Organization development consultant and coach Frederic Laloux coined the phrase “Teal Organizations” as a means of defining an organizational structure that is representative of the next stage of human consciousness. This organizational structure is non-hierarchical in nature and offers a workplace environment in which everyone is empowered with the autonomy and resources necessary to make decisions that are in the best interest of the organization, the individuals who work within the organization (often referred to as members), and the specific area within the business that correlates most directly with his or her area of expertise.
The Teal Organization was born out of this newly emerging human consciousness that has its roots in a profound need to experience dignity and wholeness in all areas of one’s life, including the workplace. In his book, Reinventing Organizations: A Guide to Creating Organizations Inspired by the Next Stage of Human Consciousness, Laloux writes:
Modern organizations have brought about sensational progress for humanity in less than two centuries — the blink of an eye in the overall timeline of our species. None of the recent advances in human history would have been possible without organizations as vehicles for human collaboration. And yet, many people sense that the current way we run organizations has been stretched to its limits. We are increasingly disillusioned by organizational life. For people who toil away at the bottom of the pyramids, surveys consistently report that work is more dread and drudgery, not passion or purpose. … Life at the top of the pyramids isn’t much more fulfilling. Behind the facade and the bravado, the lives of powerful corporate leaders are ones of quiet suffering too. Their frantic activity is often a poor cover up for a deep inner sense of emptiness. The power games, the politics, and the infighting end up taking their toll on everybody. At both the top and bottom, organizations are more often than not playfields for unfulfilling pursuits of our egos, inhospitable to the deeper yearnings of our souls.
Laloux’s overarching thesis is that as humans, we yearn for connection, meaning, and purpose in our work. We have a deep desire to contribute meaningfully and for those contributions to be recognized, honored, and valued. We seek to collaborate and relate with one another from the wholeness of ourselves not merely as coworkers.
As humans have evolved over the course of the last two centuries, so too have organizations. Just as humans have a soul — a spirit that seeks fulfillment and evolutionary purpose — so too do organizations. In essence, organizations are living entities that co-create with its members. Both the organization and the humans within it strive for wholeness and to be understood and experienced in all our complexity. Therefore, the needs of the organization and the needs of the members hold equal consideration and should be equally honored, and equally and simultaneously sought after.
Laloux offers a look at the history of human development and the paradigm for which work was organized and structured within each paradigm. He assigns a color to each stage — hence the term “Teal Organizations.” The following Table portrays a brief overview of each paradigm.
Laloux explains that the “next stage of human evolution corresponds to Maslow’s self-actualizing level; it has been variously labeled authentic, integral, or Teal.” And that, “[T]he shift from Green to Teal is a particularly momentous one in the human journey …” The term “first-tier consciousness” is used to describe the Red through Green stages and “second-tier consciousness” for Teal and stages that may develop beyond Teal. Laloux goes on to explain that, “All ‘first-tier’ stages consider that their worldview is the only valid one, and that all other people are dangerously mistaken. People transition to Teal can accept, for the first time, that there is an evolution in consciousness, that there is a momentum in evolution toward ever more complex and refined ways of dealing with the world.” Teal consciousness accepts that in order to address the challenges that come with the modern world, we must embrace a new way of organizing how we work; how we collaborate; how we relate to and with one another; how we think; how we problem-solve; and how we source our collective knowledge and wisdom.
As noted in the above Table, there are three core breakthroughs of the Teal paradigm. These breakthroughs are fundamental elements of every Teal Organization. They include:
1. Self-Management: Teal Organizations operate without hierarchy or consensus-based decision-making. They have found that the key to operating effectively is within a system of peer-based relationships. Members are empowered to self-manage and are given access to the resources and decision-making power necessary to do so.
2. Wholeness: Teal Organizations have developed a consistent set of practices that invite every person within the organization to reclaim his or her inner wholeness and to bring all of who they are to the workplace. There is no bifurcating of one’s self — the professional self and the personal self. Instead, Teal Organizations desire and expect that individuals show up fully, wholly, and authentically.
3. Evolutionary Purpose: Teal Organizations have a life and a sense of direction of their own. Instead of trying to predict and control the future of the organization, members are all invited to listen in and understand what the organization itself wants to become and what purpose it wants to serve.
These breakthroughs all manifest in a myriad concrete, day-to-day practices within Teal Organizations that depart in big and small ways from traditional Red through Green management practices. And these practices are "baked into" the organizational system design in such a way that fosters positive peace and positive productivity in the workplace.
 “Chapter 1.3 Evolutionary-Teal.” Reinventing Organizations: a Guide to Creating Organizations Inspired by the next Stage of Human Consciousness, by Frédéric Laloux, Nelson Parker, 2014, pp. 43.  Ibid.  “Chapter 2.1 Three Breakthroughs and a Metaphor.” Reinventing Organizations: a Guide to Creating Organizations Inspired by the next Stage of Human Consciousness, by Frédéric Laloux, Nelson Parker, 2014, pp. 56.  “Introduction.” Reinventing Organizations: a Guide to Creating Organizations Inspired by the next Stage of Human Consciousness, by Frédéric Laloux, Nelson Parker, 2014, pp. 3–4.  “Chapter 1.1 Changing Paradigms.” Reinventing Organizations: a Guide to Creating Organizations Inspired by the next Stage of Human Consciousness, by Frédéric Laloux, Nelson Parker, 2014, pp. 36.