16
November
2009

On organizational hierarchy, flat organizations, and purpose 23:40 on Monday

The flatness of an organization is proportional to the required level of shared purpose.

In a hierarchical organization orders come from above. The purpose of the organization is known and kept at the top. This is desirable, because knowledge is power. It doesn’t matter if those ranking low in the hierarchy do not share the purpose, because the worker bees are there only to do what they’re told.

The less hierarchical, and the more flat an organization wants to be, the more important it is that everyone in the organization shares the purpose of the organization, its reason for existence, its direction and its goals. A shared purpose allows the organization to work without the burden of hierarchy, as knowledgeable workers are trusted and empowered to make the small daily decisions that are needed for the organization to run efficiently.

Shared purpose is rare. Without shared purpose a flattened organization could become busy and without direction, or stagnated and without motivation. But for sure the organization will become inefficient. The inefficiency and lack of focus will cause the organization to splinter, effectively shifting the power back to the management, but — this is important — while at the same time reducing organizational transparency. In a hierarchical organization you always know which way is up, and from where the orders are coming in. In a flattened and splintered organization visibility is clouded and the direction of orders is not clear. This allows for far more intricate and sinister power games and organizational politics.

I still believe the flattening of organizations is the future, but it requires a real increase in shared purpose and empowerment. To create more value from the organization, and to reduce hierarchy for real, a strong sense of purpose needs to be instilled in the organization first, before reducing hierarchy.

Inspired by Sig’s post, E 2.0 – not joining the debate, but….

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