Frédéric Laloux

Frédéric Laloux is a Belgian author and former McKinsey consultant, known for Reinventing Organizations, a book he published in 2014. In it he describes companies that run without a management hierarchy, which he calls teal organizations, and he places them at the latest stage of a history of how humans have organized work.

The stages and the colors

Laloux gives each organizational model a color. Red organizations rest on the power of a chief, amber ones on rank and fixed procedures, orange ones, the model of most large companies, on performance and targets. Green ones put culture and employee involvement first. Teal is the stage he studies. Laloux builds this sequence on developmental psychology and on the integral theory of the American philosopher Ken Wilber.

The three breakthroughs of teal organizations

Laloux studied twelve organizations in depth, among them Buurtzorg, a Dutch home care provider whose nurses work in small autonomous teams, FAVI, a French foundry, and Morning Star, a Californian tomato processor. He draws three shared features from them. Self-management replaces the pyramid with teams that make their own decisions. Wholeness lets people bring their whole self to work instead of hiding behind a professional mask. Evolutionary purpose means listening to where the organization's purpose is heading and adjusting to it, instead of following a fixed strategic plan.

Limits of the model

Laloux himself points out that these practices depend on the people at the top. When a new CEO or new owners do not share the approach, they can dismantle it quickly, as happened at AES, an American energy company he studied, after its CEO resigned. Outside his case studies, many companies find these practices hard to bring into their day-to-day operations.