The way we manage people has undergone seismic change in the last two years giving rise to a valuable opportunity to redefine leadership for better business results, writes Paul O’Donnell.
As we move into the post-pandemic era and employees navigate new hybrid work environments, it’s time for companies to review their leadership and management structures.
The ‘old rules’ of management, characterised by the pyramid structure of top-down hierarchy, are no longer fit-for-purpose. In their place, we’re seeing the emergence of a very different approach characterised by both flexibility and responsiveness.
The flat organisation
The pandemic has created and enabled opportunities for companies to reset, rethink and reinvent how they operate. It is no longer a case of leaders rising to the top. Instead, we need a different kind of leadership — one that extends right across organisations, with fewer management ‘layers’ and greater reliance on cross-functional teams.
This new collaborative culture is how leadership tends to look in what we call a ‘flat’ organisation. A flat organisation is one in which there are few or no levels of management separating the leadership from staff-level employees.
In flat organisations, employees are supervised less while also being actively encouraged to get involved in decision-making.
The idea is to create a more level playing field, allowing the organisation to solve business challenges by leveraging the expertise, talents and passions of the wider workforce.
Benefits vs negatives
There are several positives and some negatives to a flat organisational structure. On the plus side, a flat organisation can:
- elevate the employees’ level and sense of responsibility within the organisation;
- remove excess layers of management and improve the coordination and speed of communication between employees;
- eliminate middle management salaries, cutting costs; and
- nurture innovation by allowing specialists to pursue passion projects that serve the organisation.
On the flipside, however, a flat structure can also:
- lead to confusion and potential power struggles if people are not sure who in the leadership team, is responsible for what;
- produce a lot of generalists, but few or no specialists — the specific role of individual employees may not be apparent;
- limit the long-term growth of an organisation — management may decide against pursuing new opportunities if they believe doing so might unsettle the existing structure; and
- struggle to adapt to change unless the company is divided into smaller, more manageable units.
Creating passion
Research shows that companies must have very clearly defined missions, goals, and growth plans to be successful with a flat structure in the long term.
When these elements are figured out, some experts say employees can find a new passion for work. They may feel more motivated to pursue leadership roles and projects that benefit both their own career and the wider company, giving rise to a more positive work culture.
Whether or not you are a fan of the flat organisation, however, one thing is for certain: returning wholesale to the hierarchical organisational structure of yesteryear is not a good idea.
As transformation and disruptions become the new normal, it is time to start reimagining management.
Paul O’Donnell is the CEO of HRM Search Partners.
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