Laird’s Critique of Sociocracy

Dear Laird,

I just read your blog post:

First, I want to say that I feel happy when I see your name on the page — it’s great to think of you again, and I deeply respect your expertise as a facilitator. I have enjoyed working with you in the FIC and elsewhere.

Second, I have some quibbles with what you claim. I’d like to improve your understanding of Sociocracy. I’ll respond to each of your numbered points in turn.

1. While the framework of Sociocracy does not refer to emotions specifically, I find that I can effectively use the framework to include emotional content. Emotional content is a valid input, along with any other information, during every phase of the policy development & decision-making process. Most of the trainers (and all of the certified trainers) I have worked with have a background training in emotional processing of some kind and bring that into the process. I see that as essential.

I agree with you that preventing conflict and upset is both impossible and undesirable; anyone claiming to do so is not likely to be effective as a facilitator or consultant (and certainly not as a leader). I doubt that the “advocate of Sociocracy” who made this claim to you has had much training or experience.

2. When I’m working with small businesses or volunteer groups, I emphasize the difference between operations and policy-making. In many consensus-governed groups, every committee meeting is governed by consensus. From what you say in your blog, it looks to me as though you imagine the “double link” representative showing up to every meeting! I generally suggest that small organizations have infrequent “circle meetings” of the coordinating team, perhaps one per quarter. Most operational decisions can be made by one or two volunteers or employees just doing what falls within their roles.

I’d be happy to talk through the details with you, but in summary I can assure you that it does not require as much time as it seems you expect it to.

3. In my experience of sociocratic elections, they are transformative and drive the development of group cohesion and people’s ability to deliver feedback effectively. Sociocratic elections develop the group’s ability to handle the non-trivial challenges you note:

o  Creating a culture in which critical feedback relative to group function is valued and encouraged.

o  Helping people find the courage to say hard things.

o  Helping people with critical things to say to sort out (and process separately) any upset or reactivity they are carrying in association with the critique, so that they don’t unload on the person when offering feedback.

o  Helping recipients respond to critical feedback openly, not defensively.

Of course none of those things is easy to do, and of course groups using Sociocracy don’t handle those challenges perfectly. I won’t try to convince you of the things you say I cannot convince you of — and you are just arguing with a silly straw man anyway. I do claim that handling the tough issues openly and with an appreciative frame (as in the sociocratic election) is a helpful approach to a difficult set of issues.

4. Different consensus-using groups have different bars they must pass in order to make a decision — from “everyone deeply agrees” to “everyone can live with it”. Sociocratic consent uses a very specific definition for the “paramount objection” — it must be a risk which would prevent a group from accomplishing its Aim, or the specific value which that group exists to deliver. It is true that this definition is similar to the definition of “Critical Concern” in Formal Consensus, but that definition is not universal to all consensus-using groups, and in my experience even highly-trained and experienced groups (including ones you and I have both been present in) fall into the “I don’t like it” trap. I am sorry you haven’t been able to find the explicit definition of “paramount objection” in your reading or training in Sociocracy. When I am writing organizational bylaws I usually describe it as “identifying a risk the organization cannot afford to take”.

Speaking of emotions, when you say that the distinction between consent and consensus is “just playing with words”, I imagine I see anger. Is that true?

5. You are right. Rounds are not always the best format. I recommend that sociocratic facilitators master rounds as their first process tool, and always use rounds when testing for consent.

6. It is not correct that Sociocracy decision-making processes must always start with proposals. I often recommend that people start with proposals, for the reasons you mention, but the standard policy-formation process starts with asking everyone to contribute information about an issue. This information often includes emotional content. It then procedes to a group proposal-forming process, and ends in a decision-making process relating to the proposal.

In summary, I have the sense that you’ve been getting your information on Sociocracy from uninformed sources, or a quick skim of some of the materials available online. If they’ve been my materials, then I apologize for my lack of clarity! Please do let me know if there is any way I can be more clear.

Nate Whitestone (formerly Nate White)

A Community Has The Right to Self-Determination

The Market Basket supermarket chain has refused the formal authority of its owners, and given its allegiance to the leader it trusts and prefers. When I say the “supermarket chain has refused”, I am referring not to the legal entity but to the community of workers that brought that legal identity to life. That community has done the right thing; what’s needed now is a governance structure that recognizes the community’s rights.

From on July 30th 2014, a summary by BoingBoing reader MiketheBard:
“[…] Market Basket, a New England supermarket chain that Consumer Reports named the 6th best in the country, has been all over the news in the Northeast for the last couple months.

After a long family feud, the majority stockholders fired their cousin, longtime CEO Arthur T DeMoulas. He had built the business on low prices, high wages, and ZERO company debt- All employees get profit sharing and a livable wage, and many have been with the company 20, 30, even 50 years.

Arthur T. was replaced with the former president of Radio Shack, with an evident goal of strip mining the wealth from the company–raising prices, cutting benefits, loading up with debt, and selling off real estate–in order to pay out higher stock dividends to the controlling shareholders.

The employees revolted. Top executives walked off the job and picketed in front of headquarters. Employees from managers to baggers are using their vacation time to protest outside stores. 68 out of 71 managers have pledged to quit unless Artie T is reinstated or allowed to purchase the remaining 51% of the family-owned company. Deliveries have stopped and twitter is full of photos of completely bare shelves. […]”

These employees are doing the right thing, and the majority stockholders are in the wrong. While I do not believe that the legal entity of a company is a person (contrary to current US law), I do believe that communities are like people and should be treated like people. To give external shareholders unilateral control over the life of a working community is wrong; it is not as bad as slavery, but it is wrong for the same reasons that slavery is wrong. Most corporate governance is geared toward injustice of this kind: giving a few the ability to control the many, to remove their means of livelihood, destroy their lives’ work, sever the relationships they have built, and squander their pensions.

A moral system of corporate governance must respect the right of a community to self-determination, aligned with a clear shared purpose. This does not mean that a community’s leaders should be powerless; on the contrary, those people a community chooses to lead it should be handed as much power as necessary to ensure business is done effectively. This power should be a delegation, however — it is held on behalf of the community. Self-determination also does not mean that shareholders, even external shareholders, are powerless. They should have a voice with exactly as much weight as any other stakeholder group (including employees) in the top-level governance of the corporate entity which provides legal structure to a working community.

When you are considering how this might apply to your own company, ask yourself this: “Do I want the power to destroy, or the power to create?” Current legal power gives majority owners the ability to destroy their companies, as we see in the Market Basket example, but the ability to create is fragile. It comes only with the enthusiastic engagement of employees (and customers, and investors, etc.). By adopting governance which constrains your power as a majority owner or chief executive, you force yourself to respect the voice of your working community. That respect buys engagement in a way that nothing else can. By giving up the unilateral power to destroy, you gain the power to create, working with the community you serve.

If you want to take practical steps to act on the ideas here, I suggest looking into Sociocracy. Although employee ownership (including worker co-operative structures) moves in the right direction, the best available model is the sociocratic one, in which multiple stakeholder groups have a voice in the governance of the company, and yet most decisions are made rapidly in the frontline teams where work is actually delivered. I see Sociocracy delivering on the promises made by employee ownership, providing effective particpatory management and governance to match the changes begun in an employee-ownership initiative.

I hope this is thought provoking in a useful way. What do you think?

When do you not want an agile team?

For the past few years I’ve been an agile enthusiast, and I still am. But when we talk of scaling agile to the organization, it is easy to forget that agile practices work well under certain conditions. Many teams in an organization will not be able to create those conditions, and standard versions of agile rituals will not work as well for them as other “project management” approaches. This is old news, going back to the 1994 classic “The Wisdom of Teams” at least, but I don’t see it shared in most descriptions of “how to scale agile”.

In “The Wisdom of Teams”, the authors describe a productivity curve — the Y axis is productivity, and the X axis is how close a team is to being “real” or “high-performing”. The most interesting thing about the curve is that there is a substantial dip in productivity just at the start. To the left of the dip, a team is not really a team — it is a working group, with a clearly defined leader coordinating the work. The dip represents a period of self-organizing (often described with the classic Forming, Storming, Norming, Performing cycle). On the other side of the dip, we have teams with progressively more of the qualities we would consider to be “agile” today, enjoying ever-greater productivity.

The key is, if your team cannot work closely together in the same physical or virtual space, with constant easy informal communication, with every member taking responsibility for the work of the whole, then your team cannot make effective use of agile practices. Formal delegation and differentiated roles are necessary if the team’s ad hoc coordination takes more than a few seconds to arrange. Literally three seconds! I think the process of making a phone/VOIP call is long enough that it requires a context switch, and that means that the work stops. When I say “the same virtual space”, I mean working with the IM chat window open or conference call running, for hours at a time.

There are hacks available — for example, arranging work sessions where everyone is online at the same time, or working from the same office (or cafe). But unless this is the only way your team works, you will still need to divide up the work, which implies more structure than is usually part of “best practice” agile.

The approach used in sociocratic organizations represents a good example of how you can scale agile with a mix of team / working group types. Each team (in Sociocracy, a “circle”) meets at least once a month to do the team learning and decision-making that makes agile or lean teams into “guaranteed learning organizations”. At that time, they have the characteristics of a “real team”, setting their methodology together and taking ownership of their outputs as a team. Between these “circle meetings”, however, some sociocratic circles use agile ritual, and others use classic approaches such as PRINCE2, with a high degree of coordination and direction from an “Operational Leader”.

In sociocratic organizations, a double-link connects teams up and down the functional hierarchy. It provides guidance from the general teams to the more specific and provides feedback from the specific to the general. A lead link (the “Operational Leader” just mentioned) provides a downward connection from the more-general circles to the more-concrete ones; a measuring link (a “Representative” elected by the more-concrete circle, who participates in the monthly “circle meetings” of both lower and upper circles) provides an upward connection. Thus, each circle has a well-defined structural connection to the circles above it (and below it). With the structural feedback loop built into the organization by these two roles, each circle is tightly coupled and dynamically steerable — whether they use agile processes internally, or more elaborate formal structures.

Does my description of “when you can’t use agile” match your experience of working in various teams? Are you familiar with other ways of scaling agile which don’t require every team to use the same methodology? Let me know!

Moving Together: Teaching the Principles of Sociocracy through Physical Play

I enjoyed leading an experiential session for the IMTA (International Movement Teachers’ Association) in early June — at the moment I’m calling it “Moving Forward Together — Experiencing the Principles of Sociocracy through Physical Play”. I’d like to share some brief rough notes with you on how that process worked; please feel free to experiment with this program and let me know what you discover. Note that if you are not an experienced Sociocracy practitioner, or you are not experienced in leading groups in movement exercises, you may not have the necessary background to make full use of this material. Please feel free to contact me with questions. [Also, I make some generalizations in my description — please forgive me if I am inaccurate in describing you!]

My plan was to work my way through each of the core principles of Sociocracy — Consent, Circles, Double-Linking, and Election by Consent — in an experiential way, with a minimum of explanation.

I started with explaining my intention with the experiential workshop, and checking whether people were willing to explore with me. Nobody was unwilling; this was our first consent decision, which I noted and celebrated. I then shared a very brief explanation of the concept of Consent in Sociocracy — the willingness to move forward together in an experiment, on the basis that there is no visible danger that will prevent us from accomplishing a shared Aim.

Without taking more than one or two questions, I asked people to get into groups of three. Each group chose a Goal, a Mover, and a Sensor. The Goal would make an animal noise, and slowly move around the room. (I asked each group to consent to the animal noise selected by the “Goal” — this was intended to symbolize the standard practice of consenting to a proposed Aim). The Mover would close her eyes, and move toward the Goal until she reached the Goal. The Sensor would stay with the Mover (perhaps touching) and say “safe” or “danger” as they went. Participants seemed to understand the instructions, and began play quickly.

As they moved, I informed them that once they caught the Goal, they would all switch roles.

After several rounds of this, I gathered people for Q and A in the large group. Predictably, people had made lots of useful discoveries. I did my best to answer questions, share my experience, and ask more questions.

Then I asked the groups of three to join together into groups of six. I gave each group of 6 a pillow. Now the pillow represented an Aim, a specific piece of value to deliver to the Goal. Each group of six was to choose a Goal by Consent. Then the Goals moved off into the room, and each team (circle) linked hands, closed their eyes, and followed. I had suggested to them they would need to call out ‘safe’ or ‘danger’ as they went, and this was essential to avoiding the various pillars and tables in the large space.

After several rounds of exploring in groups of six with some variation, I gathered people in the large group for more reflection. We explored what it was like delivering the pillow together, and how people felt when they all had their hands on the pillow, versus how they felt when only some of them did.

In any case, after a round of reflection, I asked them to double up their groups of six into groups of twelve. But before doubling up, I asked them to each elect a representative who would provide a link to the other group. I think this may have been the least useful element in the physical exploration, because I am not sure they really experienced the value of the double-link. In the future, I might try having the groups connected in different hand-holding patterns, to symbolize relationship patterns. This would clearly demonstrate that a two-person link is more robust and easier for coordination than a one-person link. In the exercise as we did it, I believe the double-link principle was mostly lost.

In any case, as they did multiple iterations of the game with the larger groups, I invited them to consider together between each round whether they wanted to make any changes to the game to make it more fun, a better learning experience, or just to help them feel more alive. This produced a variety of responses — some groups got more effective at delivering the Aim but found they were having less fun, which provoked the question for them of what their true Aim was. Several group noticed that if they consented to a new experiment quickly, they were able to spend more time playing and less time talking, even if the experiment wasn’t the one they most personally favored.

After several rounds of play in 12-person groups, I called everyone in for a final large circle discussion. I invited people to share what they learned, and reflected alongside them on our learning. The responses I heard from the group were strongly positive — they had enjoyed the playful exploration, and they felt enthusiastic about using such a dynamic system for steering their organization. The applause was warm — although not as warm as the applause following our next session, when we used the sociocratic method for electing new board members and making some policy decisions in their General Assembly. They enjoyed the experiential play, but they appreciated it even more when they saw that they could actually work this way.

Game Design is Necessary

Games are about, among other things, freedom. To design a game is to create a system in which people are free — free to play, free to explore, free to excel. The boundaries — rules, game board, etc. — define the space of freedom.

Those who are familiar with governance best practice (for example the Carver system of corporate governance, also known as “governance by policy”, or the sociocratic system of governance) will recognize the idea of a bounded space in which players are free to act to accomplish their shared goals.  

The value of freedom in an organization cannot be overstated. People require clear boundaries, but when the boundaries are completely prescriptive — when there is no room for experimentation or improvisation or learning in one’s work — people begin to suffocate and die.  

The past twenty years of research into the phenomenon of Flow illustrates this point well.  As pioneering researcher Mihaly Csikszentmihalyi has shown, people thrive in environments where they experience the right balance between challenges and their skills. 

This chart illustrates that balance. Where people must bring their best-developed skills to bear on significant challenges, they enjoy peak experiences in the ‘flow state’, where the sense of time falls away and deep fulfillment occurs. When challenges begin to outstrip a player’s skills, that person moves first into arousal, then into anxiety. When skill outstrips the challenge, a player moves into control, then relaxation.  If neither challenge nor skill is high, the player experiences worry, apathy, and boredom.  This is true in games, and in the workplace.

(Thanks to Wikipedia contributer Oliver Beaton for this chart).

In order to confront meaningful challenges, a player must be free to experiment and apply skill to meaningful choices.  The art of game design is, in part, the art of defining meaningful choices and challenges in a way that matches players’ skills.  For that reason, we know that game design is essential to the Genius Organization: the task of drawing out the genius of employees and customers requires us to consider the games that will leave them most creatively alive, and to set up the rules so they are free to face those challenges at the appropriate time.

I Love Games – especially games that are great businesses, too

Cross posted from the blog.

I love games.  Jane McGonigal gave a TED talk on her inspired plan to get us all playing socially transformative games — brilliant — but as she so clearly describes, the idea is not new (watch her talk for the stunning and archaeologically supported premise that the Roman Empire was founded by gamers).  But her ideas are also not new for those on the cutting edge of 21st-century business.  Jack Stack wrote Great Game of Business about a 1980s employee-buyout of an American manufacturing firm that has since prospered due to what Stack describes as ongoing game play.  Michael Gerber’s E-myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It is a classic, in which he describes exactly how small business success depends on giving employees and customers a “game worth playing”.  And one of my favorites, Pine and Gilmore’s The Experience Economy: Work Is Theatre & Every Business a Stage is a clear and comprehensive description of how to craft the game worlds in which we play.

Businesses that don’t work suffer from bad game design.  From this perspective, cash flow is a symptom, a sign that people are engaged in transformative play, creating value together, passionately recruiting new players — or that they are struggling to get by in a zero-sum game where the winners don’t share.

I was delighted when I realized that the best system I’ve found for organizational design, governance and management (whoa! that’s a lot already!) is actually a gaming system.  In this post, I’ll address one portion of that system in particular — the requirement that each individual and each team (as well as the organization as a whole) have a vision, a mission, a set of aims, a domain and policies.  I’ll explain here how each of these elements is like the elements of other game systems with which you may be familiar.

The vision is a description of the winning conditions.  In chess, it is when you have placed your opponent’s king in check-mate.  In more immersive games (online or offline role-playing games, for example) the winning conditions may be more flexible — completing the chronicles of a particular set of characters, saving the world from a particular villain, or solving the full set of puzzles faced by the players.  In business, a good vision statement gives players an ultimate goal that can remain viable throughout the life of the community — something that can never be fully achieved, but is always worth striving for.

The mission describes broadly what will happen during the game — what the players will be doing.  In chess, your mission might be to “take pieces and control territory.”  In role-playing games, the players’ mission is often “take on the role of a heroic character, solve problems, and have fun.”  As I mentioned previously, a sociocratic business is structured with missions for the org as a whole, each team, and each role (and a person may play several roles).  The individual role mission might look a lot like that in a role-playing game…

Aims are not just specific goals — they describe an exchange that takes place.  The aims are how you score!  In chess you offer your opponents an attractive but disadvantageous series of trades in pieces and board location.  Each piece you capture is considered to be worth a certain number of points.  In role-playing games, players score by telling good stories, role-playing well and achieving in-game objectives (which depend on the game, but might include completing quests or killing monsters).  In most role-playing games, the storyteller and other players reward each other with points for doing those things.  In business, an aim may be as simple as “farm fresh eggs, $2.99″.  It is an offer in exchange for money (the “points” we play for), ideally phrased to emphasize what makes the offer unique, and put in language the customer will understand.  As a player, I will be rewarded according to how many eggs I sell, how many chess pieces I capture, or how fun the story is that I create with my fellow players.

Domain, in chess, is the board and pieces.  In a role-playing game, the domain is the imagined world the players share, and the tools — books, dice, paper & pencils — that are used to play.  In a business team, it is the area of the team’s responsibility and authority — a web site, for example, or a work place, and possibly a budget and set of clients as well.  In the language of Jesse Schell’s The Art of Game Design, (another book I strongly recommend) it is the “game space”.

Policies are the rules.  This is probably the easiest element to understand.  Policies tell us how we work toward our Vision by doing our Mission by accomplishing Aims in our Domain.  The rules in board games are often written, and brief enough for everyone to remember them all.  Not a bad idea!  In computer games, rules can be much more complex because the computer remembers them for us (and following them is easy).  This is key — keep your policies as simple as possible!  Remembering the rules can take energy you would otherwise use to accomplish your Aim.

So you see that sociocratic business design is in fact a game design system!  If you want to use the remarkable store of work on game design and business design, I suggest you do it through a sociocratic context.  I will publish more posts on this subject in the future.