If Holacracy (or similar “teal” organization structures) is so superior to the current “orange” organization paradigm, why isn’t it more widespread?

It’s important to note that no color stage listed in Reinventing Organizations (the book often credited with publishing the “evolutionary” color scale) is considered to be “superior” to the others. Each has different strengths and weaknesses. This is largely why the adoption isn’t more widespread–to say that a Teal company can work is not to say that an Orange company doesn’t. Orange works. Green works. Red works. It just depends what you’re looking for from these companies.

Now, as a person who came from a company attempting to transition from Orange-Green (yes, you can be multiple colors at once–in fact, most companies are) to Teal, here are some of the big barriers that I’ve seen:

  1. There’s no real blueprint. Companies have largely been run the same way for hundreds of years. Because of this, there are tons of great examples that can be followed, making starting a business in the older ways very efficient. It’s much easier to follow a path than cut a new one.
  2. It challenges societal norms, and thus, our own perceptions of self. In order to move to a Teal structure, the leadership in a company must be committed to distribution of power. We have grown up in a country/world that tells us that you can usually track someone’s success through their title and rank. So when it comes time for leaders in these organizations to relinquish their authority, it feels like a real step back. Think about it–you’ve worked really hard to get established in a company so that you can make a bigger impact. You’ve finally been promoted enough through the years to ensure that your voice will always be heard. Now, you’re faced with a choice: Continue in the current system that has served you well and that you’ve worked hard to master, or move to a new system that now makes you an equal (in theory) to someone who just joined the company 6 months ago. You are pretty sure people would still listen to you, but they also might not. They no longer have to respect your rank. In fact, your VP title might not even exist anymore. How would that look to your professional network? Your family? Your friends? That’s a complex emotional prospect for anyone.
  3. It requires a high level of self-awareness and emotional maturity. To have an organization that is truly self-organized or “flat,” each employee must know his/herself inside and out. Each must be aware and realistic about their strengths, shortcomings, sensitivities, biases, etc. After all, progression is now self-led, and feedback is all peer-based. This is where emotional maturity enters. Employees must give feedback openly and take it seriously. Petty arguments, politics, and biases are major blockers in the workplace when it comes to feedback loops. “Smart” doesn’t equal “emotionally intelligent.” You can throw a ton of really smart people into a room to discuss a controversial topic and see this one play out. The truth is, there just aren’t enough companies out there (perhaps any) that have a deep enough roster of individuals capable of this to make it work.
  4. Leadership changes their minds. Let’s face it, many of the companies out there that are willing to experiment with Teal practices are likely run by a leader/leadership group that already does a lot of experimentation (i.e.- reads a book about management–implements change. Sees a speaker on TED–incorporates speech principles to company principles…and so-on.). When you fully commit to a change like this, it’s effectively the last time you can do something like that (you can no longer command/dictate a company change like before). Alternatively, this type of move means more voices are important now; so what happens if the majority of employees want to do something that the CEO or former Leadership Group has always been opposed to? In situations like this, these leaders realize what they’ve done with their power and often will try to regain control somehow, severely damaging the credibility behind the transition to Teal practices in the first place.

In no way is this the complete list of reasons that you don’t see more Teal companies (I didn’t even include probably the biggest one of all–the fact that many people don’t even know it’s an option), but hopefully this gives a little perspective to real barriers, making the transition such a hard thing to do. These are a few of the big reasons that people opt to stick with the norm at their companies.


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