Self-organization instead of hierarchy: May the decision-making power be with you!

It is paradoxical: Companies want to work in an agile manner and are doing away with hierarchies. Rules take their place. But in a complex world we cannot replace decisions with rules. Self-organization is the better solution.

When I talk about rules, I mean workflows or processes that replace existing hierarchies. An example: Who decides on further training or travel expenses? – Without a hierarchically regulated decision, such a case is either resolved by consensus decisions or defined rules. Neither is optimal. Rules cannot anticipate and anticipate every single step. You cannot clarify everything – above all, rules cannot replace independent acting and thinking. And now? But working hierarchically again? No. Rather, companies should get involved in learning and living self-organization.

Who doesn’t know it: “Can you please approve this?” Was a request that was often made in the past – one that was mainly heard from executives. But we leaders are not the Pope! Blessing or blessing should be left to those who know how to do it. Instead, employees should focus on actively and independently thinking and making decisions. It is important that everyone knows exactly within which framework they can move. Everyone needs to know the company’s strategic guard rails.

In his book “Reinventing Organizations”, the economic philosopher Frederic Laloux gives food for thought with the “Advice Process” on how self-organization can succeed. Basically, every employee can make all decisions – but only after he or she has asked everyone who will be affected by the decision, as well as other people who have specialist knowledge of the matter, for advice.

This procedure allows anyone: anyone to take the initiative and make decisions. Listening to advice is important, but ultimately you have to decide for yourself how useful it is. Self-organization also includes standing up for the consequences of your own decisions. In addition, everyone must: r accept the decisions of others in the team. This is part of working without hierarchies.

Self-organization also enables more efficient and faster action than would be the case, for example, with flat hierarchies. In case of doubt, more people would be involved in decisions who have nothing relevant to contribute. In the case of self-organization, on the other hand, only people who have a technical contribution to make are included in the decision.

At Smartsteuer we have few, but uniformly valid agreements, such as the processing of recurring internal formats. This ensures a good orientation. One example is the strategy group: Smartsteuer has a rotating team for the company’s strategic guard rails, within which all further decisions are made. This consists of representatives from the specialist departments who jointly determine the overall strategy and the “direction of travel” of the company. In order to prevent the formation of an ivory tower, the members of the strategy group change regularly.

We have also introduced the theses bazaar, where everyone: r Can propose innovation topics. This will be voted on – with hands and feet. Approval is given with a show of hands: if you raise your hand and show five fingers, you agree to the proposal with “Hell yeah”, if you show your fist and thus zero fingers, you say “veto”. However, a veto is not the same as a rejection. It just means there is a lack of support. Thus, a veto would at least be a weighty reason for the team to reconsider their own proposal. Incidentally, we have not yet had a veto. Incidentally, I would not rule out a majority decision in decisions and votes on general issues – but this has not yet happened.

There are theories which say: Even the salary does not always have to be a one-sided decision on the part of the executives. However, we have not yet found a suitable solution for ourselves. Immediately after our reorganization, a “talent team” was set up to find answers to certain questions that are traditionally solved by bosses. This includes, for example, feedback discussions with employees, hiring, layoffs and the salary. Because the talent team realized that other topics had to be prioritized – and the salary issue was not under the greatest pressure to innovate – the project was initially postponed. At the moment, however, there is again a team that is grappling with the question of how we might be able to decide on salary in a self-organized manner in the future.

The changeover from a hierarchical company to complete self-organization is not always easy. In my experience, the abolition of hierarchies creates a kind of power vacuum that is accompanied by uncertainty. At first it may also bring about chaos, as new ways of working have to settle in first. Such a situation of unpredictable development doesn’t always feel great. It is exactly what we actually want to avoid intuitively.

For a short time, employees no longer know what to use for orientation. But this is exactly the moment when organizational change and personal growth coincide. Then looking for something to hold on to in rules is an absolutely understandable step – after all, we have probably all learned no other way in our lives. But those who can resist this impulse begin to think for themselves – and take a huge step forward. Personally and maybe also as a company.

Björn Waide

Björn Waide is the managing director of Smartsteuer. The team digitizes the most analog process in Germany: the tax return. With contributions on topics such as self-efficacy or modern leadership, Waide shapes the discussion on management in the digital age.

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