Adhocracy Culture: A Full Guide for HR Professionals

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Adhocracy Culture: A Full Guide for HR Professionals

Strategic innovation is a key source of competitive advantage and differentiation for many organizations now. Adhocracy culture helps organizations become innovative and adaptable, which is imperative in today’s increasingly dynamic marketplace.

Let’s have a look at the characteristics of adhocracy in a business context, its advantages and disadvantages, examples of adhocracy culture within organizations, and how HR professionals can help foster adhocracy culture.

Contents
What is adhocracy culture?
Key characteristics of adhocracy culture
Advantages of adhocracy culture
Disadvantages of adhocracy culture
Adhocracy culture examples
How HR can help foster adhocracy culture

What is adhocracy culture?

In a business setting, adhocracy culture describes a corporate approach of decentralized leadership, individual initiative, and organic decision-making. It doesn’t rely on a rigid system of authority or procedures. Instead, it focuses on consistently adapting methods by giving employees who are closest to the action permission to do their work and solve problems as they see fit. 

The term adhocracy became popular in the 1970s as a contrasting alternative to bureaucracy, which is structured by rules and hierarchy. It is derived from the Latin phrase ‘ad hoc’, which means ‘for this (purpose)’.

Adhocracy is one of the four types of organizational culture identified in the Competing Values Framework as follows:

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  • Adhocracy culture (Create)
  • Clan culture (Collaborate)
  • Hierarchy culture (Control)
  • Market culture (Compete)

Most organizations will take on more than one type of culture, but typically there is a particular prevailing corporate culture that represents the overall environment.

Fostering the type of company culture that fits your business and goals will help you improve organizational performance and ultimately positively impact the bottom line.

Adhocracy Culture

Key characteristics of adhocracy culture

Organizations with an adhocracy culture create a participative and flexible work environment for their employees. 

Some of the common features of this type of structure include:

  • Less emphasis on official authority, more emphasis on individual initiative. Corporate levels are not strictly defined, and there is a shared leadership mentality. Instead of having just one role to play, employees can step in and lead projects suited to their skills. They are welcome to self-organize and experiment with different ways to handle problems and accomplish tasks without a supervisor’s permission. 
  • A focus on innovation and risk-taking. It’s acceptable to question the way things are done and make changes. Employees have the freedom to be creative and try out their ideas. This experimentation stimulates new methods, products, and services and promotes continuous innovation.
  • An informal atmosphere. There is little formalization regarding behavioral expectations, procedures, and roles. Employees have more power to decide when they work and how the job gets done. Adhocracies will often hire freelance workers regularly for specific projects. 
  • A highly organic structure. Less importance is placed on approved procedures or planning ahead. Decisions are made more reactively than proactively, and projects can be rerouted at a moment’s notice. There is an emphasis on urgency, so team members can collaborate and take action without waiting for authorization. 
  • Flexibility is valued and practiced. The goal is an adaptive mindset with the ability to switch gears quickly. Internal resources must be prepared for the ever-changing business climate. Specialized teams are swiftly formed to face whatever challenges may come up.

Advantages of adhocracy culture

An adhocracy culture can be more appealing to certain companies than traditional organizational cultural models. It works well in industries where unpredictability is expected, as products can be regularly upgraded or replaced with cutting-edge technology. This type of culture can also exist on a smaller scale within specific business units.

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Here’s an overview of the advantages adhocracy culture offers:

Quick decision-makingDue to the risk-taking focus and low hierarchy, decisions are made speedily when there isn’t time for lengthy analysis. People can operate on instinct without needing several levels of approval. This means you can meet customers’ immediate needs and market demands when circumstances shift at a rapid pace. 
AdaptabilityThe focus is on the future and out-of-the-box thinking to be one step ahead of competitors. It’s possible to branch out or make adjustments to your strategy on the go based on changes in internal and external conditions.

Since employees aren’t categorized into just one function, they have varied skills and knowledge to step into different activities where they are needed. 
Encouraging innovative behavior and creativityThe lack of hierarchy makes it easier to interact, collaborate, and socialize with colleagues. People feel more comfortable speaking up with their opinions and ideas to experiment and bring forth solutions.
Empowering the workforceWithout the confines of a formal structure, employees see themselves as having more control over their careers. The work being done throughout the organization is more visible, so employees are aware of new opportunities and feel free to change their roles.

Disadvantages of adhocracy culture

Adhocracy culture doesn’t suit every type of business. The lack of designed processes and prescribed procedures won’t work for industries that are required to follow strict protocols. It’s important to consider if this approach might limit your organization. 

Here’s a breakdown of some of the drawbacks and limitations:

Communication can failBecause there is little structure on how things are done and a lot of emphasis on individual initiatives, there can be confusion. Employees may not fully understand where they should get and direct important information or know who is responsible for handling certain situations.

Adhocracies need to find effective communication methods. Otherwise, it leads to people missing things, duplicating work, delays, etc.
A disorderly work environmentUnpredictability may kindle creativity, but people can sometimes feel a bit lost in a constantly changing setting.

Without a set chain of leadership, employees might not fully understand all their responsibilities or how well they’re performing. It can also be unclear who to go to for guidance on duties or interpersonal conflicts.

Not everyone works at their highest level without structure. A more laid-back attitude about processes and work hours can impact timelines and quality control.
Not every idea will work outRisk-taking doesn’t always lead to success. It’s normal to have failures, so an organization must be able to tolerate this. Spontaneous decision-making that omits market research or risk management can end up squandering money on something that doesn’t pan out.

A lack of planning for possible problems puts you in a reactionary mode. On the other hand, having mitigation measures or solutions on hand prepares you for issues that may arise.  
Recruitment might be a challengeAn adhocracy is not the right environment for everyone. People who crave stability, procedures, and routine are not strong candidates, which can narrow down your recruitment options.

Also, it is a setting more suitable for experienced individuals rather than people at the beginning of their careers. Fast-paced conditions demand employees with honed techniques who don’t need much supervision. Leaders need to have a great deal of confidence that their team members will be able to handle whatever comes at them.

Adhocracy culture examples

Many companies you are probably familiar with have embraced certain features of adhocracy culture. Here’s a look at a few of them:

Apple

This technology giant has a collaborative structure organized by areas of expertise instead of product type. People with specialized duties on various teams work on every product. Each division of the company has the autonomy to perform in whatever way they see fit. 

Google

Employees of this search engine and technology business have flexible work hours to both get their work done and innovate. It is recommended that they devote 10% of their time to exploring new ideas, whether or not they pertain to a currently assigned project. 

Employees are encouraged to participate in the decision-making process with direct access to leaders. There is also has a team mentality when it comes to management. Its “Googler to Googler” program inspires employees to coach one another.

Spotify

The way this audio streaming service company functions has become a model for other organizations. Instead of having a predetermined organizational structure, Spotify decentralizes decision-making for how work gets done. 

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Small, cross-functional teams called Squads handle every feature of the business. Each squad has its own mission and the freedom to complete work creatively in the manner its members find most effective. 

Tesla

The electric automobile manufacturer has a fairly flat configuration of managers and subordinates, and employees are encouraged to think like owners of the company. There is limited or flexible structure in certain areas without much bureaucracy and politics.

CEO Elon Musk has emphasized that employees do not need permission to approach people at any level of the organization with ideas that will benefit the company. Employees feel comfortable interacting with others of all ranks and outside of their departments on how to solve problems.  

How HR can help foster adhocracy culture

Whether your organization is a true adhocracy or adopts just some of its principles to promote innovation and individual initiative, HR can have a positive impact. 

Consider the following practices to help cultivate an effective adhocracy culture:

1. Adapt the model

Get a good grasp on the mindset and practices of an adhocracy but know that it isn’t one-size-fits-all. For example, you might choose to cultivate certain principles like promoting quick decision-making, or select only certain teams to adopt elements of adhocracy.

You shouldn’t replicate exactly what another company does. Put your own spin on it, and it may take several attempts to get it right. 

Leveraging the adhocracy model to suit your organization’s needs and environment is how to meet the goal of changing your company culture for the better.

2. Promote cross-functional collaboration

If your organization has multiple siloed departments, it is essential to support collaboration across different functions. Develop forums where information can flow, such as cross-team projects, brainstorming sessions, dedicated communication channels, etc.

Purposely bringing people together to share new ideas and deliberate problems creates an environment where spontaneous knowledge sharing will naturally occur when challenges arise.

3. Hire and retain the right people

It’s important to attract candidates that will thrive in your particular type of culture. Job applicants need to be aware of what it will be like, so be sure that your company culture is displayed clearly in recruiting materials. 

Whoever is doing the hiring must be well-informed about what to look for, and job descriptions should outline these specific qualities. You want to target people with a history of innovative behavior who are self-guided, flexible, and collaborative.

4. Encourage and reward desired behaviors

Define behaviors you want to see more of in the organization, and then encourage and reward these. This includes support for learning from disappointments as well as achievements.

For example, publicly celebrate decisive actions and experiments, even if they weren’t super successful. Employees will take on this innovative mindset for themselves and support it in their peers.

In closing

In a fast-moving environment, mixing in a less rigid management approach can be the way to go. Adhocracy culture empowers employees to contribute and equips organizations with the flexibility they need to succeed.

Fostering aspects of adhocracy that make sense for your organization will help you reap the benefits of this type of organizational culture.

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