« This is the true heart of Holacracy: it is not the solution that gets the most approval that is applied, but the one that does not cause harm. »
Interview with Gerhard Andrey* Co-founder of the company Liip
*Gerhard Andrey is co-founder of the company Liip. Founded in 2007, Liip offers all the services of digital progress: innovative user experience, seamless development, search engine optimization, sophisticated analytics and new efficient ways of working.
Since 2016 the 180 employees of your digital agency work without hierarchy and without a Board of Directors. Local proximity is very important to Liip, which has offices in Zurich, Lausanne, Bern, Fribourg and St. Gallen.
What does self-organization actually mean ?
For Liip, self-organization means on one hand that we can manage day-to-day business efficiently and with little bureaucracy and on the other hand that we can react incredibly quickly to changes in our market environment. With Holacracy, we have also removed the top management and we now have a very agile organization in which authority is distributed. The employees can thus contribute according to their skills and needs in the interest of the company.
Why did you change Liip’s organization after 10 years ?
The introduction of Holacracy in 2016 was just one step on a path that had begun much earlier. The strong growth that followed the creation of the company, asked us to take up a challenge: to maintain our agility while bringing clarity to the organization. A traditional hierarchical management system was not an option for us. Because it is not suited to a constantly changing market environment.
After already several years of practice with self-organization principles, Holacracy in 2016 has not been culturally disruptive for the company. Of course, the introduction of the system required a lot of energy. However, about a year and a half later, the main obstacles had been overcome.
Was there an internal vote on this change?
Prior to the introduction, we conducted numerous interviews and surveys. This created a good basis for assessing the acceptance of an even more consistent self-organization. However, the decision to introduce Holacracy was officially taken by the board of directors, which under company law has the non-delegable task of determining the organizational form of a public limited company..
How many managers and employees did you lose by implementing the Holacracy system?
The fluctuation has not changed significantly. What has changed is the attractiveness of the job market. We heard that Liip was working differently from the others and in a very interesting way for the employees. We still benefit a lot from that, even today.
How long did the change in organizational form take ?
It is difficult to determine an exact time frame. But I would still say that after a year and a half, we took a step forward: the system had become fully operational and the (understandable) criticism stopped. Today, Holacracy is undisputed at Liip.
How has your own role changed ?
My roles were clarified in the introduction. Holacracy is very explicit about roles and expectations. Before Holacracy, it was often not clear why I was taking on a topic. As a member of the management team, a lot of things just accumulated with us. Not because we were the most appropriate people, but because management was generally expected to solve all kinds of problems. Today, with Holacracy, there is a much greater likelihood that the most appropriate person will make the final decision. For me, this means that I am no longer a firefighter, but that I can do what I am good at and what I like to do. And I would say that’s true for most Liipers.
Who defines the objectives today ?
Each circle determines its own strategies and objectives. This is in accordance with the purpose (or raison d’être) of the circle in question and the purpose of the upper circle.
Who is responsible for finance – is there a CFO?
Finance is a subject like any other, organized according to the rules of Holacracy. There is a “finance circle”, which keeps the accounts, manages liquidity and makes investment recommendations. But there is no financial director.
How are wages determined at Liip ?
This too is organized in a circle. This circle develops our fully transparent remuneration system. The roles in another circle apply the rules of this system and, after integration of peer feedback, give the final grades to the Liipers. The definition of salaries is therefore a participatory and at the same time autocratic process.
Who is responsible if something goes wrong?
Especially when things are not going well, Holacracy is a very powerful model, because responsibility is decentralized and (this may seem surprising) absolute. In their respective roles, all Liipers like myself can make the necessary decisions. This means that you don’t have to wait for a central body to solve problems. And if someone in their role wants to change the company’s rules in the long run, it is up to the others in the circle to prove that the proposal is causing damage. This is the true heart of Holacracy: it is not the solution that gets the most approval that is applied, but the one that does not cause harm. This shortens meetings considerably. With Liip, it is now difficult to stop the change. And that’s a good thing!