Is there a role for leadership in flat organisations?

Authority is not going anywhere
Time-sensitive and strategic decisions are best left in expert hands.
For some time now, companies like Google and online retailer Zappos have championed flat organisational structures – where authority is widely distributed, everyone works together in a large space, and employees are encouraged to collaborate.
This has certainly transformed leadership and management styles, but it doesn’t mean that strong-minded managers have become extinct. Lego, for example, has reduced the number of middle managers and empowered its employees to take on more responsibilities, but it has also expanded its top management by bringing in functional specialists and moving senior managers much closer to operations. “Many companies that survived major shocks to technology, regulation and global competition have had strong, charismatic leaders with highly authoritative styles,” researchers Nicolai Foss and Peter Klein wrote in a recent MIT study. So what kind of leadership skills are needed in a flatter organisation?

BALANCE AUTHORITY AND EMPOWERMENT

Managerial authority is not going anywhere. It’s still a very crucial kind of leadership in situations where decisions are time-sensitive. “Decisions that need to be made rapidly are still best left in the hands of one senior manager or a small handful of them,” Foss and Klein say.
It’s also crucial to consider the knowledge required to take a specific business decision. “Employees closer to the action often have better knowledge about local conditions. But senior managers may have more information about corporate strategy, overall market conditions, legal or regulatory issues and other things that are just as important,” the researchers add.

DEFINE THE RULES OF THE GAME

As companies are made up of employees with increasingly diverse skills, leaders should focus on defining and implementing the rules of the game. Take the example of Wikipedia. “Jimmy Wales doesn’t control the content of Wikipedia entries, but he and his colleagues did design the structure — such as the format of the entries, the means by which they are revised and the procedures for resolving disputes — within which the enterprise operates,” Foss and Klein say. Indeed, as employees are expected to multitask, build new skills and collaborate with other teams, managers have to set out a framework for everyone to understand “how things are done” in the company, they explain.

DECENTRALISE LEADERSHIP

Flat organisations give executives a great opportunity to develop their people, and empower them to make important decisions. In other words, they must coach their teams into becoming leaders themselves.
To do this more effectively, they should ensure people across all teams and divisions in the firm understand the business model and develop a strategic mindset. “That means that one has to go higher and train people to be entrepreneurial,” Deborah Ancona, director of the MIT Leadership Center, said in Fast Company. “[Employees] have to think about not only what’s a great technical idea, but can we win in the marketplace and can we make money doing this?”

A stylish calendar app

£3.99
Moleskine has just released a new calendar app, inspired by the stylish notebooks it’s famous for. Timepage organises your appointments as a continuous flow rather than through traditional views of the year, month, and week. It also incorporates weather forecasts and, if you select a location for a given appointment, it shows you the time needed to drive, bike, walk, or Uber to get there. A companion Apple Watch app shows how much time you have until your next appointment.

Related articles