The organizational structure you choose for your business says a lot about your company and yourself. So it’s important to consider the industry you are in before you start structuring your managerial infrastructure.
But of course, many business organizational structures aren’t chosen; they simply come into form. A lot of times the nature of your business and your clientele will dictate how you structure your staff. And for as far back as most people can remember, tall organizational structures (ones with multiple echelons of management personnel that trickle all the way down to entry-level employees) have dominated the business landscape.
But a new organizational structure is emerging and turning a lot of heads for good reason: flat organizational structure. But what is a flat organizational structure? In essence, a flat organizational structure is any business or corporate staffing structure with little to no middle management tiers. Flat organizational structuring more or less does away with the hierarchical method of layering different degrees of managers on top of one another to oversee different levels of staff. They essentially put as little space between the executives and employees as possible.
What Company Has a Flat Organizational Structure?
Some of the most successful companies in the world employ a flat organizational structure to great success. These companies include:
- General Electric
Of course, with huge multi-national companies like the ones mentioned above, special modifications to the flat organizational structure need to be implemented. But the spirit of the flat organizational structure remains intact to be sure. And one of the driving forces behind flat organizational structures that work is an innovative staff capable of critical thinking and decision making. With fewer management hoops to jump through, a flat organizational structure depends on staff to more or less manage themselves. This comes with a great many advantages…
What are the Benefits of a Flat Organizational Structure?
First and foremost, a flat organizational structure encourages staff to be more independent which has a good amount of side benefits that we will get into shortly. But right off the bat, if you decide to go with a flat organizational structure, you will automatically be considering more qualified staff members, thus upping the value of your workforce.
You aren’t going to want inexperienced staff or employees that exhibit no initiative to man your flat organizational structure. So the quality of your staff becomes the first benefit of a flat organizational structure. Here are more:
1) Project Success
As Forbes points out, a company with a structural hierarchy sees less high-quality projects through to the end. When an important company project needs to be distributed among and filtered through many levels of management, the purpose and aim of the project get distorted. The finished project may not be what the company as a whole had intended at all. Flat organizational structures are more suited for project success because the message of various projects is preserved better among leaders and staff.
2) Company Savings
Middle and upper management types usually command a high salary. But in a flat organizational structure, the upper and middle management staff is minimized which can save the company a tremendous amount of money.
3) Encourages Employee Development
When employees are entrusted with more duties that would typically be reserved for managers in a traditional staff structure, they feel more vested in the company and the company’s success. This encourages employees at all levels to take on more responsibility and increases their value to the organization as a whole.
4) Better Company Culture
In a typical flat organizational structure, when a project is not going right, it gets taken out of the hands of a staff member or team. While this is always discouraging, it breeds a better culture than micro-managing and telling employees what to do, which is what typically occurs in a hierarchical organizational structure. It also allows for coaching opportunities for employees who show and enthusiasm and aptitude for the work.
5) Everyone’s Voice is Heard
Because projects in a flat organizational structure are a team effort, more people’s voices get heard in the decision-making. This makes more staff members feel valued as opposed to thinking that the manager directly above them conveyed their good ideas to the higher-ups without giving them any credit.
6) Creativity and Collaboration
Creativity and collaboration are not only encouraged in a flat organizational structure; they are vital. This kind of culture hones the staff’s ability to effectively communicate with one another and breed creativity naturally – without having to shove it down people’s throats.
7) It’s Progressive
Flat organizational structures are seen as progressive. Companies who use them are more attractive to the massive millennial workforce that is looking to break free from conventions and Draconian corporate structures.
Learn More From DFW BIZ Pros
Running your organization is a challenge. But by empowering your employees to have a voice, you can reap long-lasting rewards. Every company has a different philosophy, but learning the best structure to implement is a major component of success in the year 2020. We hope our list has shed some light on this topic for you. For more resources become a member of DFW Biz Pros.