Hierarchy Is overrated

By Tim Kastelle via http://blogs.hbr.org   Article

“… the Second Chance Programme is a group that raises money to help reduce homelessness among women ….  It’s achieved impressive results since being founded in 2001, and is run by a committee of about ten people. In the early days, a management consultant used the familiar chiefs/Indians line to predict they’d fail. This kind of thinking assumes:

  • You need a hierarchy to succeed.
  • The people that do the work are of lower status than those that decide what work to do.
  • Organizations that don’t follow the norms are likely to fail.

… But maybe this kind of structure only works for not-for-profits?

Valve is a gaming company that makes Half Life, Portal and many other popular games.  Their software is proprietary.  And they are famous for not having bosses at all.  And 37Signals has a structure that looks a lot like Automattic’s, while building software that enables distributed collaboration, such as Basecamp and Ruby on Rails. …

Gore is one of the most successful firms in the world.  They have more than 10,000 employees, with basically three levels in their organizational hierarchy.  There is the CEO (elected democratically), a handful of functional heads, and everyone else.  All decision-making is done through self-managing teams of 8-12 people: hiring, pay, which projects to work on, everything.  Rather than relying on a command-and-control structure, current CEO Terri Kelly says

‘It’s far better to rely upon a broad base of individuals and leaders who share a common set of values and feel personal ownership for the overall success of the organization. These responsible and empowered individuals will serve as much better watchdogs than any single, dominant leader or bureaucratic structure.'”


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