What are Circles (Holacracy)?
A circle in Holacracy is a self-organizing team with a defined purpose, domain, and set of accountabilities. Circles hold authority to make decisions locally, assign work to roles instead of people, and nest inside larger circles to form a holarchy that replaces the traditional management hierarchy.
- Authority lives in roles, not job titles: Work is assigned to roles with explicit accountabilities, and any role holder can act unless governance restricts them.
- Two meeting types do all the work: Tactical meetings handle weekly execution; governance meetings change roles, accountabilities, and policies.
- Circles nest in a holarchy, not a hierarchy: Each sub-circle is connected to its parent through a Lead Link and a Rep Link, so structure stays dynamic.
- The model is high-friction at the start: Zappos lost 18% of staff after its 2015 ultimatum, and Medium dropped Holacracy in 2016 after four years of use.
How circles work inside Holacracy
Holacracy is a method of decentralized management and organizational governance in which authority is distributed through self-organizing teams instead of vested at the top of a hierarchy. Brian Robertson developed the system at his software company Ternary Software and codified it in the 2015 book Holacracy: The New Management System for a Rapidly Changing World.
The goal is to increase the agility, transparency, and accountability of the organization.
Definition: Circles in Holacracy are semi-autonomous, self-organizing groups within an organization that are responsible for a specific set of tasks, roles, and functions. Each circle operates within its defined purpose and accountabilities, contributing to the organization's overall mission.
The structure of a circle: purpose, domain, accountabilities
In Holacracy the organizational structure consists of multiple layers of circles, each nested within a larger circle. This nested layout replaces traditional reporting lines with a modular design. Every circle has three defining elements:
- Purpose: the reason the circle exists, set by its parent circle
- Domain: the things the circle controls and that other circles cannot touch without permission
- Accountabilities: the ongoing activities the circle is expected to perform
The structure is dynamic. Circles split, merge, or change as the organization's work evolves.
Within its domain, each circle has the authority to self-organize and assigns work to roles rather than to individuals, which lets responsibilities shift without renegotiating job descriptions.
The four core roles in a Holacracy circle
Roles within circles are the unit of work in Holacracy. Each role has its own purpose, accountabilities, and decision-making authority, and one person can fill several roles across different circles.
Leadership is split across four standard roles rather than concentrated in a single manager.
Role | Purpose | Selected by | Reports into |
|---|---|---|---|
Translates the parent circle's purpose into the sub-circle and assigns people to roles. Holds alignment accountability. | Parent (super) circle | Super-circle | |
Rep Link | Surfaces tensions from the sub-circle up to the super-circle and communicates outward. | Sub-circle members | Super-circle |
Facilitator | Runs governance and tactical meetings according to the Holacracy Constitution. | Circle members | Circle |
Secretary | Schedules meetings, records governance decisions, and keeps the source-of-truth record. | Circle members | Circle |
Together these roles replace the single-manager pattern: the Lead Link sets direction, the Rep Link returns feedback, the Facilitator protects the process, and the Secretary protects the record.
Why teams switch to circles
Circles are designed to solve specific failure modes of traditional management. Each benefit maps to a problem that hierarchical structures struggle with:
- Faster decisions at the edges: Circles can act inside their domain without top-down approvals, which helps organizations adapt to change more quickly.
- Less role ambiguity: Roles are written down with explicit accountabilities, which cuts overlap and "that's not my job" disputes.
- Distributed decision-making: Authority sits with the role closest to the work, which increases ownership and engagement.
- A clearer link between strategy and execution: Purpose flows from parent to sub-circle, so the connection between company-level strategy and team-level work stays visible.
- Built-in accountability: Governance meetings force tensions into the open and resolve them on a cadence, rather than leaving them to one-on-ones.
A 2024 meta-analysis of 15 Holacracy implementations by SI Labs found that around 70% of studied organizations reported improved employee engagement after adopting the model, while roughly 30% reported measurable gains in agility.
Where Holacracy rollouts typically break
Circles are not a free win. The most common failure modes show up in the first 12 to 24 months and rarely come from the framework itself:
- Constitution overhead. The Holacracy Constitution is long, and circles spend the first months learning to read it before they can use it.
- Cultural friction. Moving authority into roles only works if leaders genuinely let go. When senior managers keep making decisions outside meetings, governance becomes theatre.
- Meeting fatigue. Without a strong Facilitator, governance meetings drift into long debates rather than producing decisions.
- Scaling pain. Coordinating across many circles at scale is harder than coordinating across departments. Medium, which had used Holacracy since 2012, dropped the model in 2016. Head of Operations Andy Doyle wrote that the system "was getting in the way of the work" once the company grew.
- Exit risk. When Zappos issued its 2015 ultimatum to fully adopt Holacracy or take a severance, 18% of employees, around 260 people, chose to leave (Yahoo Finance).
These are not reasons to avoid Holacracy. They are the questions a leadership team needs an answer to before the first circle is drawn.
Companies that have used circles
Public adopters cover the full outcome range, from sustained use to full reversal:
- Zappos: Adopted Holacracy in 2013 and went fully Holacratic in 2015. The company has since scaled back several elements of the model but still uses circles in parts of the business.
- Medium: Used Holacracy from 2012 to 2016, then moved to a lighter management model when coordination costs climbed.
- Springest (now STUDYTUBE): A Dutch e-learning company that ran on Holacracy for several years and documented the transition publicly.
- Blinkist, Liip, and Hypoport: European examples that operate circle-based structures with various degrees of formal Holacracy.
These cases show the flexibility that circles can introduce and the necessity for the model to be tailored to the organization.
Circles in your broader operating model
Circles fit well alongside outcome-based planning systems. Many circle-based organizations run OKRs at the circle level: the parent circle sets the objective, the sub-circle owns the key results, and the Lead Link is accountable for the score.
The combination keeps authority distributed while giving leadership a way to see direction without breaking the model.
Two adjacent operating models are worth comparing if you are evaluating circles: the Spotify model, which uses squads, tribes, chapters, and guilds rather than nested circles, and the Teal organization pattern described by Frederic Laloux, which shares the self-management principle without prescribing Holacracy's constitution.
