When Self-Organization Fails

When some people talk about self-organizing teams, I sometimes get the impression that self-organization is seen as a magic wand that solves all problems. Let’s be honest: self-organization can fail — leading to dysfunction or even self-destruction. Yes, self-organizing systems have an impressive level of resilience to external disruptions. But they also have their weaknesses.

Some examples of failures in self-organizing systems:
An epileptic seizure is a failure in the brain’s self-organization. Cancer is a breakdown in the self-organization of cells. Even markets — often praised for their self-regulating nature — can fail, triggering hyperinflation or banking crises. (Sorry, my neoliberal friend, but Adam Smith was wrong.) In many of these cases, external intervention — by a doctor or a government — can reduce the impact of failure and help the system “heal” or at least slow its collapse.

So where are the limits of self-organization in teams?
Human self-organization relies on open communication and a baseline of trust. If communication breaks down — for example, in remote environments where communication is neglected — self-organization collapses. If you introduce a psychopath or pathological narcissist into a team, they can completely erode trust and collaboration. These situations have the potential to turn a team into a dysfunctional group.

Even well-functioning, self-organizing teams sometimes struggle to make certain decisions — especially when personal goals conflict with organizational interests.

We often encounter this in discussions about team structure at scale:
High-performing teams are more than boxes on an org chart — they’re social homes for their members. Teams will defend that home fiercely, no matter how compelling your Excel models may be.

Another example: changes to compensation models.
The tension between individual finances and the “greater good” can be too strong for a team to resolve without falling apart.

Of course, one could take the mindset of, “Whatever happens is the only thing that could have happened,” and let the team fall apart. That’s what happens in fully self-organized human relationships — like friendships. But in organizations, teams don’t exist for their own sake — they exist to fulfill a purpose. If they can no longer do that, they are dysfunctional.

As a leader, you must recognize when a team’s self-organization begins to fail. And you must intervene — just like a doctor intervenes when the body’s self-healing abilities are no longer enough. To choose the right intervention, you need a solid understanding of how self-organization works — and where the root problem lies. Just as a doctor needs to understand the human body before treating illness.

And just like a doctor can choose between mild treatment or a major, risky surgery, you also have choices between gentle or drastic interventions.
Mild measures may include bringing people together or organizing external support. Harsh measures might mean overruling the team or letting someone go. And as with surgery, tough interventions require aftercare and recovery time. If you “operate” every week, the team won’t survive.

My personal benchmark for timing is this:
If people say afterward, “Why did you wait so long?” — then the timing was probably right.

Only resort to drastic actions after all softer approaches have failed.