Creating flatter organisations: the key to unlocking individual potential

The argument for creating flatter organisations that contain fewer managerial and supervisory levels to open up lines of communication and increase collaboration is not a new one.

Managerial layers affect how quickly decisions are made, how accountability and authority are distributed, and the sense of empowerment that employees feel.

But is there a magic number of layers that help us deliver the expected business value? Long answer short … no. 

Flatter organisations tend to be less time and resource wasteful

While there is no magic number, here’s an observation: flatter organisations tend to be less time and resource wasteful, have higher employee satisfaction and engagement, and faster and more accurate communication and information flows. Often, we notice that organisations with a large number of layers have gone through a rapid and sometimes unstructured growth over the years, without taking the time to analyse and assess the impact that adding new layers to their structure has had. 

In this situation,  we will see organisations with poor organisation design (duplication of roles, accountability overlaps, or skill gaps at critical positions) and weak governance models. Each additional strata will dilute authority and add extra complexity which hinders the ability to respond to customer or business needs in a fast and efficient way. Development opportunities for employees will be reduced and they will start to feel limited and stagnant in their jobs. 

Empowering people through a flatter organisation structure

Therefore, how can we unlock people’s potential and help them grow through a flatter organisation structure? Here are six key tips to keep in mind before delayering: 

1. Always look at your organisation ecosystem as a comprehensive ensemble: it is very difficult to roll out a flat structure in a separate function and in isolation from the rest of the organisation. Consider looking at it layer by layer instead of function by function.
2. Remember the impact of changing management relationships: historically and socially, appreciation at work tends to be demonstrated through titles and the number of direct reports. Making changes without proper change management and a clear message around “what’s in it for me?” could discourage employees and result in low motivation and disengagement.
3. Structure your coaching and mentoring internal approach: changing the shape of your organisation to a flatter structure doesn’t mean that you can’t recognise and reward the experience and expertise of key collaborators. SMEs need to be identified and their position in the new structure clarified to enable and support their colleagues and the more junior employees.
4. Explore the idea to separate management tasks with day-to-day activities in the way you build your new structure. Having a matricial model, with solid and dotted reporting lines for both types of activities, can give your employees the flexibility and balance they need between performance management and growth enablement. 
5. Solidify your decision-making process at the same time: clarify and document roles & responsibilities across the organisation, engage with your employees to discuss key decision-making rules and agreements (e.g. do we want to be consensus-based, consent-based, a sociocracy, etc?) Once agreed upon, provide support and tools to deploy the decision-making process (design governance bodies, provide tools to track decisions, ensure transparency and data quality to make objective / data-driven decisions, etc)
6. Invest in capacity / work prioritisation tools and resources: with fewer managers per resource, it will be necessary to have a consistent capacity management approach that is looked at across the entire organisation and all layers. Having a specific resource to organise and structure the team’s workload will enable transparency and objectivity around how the work is being sliced and distributed between the teams and resources.

Reorganisations are often perceived as a cost reduction exercise but it is, in fact, a great opportunity to rethink how we want our employees to feel empowered to be innovative and agile while receiving the support they need to grow. A flat structure with the right mechanisms in place rolled out with the appropriate change management approach, will result in a workforce that is committed to your mission and is enabled to learn, grow, and deliver great work.

If you want to talk more about how to create a flatter organisation please get in touch. 

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