Instructor: David Schuff, Section 003

The Growing Popularity of Flat Organizations

team photoFor many years, most US corporations have focused on a hierarchal organization structure for their organization. The structure typically meant that an employee has a boss, that boss reports to their boss and so on until you reach the CEO at the top of the command. Today, many corporations are moving towards eliminating hierarchy amongst their organization and becoming a flat organization. In a flat origination, there are no bosses, everyone is equal and working together as a team. This creates an opportunity for employees to be able to work on projects more efficiently by removing barriers such as, time needed to get upper level approval. Ciplex, a marketing agency that adapted a flat structure, noticed that after the change, projects that would normally take six months, only took six weeks to finish. The company also noticed that employees are happier and have a greater focus on improving customer satisfaction. With more project being completed, more can be taken on, increasing both revenue and satisfaction. Yet, with the removal of upper management, it can often bring up some odd rules. At Valve Corp., a video game company, pay is voted on by peers and promotions are nonexistent. Ciplex, fired any employee who resisted the change, and now has a policy where employees vote off anyone they don’t like. My questions that have risen from this article are: What do you think about flat organizational structure? Do you think you would be able to sacrifice not having a boss for equality? Is a flat organization only realistic in certain companies or can it be universal?



3 Responses to The Growing Popularity of Flat Organizations

  • Dante,

    I like the examples that you gave of the positive and negative outcomes resulting from a flat organizational structure. I would have to agree that moving towards a flatter organizational structure can be the best choice for some companies and provide a lot of opportunity, but can get out of hand for others — I do not think that it should be adopted universally, especially after reading about Ciplex and its seemingly unfair policies. However, the same can be said about a hierarchical organizational structure, where executives are sometimes so far removed from lower level employees that tasks take forever to get done. Companies should evaluate themselves in order to decide which structure style will bring them the most success.

  • The article you have chosen has a very interesting take on the flat organizational structure. I think in theory, the idea of having a flat organization, where there are no bosses and where everyone works together as a team is nice and I can definitely see the appeal, but I do not know that it is the right choice or should be the right choice for all types of organizations. The idea of sacrificing not having a boss for equality would probably work better in smaller organizations, where employees may where many hats, or perhaps in more creative-oriented organizations, where collaboration is key. On the large scale, however, I do think a more hierarchical structure does hold some value. The beauty of the flat structure lies in the emphasis on collaboration and equality between employees, but in larger organizations, this is harder to achieve. The bigger a company is, the more difficult it becomes to have everyone on the same level, there are just too many people to have to agree on decisions. The example you gave with Ciplex supports this argument that the flat organizational structure may not be right for all organizations, as the “voting each other off the island” sort of mentality that developed seems to be a negative side effect of the flat organization, and makes me think that this sort of structure may not be the right fit for that company. That being said, many organizations thrive with this type of organizational structure, so, although I do not think it should be adopted universally, the flat organizational structure can definitely be a better fit than a hierarchical structure for some organizations.

  • Dante, your analysis of the benefits and takeaways of a flat organization structure was thorough and easy to understand. I think more companies will continue to try to implement a flat organization structure as industries continue to emphasize innovation and disruption. Flat organizations enable more creativity, but the lack of decision making procedures can make implementing those creative ideas difficult. In my opinion, flat organizations are a better option for smaller and more agile companies because “equality” can function more easily in these situations. I think the shift towards flat organizations are is a trend; however, I think a flat structure would focus well for certain divisions in a organization, such as application development.

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