To forward-thinking business professionals, "hierarchy" might seem like a bad word. But really, traditional business hierarchies used to be everywhere. The CEO would sit in his corner office and send down mandates and updates from the top, often without knowing or communicating with employees. Information flowed down the chain until it reached the entry-level employees at the bottom. With a push towards flatter organizations and innovation, hierarchies these days seem to get a bad rap. But are they really as bad as they seem?
In short, it depends. There are two ways to look at a hierarchy: as a structure for the organization so everyone knows their place, or as a way for the business to operate with one-sided communication flowing from the top of the organization.
A hierarchy serves a great purpose in helping every employee in an organization see where they fit in the big picture of things. A hierarchical org chart is very easy to read and makes sense. Employees know exactly what they need to do to reach the next level and get a promotion, and seeing how everything fits together can facilitate collaboration and communication--if you want to talk to someone in marketing, all you have to do is find the department manager and reach out.
Hierarchies can be useful because as much as we don't like to admit it, most people perform better with some sense of structure. As much as many employees say they want a completely flat organization, most of the very successful organizations have at least some degree of a hierarchal system. One study even found that people could memorize pictures and names of random people when they were organized like a hierarchy.
On the other side, hierarchies can be bad when the organization functions like a pyramid in the traditional hierarchal sense--mandates come from the top and no one questions them. Just because an organization's structure may look like a pyramid doesn't mean it has to work like one. A one-sided, top-down hierarchy can stifle the employee experience and leave workers with a lack of power and control over their situations.
The future of work is moving towards organizations where employees feel valued and have the tools they need to reach their potential. In a stagnant hierarchy, employees can't express their concerns and requests up the pyramid, so their voices are never heard. This can also stifle collaboration and communication between employees at different levels and in different areas.
Perhaps the best solution is a "flatter" organization. Not quite as pyramid-shaped as a hierarchy and not as linear as a completely flat organization, a flatter organization has some sense of structure but still gives employees freedom to move, collaborate, and innovate. After all, even companies that claim to be completely flat have some sense of an unofficial hierarchy--it's part of human nature. Try putting a group of
people in a room together and some people naturally step up as leaders, creating an unofficial hierarchy.
A flatter organization takes out unnecessary layers and red tape, but still leaves a skeleton in place for organization and control. In a flatter organization, workers can collaborate and even each out to the CEO if needed. Many companies, including IBM, have had great success with flatter business plans.
The bottom line is that a hierarchy may not be as bad as we think it is--it just needs to be implemented correctly and for the right reasons. When a traditional hierarchy transforms to a flatter organization, everyone wins.