Fitter, flatter, faster: How unstructuring your organization can unlock massive value
The majority of organizations still use a hierarchical model, where each role is carefully documented and cemented through a system of boxes and lines. In this paradigm, accountability gets buried in the depth of complex organizational structures. With businesses and government agencies alike facing unprecedented disruption, having the flexibility and speed to quickly make decisions and get work done has never been more important.
Digging out from under the many management layers and antiquated hierarchies may seem impossible, but it’s not. Some organizations have successfully “unstructured” to become fitter, flatter, and faster, unlocking massive value. Many organizations are experimenting with dynamic operating models, such as the “helix” model and the agile “network of teams,” enabling them to move at the pace of change around them. This blog post highlights what these organizations have done right and what others can learn from them.
Leaders can take five actions to implement a structure that will help them organize for the future.
- Radically flatten the structure to minimize layers and increase speed
Cumbersome management layers are the enemy of speed and agility. Leaders should throw out the old rules about the most effective ratios for spans and layers. In a highly digitally enabled world—where bosses are there to empower and enable their employees, not micromanage them, we see often spans as around 1:30. Even the largest organizations shouldn’t have more than six layers; in truly agile organizations, we often see only three layers.
- Build a flexible, dynamic network of teams to tackle rapidly evolving problems
Whether a global pandemic or some other crisis, organizations of all kinds are faced with emerging, fast-moving disruptions in their industries. They need to be able to stand up and dissolve agile teams quickly, easily, and effectively—and with minimal requirements on leadership time and resources.
- Provide a stable home base for employees to ensure long-term career development
The helix model has gained traction recently. Its key idea lies in disaggregating the traditional split of management tasks into two distinct parallel lines of accountability. The capability line is organized in stable skill-pools, where managers are responsible for the long-term care, development, and training of employees. The value creation line, made up of the highest-priority initiatives, is where employees work on a day-to-day basis. The value creation manager ensures that people know what to do on a day-to-day basis.
- Empower the ‘edges’ to ensure leaders have access to the best information and rapid innovation
The organizational structure of the future is designed to ensure that critical people close to the front lines—therefore to the customer or constituent and the product or service—have a voice and are heard. These people typically are close to where value is created or where risks are borne. Empowering these employees to speak up and get involved often requires a cultural shift and close collaboration with the leadership team.
- Delegate clear decision rights to lowest possible levels
Effective decision making is one of the most important elements of the post-pandemic organization. The flattened structure can accelerate decision making by minimizing unnecessary management layers; ensuring people are clear about their roles, responsibilities, and decision rights; and empowering the front lines to make decisions within guardrails.
For the new structure to be effective, other enablers must be present. For example, leaders should ensure the organization has an effective performance management system, clear strategic planning and resource allocation processes, a transparent and dynamic talent marketplace, and a corporate center that facilitates long-term performance and organizational health.
Organizations should build on the momentum gained from their response to the pandemic and ensure their organizational structures are set up to enable and supercharge their strategic goals—not hold them back.
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This blog post is part of a series on Future of work, which explores a set of new principles such as anti-fragility and experimentation that are becoming increasingly critical for today’s organizations as they build more creative, adaptable, and human systems.