Sociocracy is a very thorough form of decision making, it goes through several stages (circles) and is sometimes hard to bear because you need a lot of patience and time for it.
Nonetheless, with the help of experienced mediators, it is the best and most democratic way and also very enduring. One community, Steyerberg used it for example to find the most accepted and optimal board for their group

 
Here is a good 4 minutes explanation of the general concept:

Source: http://www.sociocracyforall.org/
 

Sociocracy is an organizational form with which organizations of various sizes – from family, through companies and NGOs to the state – can consistently implement self-organization. In its modern version, it is based on insights from system theory. Their main objective is the guarantee of a minimum level of social security because structural ignorance of needs is avoided. The members of an organization develop joint responsibility for collective intelligence both for the success of the organization as a whole as for each individual.

Sociocracy is derived from the Latin and ancient Greek words socius ‘companion’ and kratein ‘govern’. The French philosopher Auguste Comte, who also created the term sociology, gave distinction to the term sociocracy in 1851. Later it was used by the American sociologist Lester Frank Ward in a paper, which he wrote for the Penn Monthly 1881.

In the middle of the 20th century, reformist Kees Boeke updated Ward’s ideas and extended them considerably. Boeke regarded sociocracy as a form of government or management, based on an equality of individuals and based on the principle of consent. In contrast to democracy, this equality is not embodied by the principle of “one man – one voice”, but by the principle that a decision can only be made if no one of the present has a serious and justified objection to it.

Sociocracy gives the majority in group decision-making processes less power and the individual more power than democracy. Therefore, it was seen by its founders as the next step towards democracy. The necessity of a consensus would make them vulnerable to political paralysis (except in small, homogenous groups): A man can block any decision with a determined and justified objection. To reduce this problem, it is not asked whether everyone agrees, but whether someone is against it (which creates a mental obstacle). In some forms of sociocracy, a mere refusal of the application is not sufficient, but a valid argument must be made. Sociocracy is therefore not based on the consensus principle but on the principle of consent, which means that not all participants have to agree.

To apply sociocracy in larger groups, a system of delegation is needed in which the group selects representatives who make decisions at a higher level for them. Kees Boeke introduced the terms naasthoger and naastlager. Naast (Dutch for ‘next’) refers to the fact that a higher level is not higher than a lower level. The decision-making body of a “next higher” level must not impose its policies on a “more sublime” level in a sococratic organization.

Gerard Endenburg
In 1970, Gerard Endenburg transferred the work of his teacher Boekes to the electrotechnical company, which he had taken over two years earlier from his parents. The Sociocratic Circle Organization Method (Sociocratic Kringorganisatiemethode) (Sociocratic Circle Organization Method) was established, which helped overcome a business crisis in 1976 and gained worldwide attention.

According to Endenburg, there are four basic principles in the sociocracy:

1. The consensus governs the decision-making process, the consensus principle.
2. The organization is set up in circles that autonomously make their basic decisions
   within their borders.
3. There is a double link between the circles, in which at least two persons participate in both sessions: a functional leader and at least one delegate.
4. The circles elect people for the functions and tasks deemed necessary for the realization
   of the common goal in the consensus after open discussion.

Problems of Sociocracy as a Moderation Method
The sociocracy wants to get along without votes, it should count arguments and not heads. Each member of the circle can slow down the decision making by a serious objection. Everyone decides individually whether it is a “serious” objection with regard to the common goal. However, the objection is always an argument, which is behind the grave objection. With the help of this argument, a new solution is found in the group which also takes this argument into account. This decision-making takes more time and a competent moderation. that require a terminated decision, if no solution is found in a circle the topic is delegated to the next higher circle.

(Sources: Wikipedia, partizipation.at)