Super-Circles and Sub-Circles in Holacracy: Understanding the Holarchy

Circles in Holacracy don’t exist in isolation. They’re part of a holarchy – a structure in which circles contain other circles and are themselves contained in larger circles. Understanding this relationship is fundamental for navigating a Holacracy organization.

At SI Labs, we’ve experimented with various depths of this nesting over the years. This article explains the concepts and shares our experiences.

The Holarchy: Circles Within Circles

The term “holarchy” (coined by Arthur Koestler) describes a system in which each element is both a whole in itself and part of a larger whole.

The Principle

A circle is autonomous in its area. At the same time, it’s part of a larger circle and contributes to its purpose. This larger circle is in turn part of an even larger circle.

┌─────────────────────────────────────────────────────────┐
│  Anchor Circle (Entire Organization)                    │
│                                                         │
│  ┌─────────────────────┐  ┌─────────────────────────┐  │
│  │  Marketing          │  │  Operations             │  │
│  │  ┌───────────────┐  │  │  ┌─────────────────┐   │  │
│  │  │ Content       │  │  │  │ Product Dev     │   │  │
│  │  └───────────────┘  │  │  │ ┌─────────────┐ │   │  │
│  │  ┌───────────────┐  │  │  │ │ UX Research │ │   │  │
│  │  │ Campaigns     │  │  │  │ └─────────────┘ │   │  │
│  │  └───────────────┘  │  │  └─────────────────┘   │  │
│  └─────────────────────┘  └─────────────────────────┘  │
└─────────────────────────────────────────────────────────┘

Holarchy vs. Hierarchy

Hierarchy	Holarchy
Power flows top-down	Authority lies with the circle itself
Higher levels control lower	Higher levels set context, not control
One boss decides	Governance decides
Information is filtered	Information flows bidirectionally

Research Insight: The holarchy structure enables what researchers call “bounded autonomy” – autonomy within clear boundaries. Each circle is free in its area but embedded in a larger context. [1]

Super-Circle vs. Sub-Circle Defined

The terms are relative – a circle can be both at the same time.

Super-Circle

The super-circle is the circle that contains another circle. It:

• Defines the purpose of the sub-circle
• Assigns the Lead Link of the sub-circle
• Receives the Rep Link of the sub-circle
• Can set domains and policies that also apply to sub-circles

Example: “Operations” is the super-circle of “Product Development.”

Sub-Circle

The sub-circle is the circle contained within another. It:

• Fulfills a purpose that comes from the super-circle
• Has its own governance for its internal structure
• Carries tensions upward through the Rep Link
• Is autonomous in everything not explicitly restricted

Example: “Product Development” is the sub-circle of “Operations.”

The Anchor Circle

The Anchor Circle (the topmost circle). It has no super-circle. It:

• Defines the purpose of the entire organization
• Contains all other circles (directly or indirectly)
• Is the last escalation point for tensions

How Many Levels Make Sense?

The depth of nesting is a design decision.

Factors for the Right Depth

Organization Size

Larger organizations tend to need more levels. An organization with 500 people needs more structure than one with 20.

Work Complexity

Complex, specialized work justifies deeper nesting. Simple, homogeneous work doesn’t.

Coordination Need

When much coordination is needed between areas, flatter structures may make more sense.

Guidelines

Organization Size	Typical Depth
10-30 people	2 levels
30-100 people	2-3 levels
100-500 people	3-4 levels
500+ people	4-5 levels

Too Flat vs. Too Deep

Too flat:

• A circle has 20+ roles
• Governance meetings last hours
• Nobody can oversee everything

Too deep:

• Information must traverse many levels
• Decisions take long
• Coordination between distant circles is difficult

Information Flow Between Levels

Information flows in both directions – this is the essence of double-linking.

Top-Down (via Lead Link)

The Lead Link carries:

• The super-circle’s purpose
• Priorities and strategies
• Relevant policies
• Context for decisions

Important: The Lead Link translates, doesn’t dictate. They make the super-circle’s direction understandable for the sub-circle.

Bottom-Up (via Rep Link)

The Rep Link carries:

• Tensions the sub-circle cannot resolve itself
• Feedback on priorities and strategies
• Information about reality in the sub-circle
• Proposals for governance changes

Important: The Rep Link filters, doesn’t block. Not every small tension belongs upward, but no important one should be suppressed.

The Principle of Minimal Intervention

Information should be processed at the level where it belongs. Tensions only move upward when they:

• Exceed the circle’s boundaries
• Affect resources of other circles
• Require structural changes at a higher level

Autonomy Boundaries Per Level

Every circle is autonomous – but not without limits.

What a Sub-Circle Can Decide Itself

Internal Governance:

• Create and change its own roles
• Set internal policies
• Organize itself

Operational Decisions:

• How work gets done
• Who takes on which projects
• Priorities within the circle

What Comes from the Super-Circle

Purpose: The sub-circle cannot change its own purpose. It comes from the super-circle.

Domains: If the super-circle reserves a domain for itself, the sub-circle cannot act there without permission.

Policies: Policies of the super-circle also apply in sub-circles, unless defined otherwise.

The Subsidiarity Principle

Decisions should be made at the lowest possible level. The super-circle should only regulate what the sub-circle cannot regulate itself.

Research Insight: Successful self-organized systems balance autonomy and alignment. Too much autonomy leads to fragmentation, too little to bureaucracy. The right measure depends on context. [2]

Typical Nesting Patterns

Certain patterns have proven effective in practice.

Functional Nesting

Circles grouped by function: Marketing, Sales, Operations, Finance.

Anchor Circle
├── Marketing
│   ├── Content
│   └── Campaigns
├── Sales
│   ├── Inbound
│   └── Outbound
└── Operations
    ├── Product
    └── Support

Advantage: Clear specialization. Disadvantage: Silos between functions.

Product-Based Nesting

Circles grouped by product or service.

Anchor Circle
├── Product A
│   ├── Development
│   └── Marketing
├── Product B
│   ├── Development
│   └── Marketing
└── Shared Services
    ├── Finance
    └── HR

Advantage: End-to-end responsibility. Disadvantage: Duplications in support functions.

Geographic Nesting

Circles grouped by region.

Anchor Circle
├── DACH
│   ├── Sales DACH
│   └── Delivery DACH
├── UK
│   ├── Sales UK
│   └── Delivery UK
└── Global Services

Advantage: Local autonomy. Disadvantage: Coordination between regions difficult.

Hybrid Models

Most organizations use mixed forms. SI Labs combines functional and product-based nesting.

Super- and Sub-Circles at SI Labs

Our experiences:

What We’ve Learned

Start flat, deepen when needed. We began with two levels and only formed sub-circles when the need was obvious.

Not every area needs a sub-circle. Some function better as roles in the larger circle.

The links are critical. If Lead Link and Rep Link don’t fulfill their function, the connection between levels breaks.

Typical Challenges

• Sub-circles sometimes forget they’re part of a larger whole
• Super-circles sometimes intervene too deeply in sub-circles
• The balance between autonomy and alignment needs constant attention

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Research Methodology

This article is based on the Holacracy Constitution, research on organizational nesting, and over ten years of experience with multi-level Holacracy structures at SI Labs.

Source selection:

• Holacracy Constitution and official materials
• Studies on self-organization and nested systems
• Practitioner experiences from the Holacracy network

Limitations: Our experience comes from an organization with 2-3 levels. In deeper structures, other dynamics may occur.

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Disclosure

SI Labs GmbH has practiced Holacracy for over ten years. We have experimented with various nesting depths.

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Sources

[1] Robertson, Brian J. “Holacracy.” In The Management Shift, edited by Vlatka Hlupic, 145-168. Chichester: Wiley, 2012. DOI: 10.1002/9781119197683.ch9 [Book Chapter | N/A | Citations: N/A | Quality: 60/100]

[2] Bernstein, Ethan, et al. “Beyond the Holacracy Hype: The Overwrought Claims and Actual Promise of the Next Generation of Self-Managed Teams.” Harvard Business Review 94, no. 7/8 (2016): 38-49. [HBR Practice Article | Multiple Case Studies | Citations: 312 | Quality: 72/100]