Is A Top Down Corporate Governance Structure Truly The

811 WordsJan 22, 20174 Pages
Is a top down corporate governance structure truly the most effective way for a company to operate? Would a company that allows employees the leeway to self-govern be more effective? Companies are currently experimenting with this very question. Companies like Zappo’s have decided to experiment with a new business structure which eliminates traditional managerial roles and job assignments. Instead employees are empowered with the ability to self-manage. Holacracy.org (2017) describes holacracy as way to bring back “structure and discipline to a peer-to-peer workplace.” Companies are currently experimenting with this new way of running business which allow for less job assignments and more autonomy in the business environment. How…show more content…
The link lead would ultimately be responsible for assigning and reassigning the roles as discussed during these meetings. It is the responsibility of the link lead to give advice to the group and assign the roles. These groups can also identify missing and necessary skills which they can identify to the human resources office if new hires are necessary. If there is no true “boss” how are the rules enforced? Bernstein et al. (2016) describes how each employee should have a Collogues Letter of Understanding (CLOU). This document outlines the employee’s responsibilities, activities and overall goals. This document is negotiated at a minimum of annually, but is a flexible document which can be renegotiated at any time. The CLOU will also detail metrics for performance evaluations and reviews. This business structure has many advantages. It empowers employees to identify shortfalls or problems and correct them. Employees identify their strengths and are encouraged to explore them. Under this business structure employees are encouraged to communicate with each other. This business structure is highly adaptable. Employees have autonomy and truly control how the business in operated. This business structure also has many drawbacks. The first drawback is that compensation is complicated due to the multiple roles a team member holds. Zappos has implemented a badge system to help distinguish what an employee should
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