full responsibility for their thoughts and actions―a steep learning curve for some people. Former leaders and managers sometimes find it is a huge relief not having to deal with everybody else’s problems. But many also feel the phantom pain of not being able to wield their former positional power.

Many leading thinkers and practitioners in the field of organizational design focus their energy today on the question of how leaders can become more conscious. The thinking goes as follows: if only leaders could be more caring, more humble, more empowering, better listeners, more aware of the shadow they cast, they would wield their power more carefully and would create healthier and more productive organizations. Brian Robertson, the founder of Holacracy, put it well in a blog post:

We see attempts for leaders to develop to be more conscious, aware, awake, servant leaders that are empowering. … And yet, the irony: … If you need someone else to carefully wield their power and hold their space for you, then you are a victim. This is the irony of empowerment, and yet there is very little else we can do within our conventional operating system other than try our best to be conscious, empowering leaders.3

If we can’t think outside the pyramid, then indeed, as Robertson notes, the best we can do is try to patch up the unhealthy consequences of power inequality with more enlightened leadership. Pioneer self-managing organizations show that it’s possible to transcend the problem of power inequality and not just patch it up. We can reinvent the basic structures and practices of organizations to make everyone powerful and no one powerless.

Misperception 4: It’s still experimental

Another common misconception is that Self-Management might still be an experimental form of management. That is no longer true: Self-Management has proven its worth time and again, on both small and large scales and in various types of industry. W. L. Gore, a chemical manufacturing company best known for its Gore-Tex fabrics, has been operating on self-organizing principles since its founding in the late 1950s. Whole Foods, with its 60,000 employees and $9 billion in revenue, operates its more than 300 stores with self-governing units (the rest of the organization has more traditional hierarchical structures). Each store consists of roughly eight self-managing units, such as produce, seafood, and check-out (central services are run with a traditional, albeit empowered hierarchy).

The Orpheus Chamber Orchestra has operated since its founding in 1972 on entirely self-managing principles. The orchestra, with residence in New York’s Carnegie Hall, has earned rave reviews and is widely regarded as one of the world’s great orchestras. It operates without a conductor. Musicians from the orchestra make all artistic decisions, from choosing the repertoire to deciding how a piece ought to be played. They decide who to recruit, where to play, and with whom to collaborate.

Virtual and volunteer-driven organizations practice Self-Management on staggering scales. In 2012, Wikipedia had 100,000 active contributors. It is estimated that around the same number―100,000 people―have contributed to Linux. If these numbers sound large, they are dwarfed by other volunteer organizations. Alcoholics Anonymous currently has 1.8 million members participating in over 100,000 groups worldwide―each of them operating entirely on self-managing principles, structures, and practices.

I believe it is because we have grown up with traditional hierarchical organizations that we find it so hard to get our heads around Self-Management. Young people, on the other hand, who have grown up with the Web (variously referred to as Millennials, Generation Y) “get” self-management instinctively. On the web, management writer Gary Hamel notes:

  • No one can kill a good idea
  • Everyone can pitch in
  • Anyone can lead
  • No one can dictate
  • You get to choose your cause
  • You can easily build on top of what others have done
  • You don’t have to put up with bullies and tyrants
  • Agitators don’t get marginalized
  • Excellence usually wins (and mediocrity doesn’t)
  • Passion-killing policies get reversed
  • Great contributions get recognized and celebrated4

Many organizational leaders and human resource managers complain that Millennials are hard to manage. Indeed, this generation has grown up in the disruptive world of the Internet, where people’s influence is based on contribution and reputation, not position. Why would they want to put up with anything other than self-management in the workplace? Why would anyone else, for that matter?

1.    Hamel, “First, Let’s Fire All the Managers.”
2.    Ibid.
3.    Brian Robertson, “The Irony of Empowerment,” Holacracy Blogs, October 28, 2010, http://www.holacracy.org/blog, accessed November 2, 2011.
4.     Gary Hamel, What Matters Now (San Francisco: Jossey-Bass, 2012), 176-177.

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About the Author

Frederic Laloux

I work as an adviser, coach, and facilitator for corporate leaders who feel called to explore fundamentally new ways of organizing. I hold an MBA from INSEAD, and a degree in coaching from Newfield Network, and I formerly worked as an Associate Principal with McKinsey & Company. I've traveled widely and speak English, French, German, Dutch and…

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    Frederic this is very eye opening! As a PhD student studying leadership theories, it is interesting to more fully understand practical applications of self-management, especially to this extent. As a millennial, I would love to work in this type of environment! Misperception #3 was very enlightening because many think that if you work in an environment where you are empowered to make decisions you are winning. However, as you pointed out, empowerment simply means that someone else you giving you a slice of power from their share. Just as this power is given, it can be taken away! I’m very interested in seeing how organizations adopt this change and to what extent. Thanks!

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    Thanks a lot for this post!