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210 Zappos Employees Respond To Holacracy Ultimatum: We're Out

The company is finishing its transition to a radical new organization structure. Nearly 14% of the staff has decided to leave the company.

[Photo: © James Leynse/Corbis]

What would you say if your boss told you wouldn't have a boss anymore? No, you're not fired. Your organization is just redistributing power, eliminating managers and job titles. Sound crazy? The concept, known as Holocracy, is gaining steam at some reputable companies.

Zappos, perhaps the most well-known adherent to Holocracy, just confirmed that nearly 14% of its staff (210 people, out of Zappo's total workforce of 1,503) have accepted an offer to take a buyout rather than ride out the transition to full-blown Holocracy, the Las Vegas Sun reports.

That's a pretty big chunk of the company's workforce, but then again, this is a pretty radical change. What's more interesting is that the vast majority of Zappos employees took a look at the company's ongoing experiment with Holacracy and effectively said "Sure, let's give it a shot."

The buyouts come after a leaked memo from Zappos CEO Tony Hsieh offered employees a smooth and sympathetic transition off the Zappos payroll:

As previously stated, self-management and self-organization is not for everyone, and not everyone will necessarily want to move forward in the direction of the Best Customers Strategy and the strategy statements that were recently rolled out. Therefore, there will be a special version of "the offer" on a company-wide scale, in which each employee will be offered at least 3 months severance (and up to 3 months of COBRA reimbursement for benefits) if he/she feels that self-management, self-organization, and our Best Customers Strategy and strategy statements as published in Glass Frog are not the right fit. (For employees that have been with Zappos for 4 or more years, the offer will be 1 month for every year worked at Zappos, along with up to 3 months of COBRA reimbursement for benefits.)

That is, if employees were in good standing with the company and could demonstrate that they're familiar with the principles of Holocracy (but simply do not agree with the approach), then they could opt to take a buyout rather than stick around. It seems most of them agreed.

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