Decentralized Success: The Target Teal Model
The RenDanHeYi model, developed by Haier Group CEO Zhang Ruimin in 2005, is revolutionary management philosophy aimed at transforming traditional hierarchical corporate structures into highly adaptive, customer-centric ecosystems. Rooted in the belief that employees (Ren) and their entrepreneurial capabilities should align with customer needs (Dan) to create value, the model emphasizes individual accountability and dynamic organizational roles (HeYi). By dismantling conventional silos, the RenDanHeYi model fosters a network of autonomous micro-enterprises within the larger corporate entity, transforming the organization into a nimble startup factory.
To develop and share the idea of Zero Distance and its broader management philosophy of RenDanHeYi, Haier hosts an annual forum to celebrate the world's most progressive organizations. This September marks the 8th edition of the forum, taking place in Haier’s hometown, Qingdao, on September 20. Working with the Business Ecosystem Alliance and the Management Lab, the Haier Model Institute will release the inaugural listing of the progressive companies which are putting Zero Distance and related ideas into practice.
These organizations are characterized by:
Zero Distance to customer | Decision what to build is based on insights from the marketplace
Autonomy | Small teams with full decision-making autonomy enable speed in execution
Shared Rewards | Everyone in the micro-enterprise participates in its financial success
For the 2024 inaugural ZeroDX awards, Haier approached us to list 50 self-managed organizations that showcase the principles of RenDanHeYi in how they organise their work. Target Teal is one of the 50 organisations we listed this year.
Introducing Target Teal
Target Teal stands out in the field of organizational design consultancy, redefining traditional business structures through its unique approach to self-management, decentralized decision-making, and collaborative work culture.
At its core, Target Teal aims to transform how organizations function by promoting evolutionary social systems, self-management, and a healthy organizational culture. Their principles are deeply rooted in autonomy, radical transparency, and shared ownership. By operating as a collective of 10 interdependent consultants and facilitators, Target Teal emphasizes the power of collaborative work and shared purpose.
Target Teals is a prime example of RenDanHeYi in the management consultancy industry. They fully walk their talk by decentralizing decision-making, organizing fluidly around customer needs, committing to radical transparency in their operations and sharing the value created in their work. In addition they are constantly reinventing the tools they provide to clients on their own road to self-management - the latest being an AI assistant that guides their clients in their journey with the O2 model.
Organizational Structure
Target Teal operates as an unincorporated joint venture, where each facilitator is an autonomous entrepreneur running their own company. This structure eliminates traditional hierarchies and allows for a high degree of decentralization. Key aspects of their organization include:
No Owners, Bosses, or Employees: Target Teal has no central ownership or hierarchical positions. All members are equal partners, each contributing to the collective without the constraints of traditional job titles or roles.
Role and Circle-Based Structure: The organization is structured around roles and circles rather than hierarchical positions. This means that work is organized based on functions and responsibilities and it adapts constantly as you can see here in this presentation.
Decision-Making Through O2 Social Technology: Decisions and asset management are facilitated through the O2 (Organic Organization) social technology. This method ensures that all voices are heard and that decisions are made collaboratively.
Approach to clients
Target Teal's approach to client interaction and project management is built on the principles of self-management and autonomy. Each consultant within the collective has the freedom to generate their own income through individual projects and partnerships. This model empowers consultants to take ownership of their work and directly engage with clients, fostering stronger, more personalized relationships.
Target Teal is not just about consultancy; they are also educators and thought leaders in the field of organizational design. Their offerings include:
Courses and Workshops: Target Teal offers courses that disseminate their knowledge and methodologies to other consultants and organizations. These courses cover topics such as self-management, organizational culture, and the O2 social technology (which has been described in more detail below)
Model Book and Open Source Meta-Agreements: They provide resources like the "Model Book" and open-source meta-agreements, making their practices and principles accessible to a broader audience.
AI Assistants trained in the O2 model, that help people self-learn and navigate the model and their specific organizational challenges.
Public Drive: Target Teal maintains a public drive where they share their content, further promoting transparency and knowledge sharing.
This radical transparency related to all their resources and know-how is another testament to the partnership approach of Target Teal embedded across all their work and stakeholder relationships.
About O2 Method
While O2 can facilitate a full transition to self-management, its real strength lies in its versatility. It provides a rich set of tools and concepts that can be applied selectively to address specific organizational needs, making it a valuable resource for a wide range of clients with diverse challenges and objectives.
Flexible Application: While O2 is designed as a catalyst for self-management, its components can be selectively applied to address specific organizational issues without necessarily implementing the entire system of Roles, Circles and Meetings.
Library of Patterns: O2 includes a constantly evolving library of design patterns. This library serves as a repository of solutions that organizations can draw from to address particular challenges they face.
Diverse Influences: O2 is built upon various management and organizational theories, including Holacracy, Sociocracy 3.0, Agile Software Development, Getting Things Done, and others. This diverse foundation makes it applicable to a wide range of organizational contexts and problems.
Solving Challenging Issues: For clients facing specific organizational challenges, anyone can leverage O2's concepts to provide targeted solutions. This might involve implementing certain meeting practices, decision-making processes, or role-definition techniques without overhauling the entire organizational structure.
Less complicated and broader focus than Holacracy. O2 recognizes and proposes strategies for both organizational and interpersonal or relational spaces while maintaining a simpler and straightforward language.
This makes O2 particularly suitable for organizations looking for a more customizable and less rigid path towards improved organizational practices or full self-management.
Internal Culture
The culture at Target Teal is one of openness, trust, and mutual support. The absence of a traditional hierarchy means that every member's voice is valued, and decisions are made collectively. This fosters an environment where creativity and innovation can thrive, as consultants feel empowered to explore new ideas and approaches. The use of the O2 social technology further enhances this culture by ensuring that all decisions are made with input from everyone involved, promoting a sense of ownership and accountability.
All members are accountable for their results, and the organization practices radical transparency. Key practices include:
Transparent Information Sharing: All information about projects and contracts is openly shared among members. This transparency fosters trust and collective responsibility.
Internal Banking System: Target Teal uses an innovative internal tool that functions as a bank. This system collects taxes from consultants and provides a means to circulate money within the collective. A special fund, created from 15% of every invoice, is used to pay partners working in supporting roles.
Revenue Sharing through the Money Pile Method: Revenue from courses offered by Target Teal is shared using the "Money Pile" method as well as more than 50% of consultancy projects are shared thi way. In this method not only effort and value added by each partner is compensated but also the personal financial situation is taken into account by all involved.
Target Teal is a distributed organization with no physical office or specific address. This distributed nature allows them to operate flexibly and adaptively, drawing on a diverse range of perspectives and expertise from their ten partners. Each partner operates their own independent “fiscal” company, contributing to the collective's goals and vision.
Conclusion
Target Teal exemplifies a forward-thinking approach to organizational design, challenging traditional business structures and promoting a model based on autonomy, radical transparency, and collective success - all of these in line with the RenDanHeYi management philosophy. Through their commitment to these principles, Target Teal not only delivers exceptional consultancy services but also pioneers a new paradigm for organizational success.
