A new “flat organization” trend is being adopted by more and more companies, predominantly in IT. This new delayered structure removes the majority or even all of the middle management. The flat organization only has staff and top executives. The staff manages itself so that it’s much more involved in decision-making.
The idea is to make the organization much more agile, mobile and responsive to feedback. There are no longer pointy-haired boss playing corporate politics. Middle management roles, e.g. supervising, are distributed between the members of the team.
What companies have already adopted this organization structure?
Valve, the famous video games developer US company, is probably the biggest name in the flat organization trend. Valve employees are free to choose what they work on and they even form and dissolve temporary teams based on product needs.
Such is the mobility of Valve employees, that they are issued mobile desks fitted with wheels. An employee can move his desk around the office when the time comes to join a new team. Valve’s company handbook, leaked to the net in 2012, even features desk moving instructions.
Valve manages to release quality products, like their renowned Portal and Half-Life games, and Steam online store, without a traditional management process. Experts attribute this to the high quality of employees and the system where workers decide each other’s pay based on skills and performance.
Github is a San Francisco-based source code hosting service with fantastic collaboration features. This start-up has originally adopted flat organization structure, where “everyone is a manager”. Employees choose to work on projects that interest them on an open allocation basis.
Since Github is a provider of a software collaboration platform, it’s only natural for the company to work on an open collaboration basis.
After a harassment scandal in 2014, Github introduced middle level management.
Gore, a US based hi-tech materials company, famous for the Gore-tex fabric, is a 8500 employees juggernaut without an organizational chart. The company is structured into business units, but there is no hierarchy and no bosses.
Bill Gore, the founder, believed that peer pressure and desire to create great products would hold the company together better than traditional hierarchical management.
So far he has been proven absolutely right.
Zappos is probably the biggest online shoes retailer. It was acquired by Amazon in 2009 for $940 million.
Tony Hsieh, the CEO of Zappos, emphasizes how Zappos’ organizational structure is a Holacracy, a term derived from the Greek “holon” – a whole that’s part of a greater whole. The company is made up of different circles and employees can belong to multiple circles, possibly having different roles in each. There are no job titles or managers and it allows greater, even radical, transparency and better adaptability.
The holacracy structure is supposed to correspond better to the actual cloud of interconnections than the traditional org chart with its linear structure.
Balsamiq is a California based maker of wireframing (UI design) tools. According to their jobs page,
“we don’t have managers and standard job titles – there are limited career paths here… you will have a lot of choice about what to work on”.
Employees can start their own projects and project roles are assigned according to relevant skill-sets.
This flat organization helped the company create the most popular wireframing tool, Balsamiq Mockups.
Is Flat Management Here To Stay?
Flat organization is an interesting trend for a generation that doesn’t immediately respect authority or hierarchy, but only merit. It can help decrease bureaucracy and pointless paper pushing, but it can also introduce some confusion to large organizations as described by this Dilbert cartoon.
It remains to be seen, if flat, hierarchy-lacking organizational structure can prevail in the corporate world. Or rather, how much of its substance can flat management preserve as it gets adopted by more and more companies. Corporations are notorious for adopting trendy buzzwords without changing their core processes.
But there is no doubt, that generation change will also bring us a change in management and organization methods, of which flat management is one example.