Scaling agile with Sociocracy

We are currently experiencing a paradigm shift in both enterprise and startup culture towards agile. Yet most of the agile transformations fall short of their expected benefits: things usually improve for a while, but then stagnation or even deterioration creeps in.

Agile software development is focused on delivering customer value. Governance in organisations is implicitly or explicitly focused on delivering shareholder value. The traditional way organisations are structured and governed creates a tension: The pull of the customer does not correspond to the way information and decisions travel along hierarchies. Decisions are often made far from the point of the highest density of information about the issue at hand, which affects high level topics as business strategy and portfolio management. At the same time crucial information is often not available at operational level, because it somehow gets lost travelling along the hierarchies.

Agile and lean software development is usually implemented in a company to decrease time to market: through reflection on iterations teams identify and remove impediments to fast delivery . This works well for impediments in the area of influence of the agile teams, but in most cases change is limited to the scope of the R&D department. Two main reasons for this are communication problems between engineers and executives, and reporting lines that ignore the pull of the customer.

In many cases the system of governance for the company hosting an agile development unit is simply unfit for agile culture: structures, decision making processes and incentives are often in direct opposition to agile values and principles. In such an environment, agile withers and dies.

Sociocracy is a whole system approach for efficient governance, inclusive decision making, and the ongoing evaluation and improvement of an organization. It provides an elegant solution for both problems described above, a structure of circles with double links to make sure information travels effectively into both directions, and a decision making process that allows for participation of delegated experts in the decisions that affect them.

As form of governance that is similar in kind to agile, Sociocracy proves a perfect host for agile departments or teams, and it allows for effective collaboration of agile and non-agile groups.

Being transformational and lightweight, and avoiding many of the pitfalls of “traditional” governance systems, Sociocracy ties in perfectly with existing structures in an organization, and slowly evolves and scales them as necessary.

Iterative discovery (or emergence) of the minimal set of policies that are required to effectively run an organization, and a decision making process which allows for fast and sustainable agreements without lengthy discussions, make sociocratic organizations more resilient to a changing environment.

In the 21st century capital is no longer a scarce resource, but talent is. The system of governance an organization employs not only affects customer and shareholder value, it also affects motivation of every member of the organization. Since Sociocracy allows for fast decisions yet includes the perspective of everyone who is affected by that decision, it fosters high performance and motivation. Attracting and retaining talent is a competitive advantage that can’t be missed.

It is not incidental that Sociocracy’s feedback loops for policy making (Lead – Do – Measure) are as effective as the Lean Startup Method‘s feedback loop (Build – Measure – Learn) is for products, although the former precedes the latter by several decades.

Sociocracy can be implemented as a whole or in parts, or as specialized forms (such as Holacracy), and supports any style of management so you can pick the one that seems most effective in the given context.


I will soon add other blog posts about Sociocracy, here’s a list of all posts with the tag “Sociocracy”.

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