Take a minute to draw a diagram representing the structure of management within your company, be it a real company that you own or work for, or a company that you envisage running. Go ahead, I’ll wait here – it should only take a minute. I’m going to hazard a wild guess and say that your diagram is somewhat triangular in shape. You are at the top, one person with the ultimate power to make decisions and ultimate responsibility for coming up with ideas to drive the company forward. Depending on the size of your company, below you there is likely a vice chairperson and a financial controller, followed by a layer of department heads, team leaders and at the bottom the entry level staff. The population of employees at each level is probably significantly larger than at the level above it. This is, the hierarchical structure of management, taught as an effective model in business schools and exemplified by large corporations across the globe. This structure is deeply flawed as a model for companies existing in the modern world of business.
It hinders collaboration:
In today’s world, innovation is everything. New ideas need to be continually generated and the best way to ensure this happens is to maximise collaboration and communication between individuals, teams, departments, managers and executives. The segregation and strict channels of communication inherent in the hierarchical structure pose an obstacle to such collaboration.
It’s too slow:
The hierarchical structure generally involves a great deal of bureaucracy and red tape. If an individual working within a department has an idea for change, they take it to their team leader. It is then passed through each level of the hierarchy, often not moving higher until monthly or bi-monthly meetings take place or appointments can be scheduled. By the time the idea reaches the top of the chain where decision making power resides, it is often too late for it to be effective.
It is limiting:
Each person in a hierarchical structure has a defined role and responsibilities. They come to work to do a job and fulfil a function the way they are told to. If something comes up that is out of their remit – it is simply passed to another department to deal with. Creative solutions to problems are thus rarely found.
Great modern leaders, know that a far more effective structure is one in which opens communication channels directly to the top, allow employees to re-define their roles and collaborate freely, imbues employees with a high level of trust and responsibility, and encourages the sharing of ideas.
by Can Akdeniz [Best Business Books]