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Zappos to employees: Get behind our ‘no bosses’ approach or leave with severance (washingtonpost.com)
52 points by lambtron on April 1, 2015 | hide | past | favorite | 83 comments

Metafilter linked to this Re/code article about the holacracy yesterday:


A couple friends and I were talking about whether this is a cult. I said it was missing a religion, because it had optimized out the unnecessary parts of a cult. Another said it was the religion of messianic capitalism.

Most cults and religions are much more organized. One comment on Mefi yesterday caught my eye:

"I heard about that memo a week ago. It is a total shitshow over there. The worst is the customer service reps, who now set their own schedule. As a result, nobody is there during peak hours"

Considering that Zappos' customer service is pretty much their claim to fame, this is going to get interesting real fast.

I've also seen some mentions that Zappos was adopting a "surge" pricing system for hourly employees to entice the reps to work the less desirable shifts. I'm really curious about this part.

So ordinarily I'd just upvote this comment (and I did), but...this article is so eye-poppingly terrifying that, if accurate--and I have no real reason to believe it's not, it's written in the most kid-gloves style I can think of--makes me genuinely worried about everyone involved.

Work is a social phenomenon. People aren't robots. What the heck are we doing to ourselves?

If you're not worried enough, see the prior article about the suicides.


Fortunately, some smart-thinking entrepreneurs are there to, uh, disrupt depression with a startup mental health clinic and a startup church. Or something.

My company does this "no bosses/titles" bullshit too. We have, of course a CEO, there is a CTO and a VP and a director of engineering and then me. When I ask for a promotion to Principal Engineer from my current Senior Software Engineer role(that was on my offer letter) they say "we don't have titles"!

It's all bullshit and there is always a hierarchy. My company did it really badly by letting my bosses put titles in their LinkedIn profiles, Zappos may do better in that regard but there would always be someone who overseas you. As other comments mentioned the irony is "the CEO" said all of this!

The problem is imho we as society are still shitty in management of knowledge workers:

- we still think in titles (hierarchy) vs roles (context) - eg someone can have the role product strategy and that gives him ownership about certain decisions

- we still thinking of "managing people" like of "managing resources" vs setting up processes and communication when processes fail

So, I'm one of the more highly-skilled developers working on X. I'm also needed to help troubleshoot some emergency on Y for a week.

Someone has to figure out schedules priorities and whatnot. But I don't give a $#@% about that sort of boring people-stuff, because I only care about interesting technical problems.

How does this get handled?


People do not always follow the same process over and over again. When they do, that's an excellent candidate for automation.

People can have multiple interests and skill sets, but those won't always include negotiation and constraint optimization. Those tasks still have to get handled for everyone, even the people who won't handle them for themselves.


There will always be hierarchies. There are at least two fundamental ones: skill, and scope. Neither maps exactly to management hierarchies.

yes but we bundle a lot of things into the term management

hierarchy will always exist (if at least someone has to pay or fire you)

authority will always exist (if at least someone will be more experienced in a topic)

processes will always exist (and someone has to put them in place)

you can have processes in place for emergencies, deciding if those emergencies are worth dropping stuff, for boring bugduties etc

the shift is imho not so much about making everyone his own boss but about pushing decisions as far as possible "down the chain" until you do no longer need to think in "hierarchy chains" but roles and groups of people

I worked for a company with a 'flat' hierarchy. There was actually a secret hierarchy, and I got pushed out for defying the secret hierarchy. The structure allowed the 'managers' to avoid any accountability.

This is actually a fairly old and well-known idea, first proposed in the 1960s.

"this apparent lack of structure too often disguised an informal, unacknowledged and unaccountable leadership that was all the more pernicious because its very existence was denied."


People interested in ultra modern flat management structures would do well to look up the history of communes, collectives, and other experiments in self-organizing.

Isn't there often "informal, unacknowledged and unaccountable leadership" hiding within traditional hierachical structures? It's often not fully apparent from the organizational chart who has real power and influence.

Also see https://en.wikipedia.org/wiki/The_Sirens_of_Titan

Specifically about Martian colony and how decisions were made there.

>The structure allowed the 'managers' to avoid any accountability.

Privatizing power while socializing accountability/responsibility :)

The real question for me is: Has Tony Hsieh completely lost his fucking mind, is this the future and we just don't know it yet, or is this all part of some elaborate plan to fire everybody or stage some sort of internal company cleansing?

Seriously - somebody please tell me.

I don't get it.

It's the natural result of all the hippies growing up and finally reaching "management consultant" age over the last 10 years or so. ;)

There's always been a handful of smallish companies where everyone is skilled enough and get along well enough to not bother with traditional management. And because everyone is highly skilled and play nicely together, they tend to do very well. And since they do so very well, the obvious difference (lack of standard management roles) is obviously responsible and becomes a topic for fad business books and expensive seminars.

so what happens when there is a successful business, often times people running that business think that just because they've had some good ideas and successes, all their ideas must be good and profound :) I don't get it either, but maybe I am wrong

I just love this:

"A new circle called Reinventing Yourself has been created to help guide former managers to new roles that might be a good match for their passions, skills, and experience. Hollie is the lead link of that new circle"

So, Hollie is a manager of managing former managers' efforts to no longer be managers ?

No, not "manager," "lead link." You just don't get it, man. You just do what you're told by the people who are better than you. They're not your managers! They are just 'better' so they deserve to tell you what to do and how to do it.

There are democratic, non-heirarchical corporations out there, like Mondragon.

They grew a bit more organically than this, however, so the structural result is very noticably different.

> They grew a bit more organically than this, however, so the structural result is very noticably different.

Perhaps this is similar to the often stated reason for 'failed' democracies: they need to grow rather than be forced upon a population?

So screw over anyone in a lower position than director. Next up, no more hourly employees so they can work then without overtime pay. (oh wait that is now standard)

How will they handle accountability without bosses? Decisions are likely to get made by the more outspoken or celebrity personalities. How will they accurately identify weaker decision makers in this category as where they spread influence is a 'group decision'. At 1500+ employees this could easily end up into some political minefield of power struggles and blame/credit games.

who is going to write performance reviews? Titles or no titles, whoever writes your review is your manager.

I think this kind of system usually gives that to a committee. Which is either elected, or drawn from who you work with the most.

Or you write it yourself, and then it goes to the committee for grading.

Even with formal committees there is always somebody who is really in control. I grew up in the USSR, the country which was supposedly built on the idea of committees :)

Or it turns into Enron and the committee is just a massive scheme for back-stabbing and horse-trading.

I was going to say, this sounds a lot like "soviets". >.>

Valve has the 'Gabe / Everyone Else' structure. They seem to make it work ok. Performance reviews are written by your peers, usually people who worked with you in some way recently.


Jeri Ellsworth (ex-Valve employee) will disagree with you here.

"There is actually a hidden layer of powerful management structure in the company," she claims.

"And it felt a lot like High School.

"There are popular kids that have acquired power, then there's the trouble makers, and then everyone in between. Everyone in between is ok, but the trouble makers are the ones trying to make a difference."


>"And it felt a lot like High School.

"Called "holacracy," the new system replaces the conventional command-and-control workplace with a series of self-governed teams, known as "circles." "

i first read it as "cliques" :)

> Valve has the 'Gabe / Everyone Else' structure. They seem to make it work ok.

Except for the whole Half Life 3 issue. The fans have been clamoring for it for years, presumably someone in Valve wants to make it... but the company has been unable. I don't know if it's they've been unable to keep a project going strong before the team splintering, or there's several competing internal projects, or if there's one which is being unmanaged and so is growing unboundedly, or something else entirely. But something's going wrong there.

Easy, take a 360 approach to reviews from those you work with during the year regardless of title or lack of. IMO this would be more valuable than only having one managers viewpoint. And as a bonus this would cobble those annoying employees that focus on managing up only.

Even if you're looking 360 you still know whether you are looking up or down.

If a company is big, old, and sclerotic enough to have a formal performance review system, it's time to get out and find somewhere less soul-sucking to work.

(only somewhat joking.)

There can be hierarchy without managers I.e. People whose primary job is managing other people.

Holy crap. Zappos sounds like the unholy spawn of a pyramid scheme and a cult.

'Tis true. I worked there. They notoriously pay poorly and the only people who move up to better pay are FOTs Friends of Tony. All of whom have been there for a minimum of 10 years. BTW-Tony has not changed his title on his LinkedIn, email or business card. He is still CEO. The rest are titleless and looking for other jobs.

We had 3 suicides last year by entrepreneurs tony invested in and took under his wing here in Vegas as part of the Downtown Project dystopian hell he makes zappos employees live in here.

Cult. Pure and simple.

I think it is pretty clear Tony Hsieh isn't the right person to lead Zappos at this scale. His craziness got it to where it is today, but what you need from a CEO changes with scale.

Does HN need a top banner saying that it's April 1?

>Zappos CEO Tony Hsieh

Oh the irony. So basically what I gather is Zappos is trying to find a way to drive down the salary of all employees by removing their titles. Except for the executives... because you HAVE to have executives, even with fuedalism... er... "holacracies".

>Hsieh's memo says they will keep their salaries through the end of 2015 and will get guidance for reinventing themselves into new roles at the company.

Yup... "We want to gut all the high paying jobs from our organization by giving the rest of you the job your managers had before. Hope you enjoy the additional job titles, we won't be increasing your salaries".

Look at yesterday's top topic here, the new Facebook office "largest open floor plan office, ever". This sort of disrespect, this sort of complete dehumanization of the worker, it's the new normal. "Our employees are our greatest asset" is just something to print in the employee manual.

Eh, I don't see any problem with either open-floor-plan offices or with a lack of managers. And I assure you, I'm quite human. The main reason I wouldn't want to work for Zappos is because I don't give a damn about shoes.

These sorts of moves are usually filtering functions on the types of employees you employ. They'll encourage everyone who doesn't fit the company culture to quit - which, ultimately, makes the company stronger. The beauty of our market economy is that you don't have to work in a company whose culture you find offensive, you can find one whose culture is more to your liking.

> makes the company stronger

maybe. or just an echo chamber of like minded drones?

Like most things in life, it depends on how you look at it. If you see an echo chamber of like-minded drones, it's pretty likely you aren't looking very closely, as even the most homogenous cultures have plenty of room for individual variation. (Although they may not let you, as an outsider, see it.)

Sure, but you have to admit it can also product Enron like negative feedback loops where bad behavior is okay, and rewarded, due to culture.

A company is not a nation of people separate from the people that comprise it, it can't have a culture unto itself. What people call "company culture" is just code-word for lazy management at best, discrimination at worst.

It certainly can - culture is just the sum total of the things that a group of people do without thinking too hard about them. Any group ends up with a culture, including companies. And when large numbers of people either leave or enter the group, the culture invariably changes.

The beauty of our market economy is that you don't have to work in a company whose culture you find offensive, you can find one whose culture is more to your liking.

<cue civil rights movement>

<cue women's rights movement>

Maybe for the most part now that those are done, but I'm sure there's a few things left.

<cue religion-vs-LGBT flamewar>

<cue women-in-silicon-valley flamewar>

Could you expand on that thought a little? I'm not clear how Facebook's open floor plan is dehumanizing.

It treats people like cattle, thrown into the same homogeneous pen together. It can't possibly be about "collaboration" because private offices don't impede on collaboration. It's about fitting as many people into as cheap of a space as possible. And because Facebook has done it, now everyone and their brother is going to start implementing it in their startups, if they haven't already.

People used to complain about not having a corner office, then about having a cubical while the VPs had offices. Now no one has an office but people still complain. It's impossible for Facebook to give all of its employees offices, so what's the best solution? (People are overreacting to a single sentence by Zuckerberg anyways, the new Facebook headquarters has tons of conference rooms and private nooks.)

Facebook nets something like $3 billion a year, and has somewhere around 10k employees. You could give every employee a mansion in Iowa (or a small condo in San Francisco) for that amount of money. I doubt allowing employees a little private space will break the bank for them.

It's impossible for Facebook to give all of its employees offices, so what's the best solution?

Why is it impossible?

Because Facebook has thousands of employees. I suppose it might be possible to give everyone a closet sized office.

Microsoft has shared decent size 2 people offices for thousands of developers.

> private offices don't impede on collaboration

Source? At the most basic level, having a wall between two people makes it harder to collaborate than no wall by the sheer fact that the other person can't hear you.

If a wall is all it takes to impede collaboration in your office, then the wall is not the thing impeding collaboration in your office.

I said at the most basic level, as in, hey, here's this extremely oversimplified yet fundamental issue to collaboration you get in private offices, which is that it is harder to communicate. Regardless of your thoughts or beliefs, it's just plain easier to ask someone on your team a question face to face rather than needing to open up an IM/chat/mail/hangouts/whateverthefuckitis and do it through there. It's not only easier, but it's far more fluid and will result in both quicker answers and more discussion since you don't need to open up a program, draft up a message, then wait for the other person to type up their response. It all happens in real time, quickly. And in an open office, you get this for free, you don't even need to move.

Meanwhile, you have not provided a single source to back up the pretty bold claim that private offices don't impede collaboration and instead decide to straw man that argument. I've explained the incredibly obvious and basic impediment to communication that a wall can bring, please refute that claim and provide proof that a private office does not impede collaboration.

You are dead wrong.

My last workplace had private individual offices for developers. My office was big enough to have two people working together in it full time, and big enough to have 4 people in it comfortably for 2-3 hours.

With that in mind let's talk about communication. There are a few different types of frequent office communication. Let's compare an open office with private offices for each of them.

1) a coworker is blocked and can either spend 10-15 minutes figuring out the issue on their own or can ask you to get an immediate answer.

In the open office he will usually ask you and pull you out of focus. This has a large negative impact on productivity when it happens throughout the day. In a private office scenario he works it out himself. His problem solving skills increase, and you stay productive. Big win for private offices.

2) a coworker is blocked and it will take her a day or two to work it out herself or she can ask and you can tell her the solution immediately.

In the open office she will ask immediately and you save two days at the cost of impacting you for 30 mins. Winning. In a private office she will struggle for 15-30 mins, make no progress, and then walk over to interrupt you. The open office scores a small win here.

3) a coworker is not blocked and you know the solution.

In an open office they will interrupt you. In a private office workplace they will send an email/IM and you can respond asynchronously without impacting focus. Big win for private office.

4) a coworker needs to work closely with you for an extended period (30 mins+).

In an open office you either hunt for a meeting room, or because that's usually a pain, you talk at your desks. This either holds up shared resources (meeting room) or disturbs everyone (talking at desk) so you keep the conversation/collaboration short. If you have a private office you can speak without worry leading to more collaboration. Another big win for private offices.

There are a few other common scenarios in the workplace but I think I have made my point. 1, 3, and 4 are more common and are big wins for better communication in private offices and only come at the small cost mentioned in 2.

> This sort of disrespect, this sort of complete dehumanization of the worker, it's the new normal.

When you decide to work for a CEO who called his own users "dumb fucks" for using his product, I'm not sure you should expect respect and humanization from the top.

I'm sure a lot of people who are 19 years old say dumb things . It's interesting that this is what you choose to remember.

> It's interesting that this is what you choose to remember.

Not really. Throughout its existence, Facebook has routinely made decisions that make me doubt whether it, as an organization, values people. I don't choose to remember the quote, I'm constantly reminded of it.

Then why not use a more relevant example than what a sophomore college kid flippantly said to a friend?

Specific actions are symptoms of the underlying problem, namely, the founder's low opinion of the people who use his service. That particular quote is an extremely relevant example.

If you want examples that illustrate the effects of this mindset, you can find many here: http://en.wikipedia.org/wiki/Criticism_of_Facebook

The common theme is flagrant encroachment on the privacy rights of its users, which I don't believe Zuckerberg feels his users deserve. Presumably because they're dumb fucks in the first place for using Facebook.

You could also keep the same salary for executives and share the savings across the employees.. which is probably what is being done.

So sure, that makes the gap executives-employee seem bigger, but in reality its the same. With the advantage of a flatter hierarchy.

For I have experimented some of these, I found it way more enjoyable than having 3 to 10 bosses on top of me, where you consistently spend your time:

- covering your ass

- covering your boss asses

- discussing in meetings until another boss comes over and changes everything

- having to do whatever the manager decides if its a bad manager, even thus its against the team opinion

- discussing in meetings until the boss that isnt in your range of bosses decides a political coup (approx every 6month)

- etc.

Ie, corporate life of a low-end employee.... yeah zappo's hierachy isn't near as bad as you make it to be, in fact - and while im sure its company depend, it seems rather enjoyable.

Zappos sounds pretty good to me. I work in a similar environment and I love it. There is so much joy in going to work and being your own boss and sharing in the company success. Yes, I have a manager, but my manager doesn't (can't?) tell me what to do or what to work on. My manager acts as a coach/facilitator/personal-agent instead of manager-as-god. It sounds unworkable until you work at a place that executes it well and now I can't imagine going back to a traditional corporate structure.

I'm not sure what the pre-reqs to executing it well are. Probably benevolent-ruler CEOs who own enough of the company to keep anarchy from developing (e.g., Gabe @ Valve). Or at least investors who are willing to get on board.

I had the same reaction. But I think it makes sense. It's basically a distribution center with some good customer service, so there is little use to people adding more value and climbing ladders. Meaning they only need what are essentially entry-level employees. Jobs which in yesteryear would have employed students... But now employ the undereducated instead.

At least they doing it in a nice way. Sure it hides what they are really doing by making out to be something different and fancy, but they are giving the atheists a way out, instead of going for their head (count)s.

So when Jenny in marketing makes a new deal with Adidas and promises to have their newest shoe out the door in a week, James from shipping has to stop doing his job shipping things... to have a meeting with Jenny, and then Adidas, to explain why they aren't able to meet the timeline?

To suggest that managers aren't needed because the "group can just do it", is absurd. EVERY company has multiple departments in charge of different areas of the business. The job of a GOOD manager is to insulate the "do-ers" from having to deal with other areas of the business so they can focus on doing their actual job. Removing that title and "giving it to the group" sounds like a good way to create a lot of busywork to save a few dollars. And I can just imagine that the employees are expected to still get all of their normal work done - which means working after hours to have the meetings they should be having during the day, but can't because they're doing "their day job".

Maybe zappos has some crazy unique structure to how they do business, but I'm skeptical.

I disagree. Interesting people can and do work through the ranks at companies. Additionally, a good manager is someone who can encourage and help a mediocre employee become a good or great employee. A flat team means that everyone is stuck doing the same repetitive job, and there's no one /to/ go to to discuss issues who has a bit of detatchment.

I think the point of this move is that Tony Hsieh does not want anyone who "can and does work through the ranks" to be working at Zappos. He's built a business upon great customer support for selling shoes. The ideal employee for this business is someone who is really passionate about helping customers solve their shoe problems. A manager above them would just get in the way of their helping customers, and an employee who wants to be a manager is not focusing on helping customers.

I don't disagree... But all they Zappos need is pretty much a basically functioning employee. Not any management value added. They can formulate these cells to expel any non-hackers* (those who dont meet their reqs).

You want to find some followers among the jaded, found a cult/church with a twist. It's vaguely familiar but oh so different and full of vigor. Not staid and old. Those naysayers just don't get it.

* the other meaning of hacker.

In other words it gives grunt work a new shiny sheen.

Amazon was a bookstore. Now they are much more. Nothing says Zappos can not so the same, at least in theory.

It's interesting that Larry Page also tried to have a "no manager" organization, when Google was in its infancy. The experiment was a disaster, and employees asked to have managers reinstated.

I have always considered a good manager to be a service to me as an employee, not a burden. Luckily, most of them were. When they stopped to be, it usually proved a good sign to look for the next gig, because something is rotten in that kingdom.

When you say high paying, keep in mind the jobs you are describing are $250-1000k jobs where everything (work, risk, and blame) is delegated down to the grunt level anyway and attendance is probably 50% at best.

> . So basically what I gather is Zappos is trying to find a way to drive down the salary of all employees by removing their titles.

Sounds like you've worked in a "flat" organization ;-)

As usual, Maciej was killing it:

https://twitter.com/Pinboard/status/582619098921603072 "Anyone claiming there is structure, management, hierarchy, concentration of power or obstacles to freedom at Zappos will be summarily fired"

https://twitter.com/Pinboard/status/582628592179232769 "We’ll know that Holacracy truly works when even the lowliest janitor at Zappos can threaten to fire everyone for not reading a certain book"

Firings will continue until morale improves!

Since there are 'no bosses', why does Tony Hsieh have a title like 'CEO'?

> why does Tony Hsieh have a title like 'CEO'?

even the ultimate flat organization - Borg - had Queen. The rest - no titles, just roles, and pride themselves on efficiency.

Thinking about it, one can see how modern "open office in the name of collaboration/communication" is just a cave man's replacement of Borg neural field generators for mind-to-mind connection

Even though I support open allocation, I don't really believe that "no managers" works at all. I think that it's an overcorrection.

You need management, but what you need is a constitutional workplace where there are real protections (e.g. people have the right to choose the team they work on, within reason, and performance reviews are for compensation upgrades only and not part of the transfer packet) that employees get to vote on and that limit management's power. I'd even consider extending that to a profit-sharing model that's more transparent and fairer than startup equity, which is based on some insultingly small percentage of some possibly-huge-but-how-would-you-evaluate-that number in the future.

There are several problems with "no managers". First, many tech companies tell every engineer, down to the junior coming out of college, that he'll be reporting directly to the CTO. Then he gets there and learns that he will actually be evaluated by his tech lead, who answers to a (possibly titled, possibly not) full middle manager... who answers to the CEO. It's dishonest as fuck, but really common in the startup world to use "flatness" to make a position sound closer to the action and to power than it actually is. "Flat" organizations are often alluring lies that hide the real power structures. It doesn't matter if Bob is an idiot who works 15 minutes per week; if the CEO will take Bob's word over yours when it comes to your value to the company, then Bob is your boss.

Second, if there are going to be power relationships anyway (and there are) it's better to answer to a titled manager with a completely different job description, than to someone who's technically same-rank and therefore also competing with you for work. You won't win in that situation.

I'm skeptical because I feel like managers are akin to cops. There are some really shitty cops out there, no question. But you need them, because the alternative is... that a police-like force emerges (organized crime would rather have order than violence) but it's not accountable to the public and the costs are erratic. With public police, you pay taxes and can vote officials out of office if they make bad calls. With emergent private police (thugs) the extortions and bribes can go up from day to day for any reason or no reason at all.

What's wrong in most companies is that the police are making the laws, rather than enforcing them for public benefit. Because most companies don't have any constitutional structure or real protection for workers, the law is "if you have power, you can do it" so middle management ends up making the law up as it goes, in pursuit of its own interests (maintaining and consolidating power). Management is a fine concept if management is put in its place and empowered to enforce but not legislate. I don't know how to put this into practice. It's hard, because you have to fight human nature.

In other words, the problem is the lack of constitutionality in corporate governance. Corporations are pretty much all run as dictatorships. That can work surprisingly well (in terms of efficiency and competitive supremacy) when the dictator has something unique to offer. It ages poorly, because the dictatorial role gets handed over and eventually it's in the wrong hands and everything goes to hell. Imagine what would have happened to Singapore if anyone other than Lee Kuan Yew had been in that position. Dictatorship only works when you have a very rare type of mind and get a true philosopher-king. (It's not about pure intelligence, either. It takes charisma and focus, too.) That doesn't describe most corporations or corporate leaders. For the most part, this dictatorial model leads to low morale, stagnation, and mediocrity.

That's why people hate management: we've all picked up that it's serving its own interests rather than that of the employees or of the company. All of this said, "no management" tends either to produce an emergent and less accountable management/police force or it tends to mean that power is concentrated at the top. So I tend to think that this "no more bosses" movement is somewhat of an overcorrection.

I agree that official, legible management structure is usually probably better than the unofficial management structure that will naturally emerge in a supposedly "flat" company.

You mention that most companies don't have "constitutional structure," are you talking about an employee bill of rights?

What would you think of the idea of running a company literally like a representative democracy? A constitution and bill of rights, management as elected officials, employee "voter initiatives", projects compete for talent internally etc?

It might not be perfect either, but perhaps a good middle ground between militaristic top-down bureaucracy and Zappos-style anarchy?

Yes, an Employee Bill of Rights.

The middle ground you described is a brilliant idea. What you probably need to enforce it, at first, is an enlightened dictator (i.e. the 1% who won't get power-hungry and fuck everything up).

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