Company tells staff 'embrace new structure or leave', 7% leave

After sending a company-wide e-mail in March issuing an ultimatum to adopt “self-management” or accept a severance package, online clothing business Zappos has revealed that 210 employees (14% of its staff) left the company.

Of those 210 ex-employees, 20 were managers, which accounts for seven per cent of all managers within the company. The company implemented Holacracy, an organisational structure that eschews manager roles and job titles for self-governing circles.

These circles are then dedicated to specific functions such as HR or recruitment, and consist of sets of responsibilities that are overseen by a ‘lead link’. The ‘lead link’ manages the sets of responsibilities that need to be fulfilled, but does not have the power of a traditional manager; for example, they cannot hire or fire anyone.  

Speaking to Quartz, Zappos Chief of Staff Jamie Naughton, said: “Most of my work is doing my own projects. That’s how it was for a lot of managers. Managing was second to their primary job.” Her new role is “mainly focused on helping scale and drive efficiencies for other members of the General Company Circle.”