4/7 – 2nd Tier Teal Organizations: Magic, Myth or Evolutionary Step?

Leadership Emerging / April - June 2015

download“[E]very time humanity has shifted to a new stage, it has invented a new way to collaborate, a new organizational model” (Laloux, 2014, Kindle Locations 385-386).

Eric Reynolds at Faceboook photo

Eric Reynolds

The above quote is the premise of Frederic Laloux’s Reinventing Organizations. As he points out in the book, data in this area is as yet pretty slim. That being said, Laloux presents case studies on 12 different companies across various economic sectors that paint a pretty clear picture. Organizations founded on a clear overriding purpose and which forgo traditional hierarchies are able to distribute power and tap into collective intelligence and creativity in remarkable ways, leading to market share, as well as the creation of entirely new markets. In terms of Integral Theory, these could be thought of as 2nd Tier (Teal) organizations.

Teal organizations don’t just create better products or provide better services or nicer places to work, they become stewards of economic niches, guiding the economic landscape much as a permaculture farmer tends to the ecology of the farm. Like a good realtor looking for the best use of a property, these organizations are looking for the best way to add value across all relationships (Sanford). The entire economic landscape is in need of stewardship, which makes for much economic potential. All businesses don’t need to be fully developed in teal any more than all the people in an organization do. In fact, it is likely that a relatively small but stable percentage of such organizations, with healthy regulation (Dawlabani), could create conditions such that the soil of our economy becomes more fertile overtime.

A 2nd Tier business model is not a panacea; simply introducing a structure as the newest change fad is not what this book is about. As Laloux notes, there is seemingly a paradox at work. For distributed power and shared leadership to work, strong leadership at the top is required to resist taking control when things get shaky. A great deal of integrity both to the mission of the organization and to the soul of the enterprise are necessary to create hierarchies of actualization in a culture of hierarchies of domination (Eisler). As such, most companies wishing to simply adopt 2nd Tier practices in order to reap the benefits will likely not weather the transition. In other words, teal organizations are leading not by example of what they do (though this is important), but by who they are.

Much has to do with perception. In 1970 Clare Graves wrote that “only when, we have more knowledge of these adult behavioral systems and their hierarchical relationship to one another will we be able to more adequately describe, understand, predict and manage the behavior of the adult individual, the operation of an organization, or the development of society” (Cowan & Todorovic, 2005, 1-2). “

As Laloux says, “[P]erhaps the times are catching up… perhaps we are now finally ready to see them for what they are: not merely as friendly but awkward outliers, but as pioneers of our collective future” (2014, Kindle Locations 418-419). A lot has to do with what we think of them. Indeed, “every time that we, as a species, have changed the way we think about the world, we have come up with more powerful types of organizations” (Kindle Locations 483-484).There is no myth and no magic here, simply attention to the way we think.


Beck, D., & Cohen, C. (1996). Spiral dynamics: Mastering  values, leadership, and change. Bodmin, Cornwall: Blackwell Publishing.

Cowan, C. & Todorovic, N. (Eds.). (2005). The Never Ending Quest: Dr. Clare W. Graves Explores Human Nature, by Clare W. Graves. Santa Barbara, CA: ECLET Publishing

Dawlabani, S. (2013). Memenomics: The Next Generation Economic System. SelectBooks. Kindle Edition.

Eisler, R. (2002). The power of partnership: Seven relationships that will change your life. Novato, CA: New World Library.

Laloux, F. (2014). Reinventing Organizations: A Guide to Creating Organizations Inspired by the Next Stage of Human Consciousness. Nelson Parker. Kindle Edition.

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