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Teal Organizations: the leap to self-management

Iria Rivero

Iria Rivero

Teal Organizations: the leap to self-management
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When we talk about change management, it is not complicated to find information about techniques, tools and practices to develop the many areas we work on: self-management, leadership, transparency, communication… 

Agility puts people at the center, and when we focus on them, the possibilities skyrocket. As change managers, we cannot forget that it is precisely in the relationships between people where change starts and stays alive. A striking example of where these relationships can lead is what we can find within Teal organizations.

7 stages of development by Federic Laoux

Reinventing Organizations by Frederic Laloux

In 2016, Frederic Laloux published his book “Reinventing Organizations”.

In it, Laloux describes, first with a theoretical approach, but then with examples, different types of organizations based on what he describes as stages of development and human consciousness. These stages are associated with colors, which from less to more complex would be:   

estructura

1. Reactive stage (infrared)

It is the most basic stage—organizations based on clans, few in number, and easy relationships.

rivalidad

2. Magical stage (magenta)

These clans perceive rivalry and their evolution as a series of magical events.  

lobo

3. Impulsive stage (red)

The self-consciousness of one’s death appears. They are the most robust and most aggressive, with an alpha. It is the standard system of street gangs and mafias.

ejercito icono

4. Conformist stage (amber)

It is immersed in a tribal world, with states and civilizations, institutions, bureaucracy and organized religions, such as the Catholic Church. Each person behaves according to what is expected of them in the rank they occupy, and there is no aspiration to move to a higher level. 

idea icono

5. Achievement stage (orange)

The question “What if…” appears. There is a shift to materialism, with large organizations such as Nike or Coca-Cola. They show three fundamental advances: innovation, accountability and meritocracy. They are organizations that function as a machine, and although they are impersonal, there is room for creativity and innovation.

crecimiento icono

6. Pluralistic stage (green)

For the first time, there is talk about what works and what does not. They seek justice, equality, harmony, community, cooperation and consensus. There is a desire for more cooperative forms, but it isn’t easy to put them into practice and make them last. It brings in elements such as value-driven culture. These organizations are conceived as a family. 

organizaciones teal estadio teal

7. Evolutionary stage (Teal)

The next phase of human evolution, based on Maslow’s “self-actualized level.” People can reach a new level of development where they can manage their egos. Life is perceived as a journey of developing strengths, dealing with adversity, and striving for a new concept of fulfillment, especially in relationships with others. Based on this new stage of development, Teal organizations emerge, where ultimately, people provide more effective solutions to more complex problems

The 7 stages of organizations - Frederic Laloux

This theoretical description contains many nuances and complexities, like the fact that a person or an organization will not belong to just a single stage. Still, this framework helps us to see a more complex context than we could perceive. That is why we cannot limit ourselves to terms like right or wrong.  

What are Teal Organizations like?

The leap from theory to practice is made through 12 organizations, from entirely different sectors and products, with at least 100 employees and by carrying out Teal practices. 

Their three key developments are: 

  • Self-management, through organizations without hierarchy and where decisions are made by consent (not consensus).
  • Fullness, working with a revolutionary and straightforward idea: people are the same at work and in all other aspects of our lives, so we do not have to fulfill a role but develop ourselves fully. 
  • Evolutionary purpose, where organizations function as living organisms, in which different ecosystems coexist, adapting to changes and developing around their goal.

What motivates organizations to need change?

Most organizations share troubles, which grow in pyramidal structures, such as personal ambition, distrust and fear, often translating into demotivation, resignation or resentment. In this context, most organizations have decided that it was time to make a change, and some of them have implemented actual self-management in their structures, the first leg on which Teal organizations are based.

Functioning in a self-organized way is not easy, but the organizations studied by Laloux have developed decision-making structures that value decision-making by consent rather than by consensus. This aspect is fundamental to be able to make decisions in an agile and effective way, and it is based on the three areas of decision-making for a person: 

  • An area of personal preference: what we would choose from the outset. 
  • An area of tolerance: what we can tolerate even if it is not our first choice 
  • A line of objections: our red lines. 

The space covered by the tolerance area is much larger than if we only stay in our personal preferences, so we find a vast place to make decisions in a common and agile way. 

The secret to self-management: collective intelligence

Of course, to decentralize decision-making, it is necessary to have an adaptable hierarchy based on leadership. The most qualified person to decide is the one who has the most knowledge, interest and disposition on the matter.  

Other elements to carry it out are a fluid level of coordination, knowledge exchange between teams and excellent ego self-management. If the engine work, collective intelligence can emerge. 

To achieve this, all processes have to change, working on issues usually avoided, such as transparency, so that everyone has the information and context needed to make complex decisions. For example, the company’s financial data is in the public domain. Then, actions should be taken to ensure that all employees understand the financial information.  

Another complex and necessary aspect of evolution is conflict resolution, such as Holacracy. However, all of these require complex personal development and no small amount of effort on individuals. In short, not everyone finds their place in truly self-managed organizations.  

The second leg on which Teal organizations stand is the struggle to achieve fulfillment. It is articulated through safe and open work environments, with practices that allow discussion of values and basic norms, with spaces for reflection for large groups, and supported by various coaching techniques. It creates the development of the organization’s culture, understood as that way of doing things in a specific place without people thinking about it. 

On these two bases of self-management and fulfillment would be the third leg of Teal Organizations: the evolutionary purpose. Laloux talks about how organizations are living beings, where collective intelligence and evolutionary sense align to decide the organization’s path. 

teal organizations

What do we need to have a Teal organization?

From Laloux’s perspective, there are only two indispensable requirements: 

  1. The CEO has to share the vision. 
  2. The shareholders have to be convinced.    

It does not mean that many more elements are not required to achieve real change, but the experience so far is that there is a path of frustration that leads to failure without them.  

Are there Teal organizations in Spain?

As if it were a small Gallic village, some Basque Country organizations work with a new model of relationships. The Ner Group Association was created in 2010, with 18 organizations and more than 2000 people. It is very motivating to find close organizations that have managed to open complex paths towards real self-management with many benefits. 

Indeed, Teal organizations are not that common, but at the very least, they bring freshness and inspiration to our efforts to help keep the focus on people and the possibilities that change brings.  

Why not also find more advanced ways of relating?

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About the Author

Iria Rivero

Iria Rivero

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