If you had entered the office of Africa and Middle East Refugee Assistance (AMERA)—a refugee rights NGO in Cairo, Egypt—at the organization’s peak, it probably wouldn’t have felt like anything special. Yes, it was a busy environment; it had committed staff and community facilitators, and a successful internship program; and it did quality work. But many social entrepreneurship organizations have these qualities.
Recently, however, after reading a fascinating book by Frederic Laloux called Reinventing Organizations, I found an explanation for what made AMERA different. The book tells the story of unique form of organizational paradigm called teal. While terms like flat hierarchy, holacracy, and self-management describe parts of the teal model, based on human developmental theory, Laloux shows that teal is the latest and most advanced stage of organizational development. He makes a strong case by showing teal practices from 12 pioneering organizations—both small and large (100 to 40,000 employees), and profit and nonprofit. Each has three traits in common: self-management, wholeness, and evolutionary purpose.
In the business sector, many companies are adopting the teal model or parts of it. According to HolacracyOne, 500-plus organizations are using holacracy. The largest of these is Zappos, an online retailer acquired by Amazon for $ 1.2 billion in 2009. Even giants like Procter & Gamble and Google, despite not switching totally to teal, have started to take some piecemeal steps. In the nonprofit sector, fewer organizations have adopted teal. One of the best-known examples is Buurtzorg, a Dutch healthcare nonprofit widely recognized for its amazingly self-organized teams of 8,000 nurses. Another example is Resources for Human Development (RHD), a US-based social services nonprofit operating in 14 states, which has its own Bill of Rights and Responsibilities that frames how its self-organized units work.
But why is teal important at the first place? Organizations usually struggle to get rid of bureaucracy but have found that consensus—the other traditional means of decision-making—is very time consuming and inefficient. By cutting layers of decision-making and other approaches, teal can save time, money, resources, and can drive innovation and agility. In addition to these pragmatic benefits, nonprofits might find the model appealing because of its promise for empowering staff. An exploration of teal practices at AMERA sheds some light on how organizations can take advantage of the approach.
In contrast with hierarchical management, self-management boosts autonomy of staff and diffuses accountability among peers rather than toward managers. Instead of tying decision-making power to senior positions, it is diffused horizontally to take advantage of collective wisdom. In adopting teal, some organizations have taken extreme steps, such as the decision of Zappos to replace its hierarchical structure with “circles.”
AMERA practiced self-management through a high degree of team autonomy and a sense of horizontal accountability. Everyone at AMERA shared their office space, including the country director, the highest authority. Teams led by team leaders enjoyed a high degree of autonomy, and accountability was diffused horizontally via team updates during the weekly staff meeting and a monthly team report shared with all staff. Bi-lateral meetings between the country director and team leaders rarely took place. Another sign of autonomy was much division of labor within all teams, leading to the creation of specialists, or “focal points,” in certain areas, such as the services of other organizations or the living conditions of particular refugee nationalities. Over time, instead of staff always directing their questions to team leaders, they began directly approaching these “focal points” for information, thus contributing to the distribution of authority.
This aspect of teal is about unmasking the professional self in favor of the true, inner self. In today’s organizations, positions usually decide how one should behave. The doctor’s coat or the banker’s suit set the boundaries for how someone in this position is expected to act, not only by the wider society but also by peers. Wholeness is based on the premise that showing the inner self is the first step towards building vibrant, trusted relationships that ultimately drive innovative, high-quality work. The teal organization Sounds True, for example, translates wholeness in not only welcoming staff to bring their dogs to work, but also featuring them on the company’s website.
Due in part to the emotionally intense nature of working with refugees, wholeness was central to AMERA’s culture. In this field, people are more inclined—but sometimes unable—to keep their professional mask all the time. It was tradition at AMERA to have bi-weekly relief sessions, where colleagues shared stressful issues and difficult emotions with each other, and sometimes meditated. The responsibility of chairing these meetings rotated between staff members, including the team leader—another sign of self-management. They contributed significantly to breaking down professional shields, and revealing the true passion of staff and interns. Practices like these can also drive innovation. Because staff members were passionate about their work, they were more inclined to find innovative solutions for problems (like housing) that refugee families faced, even if it wasn’t in their job description.
Evolutionary purpose is doing what the organization is “called to do.” Underlying this is a hypothetical assumption that an organization is a living entity that evolves over time—so why limit its potential with a static, pre-defined mission? This resonates with recent calls to give-up rigid strategic plans in favor of a more flexible, adaptive strategy. In teal organizations, the other two teal traits—self-management and wholeness—enable evolutionary purpose. Self-management allows staff to help shape the organization’s direction, while wholeness eliminates organization-centric drivers such as growth and competition.
AMERA started as a small legal aid initiative and evolved into a holistic NGO that provided a wide range of legal and psychosocial services to more than 1,000 refugees every year. If it remained bound by its original mission, thousands of refugees would not have accessed psychosocial services, including education, health, and financial assistance, and psychiatric treatment. Because evolutionary purpose entails limiting organizational-centric drivers, success at AMERA was measured not by number of refugees served, but by increased access to rights or improved wellbeing. To serve the higher shared cause, as required by evolutionary purpose, AMERA adopted an extensive referral system to many partners with the aim of empowering refugees to claim their legal and social rights.
Challenges of teal
Becoming teal does not come without challenges. Although self-management empowered and motivated AMERA’s staff, in some cases, higher-ranking staff had to develop a stronger sense of wholeness to overcome a feeling of being unprivileged. On the governance level, teal organizations require that boards take a more hands-on role—not by micro-managing but by becoming a neutral arbitrator. A number of times, team leaders needed to ask the board to intervene when there was deep disagreement over fundamental issues.
More importantly, we learned that organizations need to couple evolutionary purpose with delicate, realistic attention to the resources it needs to survive and continue to evolve. Although AMERA was doing excellent work, it was not systematically well-documenting progress or communicating its achievements to donors for fundraising purposes. As a result, the organization faced serious financial struggles and in 2013 merged with the Egyptian Foundation for Refugee Rights, another Cairo-based NGO. The various examples that Laloux mentions in the book show that financial growth is a by-product of becoming teal, but the case of AMERA clearly cautions this finding. Although self-management and wholeness drive organizational success and quality work, evolutionary purpose requires stewardship.
One final word
At AMERA, the teal model was not intentionally designed, but rather evolved organically. I hope its story serves as an open invitation for nonprofit organizations to search internally for teal practices. Without documentation of successful and failed teal experiments, the nonprofit sector won’t be in a position to leverage the benefits of teal. At the end, it is not about arguing for or against teal; it is about finding the right balance between self-management, wholeness, and evolutionary purpose for your organization.