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Dynamic Governance: Where Cybernetics Meets Sociology

By Rebekah Devine

Imagine a governance system where everyone’s individual voice is considered and decisions are determined by consent. Sound like a utopian fantasy? It’s not. Dynamic governance, also known as sociocracy, has a track record of real world implementation and has proved effective in organizations of up to 1,800 people. Case studies of sociocracy applied around the globe range from the transformation of a small eldercare facility in Vermont to the improvement of the Netherland’s largest mental health treatment center. The question for us at Blockchains LLC is: Can we apply sociocratic methods to governance of a DCE?

What is dynamic governance and how did it develop? French philosopher and sociologist Auguste Comte first coined the term “sociocracy” in the early 1800s to denote rule by the “socios,” people who have a social relationship with one another. The idea was later popularized in the late 19th century by American sociologist Frank Ward, but at that time lacked concrete structure. The structural mechanics of sociocracy came later, built on the work of 20th century scientists: Norbert Wiener, founder of cybernetics; mathematician John Forbes Nash; and Nobel laureate Ilya Prigogine, who did groundbreaking work in self-organizing systems and how order arises from chaos.

Before any of these scientists were established in their fields, however, a Quaker progressive couple, Betty Cadbury and Kees Boeke, were hard at work developing the principles of sociocracy at the school they founded in Bilthoven, Netherlands, in 1926. Cadbury and Boeke took Comte’s ideas and applied them to the learning environment at Werkplaats Kindergemeenschap (the Children’s Community Workshop), so named because they wanted the students to think of themselves as workers whose job was to learn.

When you envision a children’s school attempting to incorporate every person’s voice and govern by consent, you might well imagine a rosy ideal quickly devolving into the brutal chaos of Lord of the Flies. But within twenty years, the Workshop, which still operates today, had grown to 400 students, staff, and teachers, who all participated in regular decision-making meetings where no action was taken until every member consented to a decision.

The formal iteration of the sociocratic method as it is used today in businesses, schools, and organizations was developed in the 1970s by Gerard Endenburg, a student at the Workshop who later become an applied cyberneticist and electrical engineer. Endenburg began to see problems with traditional governance approaches when he inherited his family’s manufacturing firm, Endenburg Electrotechniek. But Endenburg also realized that the social sciences did not offer clear management concepts, so he used analogies from electronic and biological processes to create the three primary components of dynamic governance and implement them at Endenburg Electrotechniek.

Principles of Dynamic Governance

The main principles of dynamic governance are known as consent, circles, and double-linking. In contrast to consensus, where everyone must agree on a decision, consent is reached when there are no remaining paramount objections. When a policy change is proposed, any objections are discussed, and if needed the proposal is revised. Giving consent does not mean the proposed decision is each member’s ideal, but rather that that they can live with the outcome and see no substantial reason why the group should not proceed.

A sociocratic organization is comprised of multiple tiered, overlapping circles. A circle is a semi-independent team of individuals responsible for governing its domain according to the entity’s principles. This is the horizontal element, where everyone in the circle is a full member with equal say. But there’s also a vertical element: Each circle functions on a different level. For example, you might have staff members on level 1 of the hierarchy, managers on level 2, and a CEO and board on level 3.

Example: Tiered Sociocratic Circles graph2

This is where the principle of double-linking becomes important. Each circle has an elected operation leader who is also a full member of the circle above it. The lower circle also elects one of its members to represent its interests to the higher circle (this rep is also a full member of the next level), creating a second link. The result is a feedback loop between circles on differing levels, ensuring that the opinions of each circle (and its members) are communicated.

The double-link feature occurs at every level. For example, the manager circle from level 2 would have a representative that is a member of the board on level 3, and a second board member would also be part of the manager circle on level 2 to represent the board. Philosophically, the goal of the board of directors is to work within the policies of the other circles as opposed to making executive decisions for them. Members of the top circle often include external experts that connect the organization to its environment and provide input. These might be people with experience in law, government, finance, organizational mission, or any field relevant to the operations of the organization.

“The logic of dynamic governance sets aside the either/or logic of workers versus management,” write Buck and Endenburg, “It typically uses both autocratic and egalitarian decision-making. It provides both a security assurance and a creative stimulus.”

While Endenburg originally taught three principles as the primary components of dynamic governance, some methods present a fourth principle (election by consent) as a way to further explain the consent principle. This means that representatives are elected via the consent method by the circle they represent, as opposed to being chosen by other, higher circles in the organization.

Dynamic Governance as a Cultural Shift

It’s important to recognize that dynamic governance is not simply a method for organizing, but a lived philosophical approach to human social ontology. As I read the case studies of organizations that implemented dynamic governance, what struck me was not just the improvement of day-to-day operations, but how individual participants began to see their relationship to the whole differently.

Given responsibilities and stake in decision-making, staff members stepped up to the plate. Managers and people in the higher circles began to view their roles not as primary decision-makers or sources of policy change but as guides to help steer creativity. Dee DeLuca, executive director and co-founder of Living Well Care Home, says giving employees real power to make decisions via dynamic governance has changed their perspective: “When people know they have control over how decisions are made in the place where they work and live, they behave differently.” Similarly, Mondriaan for Mental Health, the Netherlands’ largest mental health treatment center reported:

“Teams now function far more effectively [after implementing dynamic governance]. If a team member makes a mistake, colleagues will guide him or her back on track. This means that everyone takes responsibility to make sure things go well. It also means that employees are more likely to continually learn and improve … More people are using their strengths in their jobs, so their talents are used better.”

Undergirding the sociocratic method is the idea that an entity will thrive and be more profitable when all its members are given ownership and a say. “Endenburg developed these principles and applied them in his company to prove that a business could not only function with workers assuming responsibility for the policy decisions that affected their work, but that it was more profitable to do so.”

As the members of Mondriaan for Mental Health learned, a top-down management style puts key decisions in the hands of a few people who may not be in touch with the wants and needs of the people affected by their decisions. However, giving everyone a voice in decisions will lead to better policies because listening to a diversity of perspectives provides vital information that should be considered in the process:

“Managers, some of whom were initially wary of everyone having input into policy decisions, now understand that people at different levels have different perspectives and that all viewpoints are needed to make the best decisions … People at all levels are [now] involved in patient care decisions, rather than just those in higher management. Discussions about how to care for patients are deeper. Patient care has improved.”

With dynamic governance, everyone can become a creative problem-solver. All the input is leveraged, not just the contributions of “experts” or people further up in the hierarchy. The organization can make the best use of all its human resources instead of relying on the limited vision of a few. As DeLuca opines, “When all voices are equally heard, we achieve solutions that are very creative – better than the top leaders could have devised, however smart they are.”

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