“Make everything as simple as possible, but not simpler.”
– Albert Einstein
Since the recession, the flattening trend has gained momentum. In contrast to the traditional pyramid model, flattened organizations have fewer executive salaries and fewer layers of. But will shedding layers of management benefit your organization? Or can it harm your business?
Effectively Overworked Managers
Organizations may be at risk of burdening managers with too many direct reports. According to a 2013 Corporate Executive Board study, the average span of control for a manager increased from six to 12 direct reports from 2002 to 2012.
The CEB writes: “While leaders can take specific steps to shift roles and expectations to improve collaboration, they must also help employees perform better at fundamentally different work. The challenge of managing in the new work environment is compounded by the fact that work is less supervised and, by extension, more autonomous.”
Organizational performance is largely driven by a manager’s effectiveness and his/her time is very important to an organization’s overall success. By creating too large a burden on managers, these initiatives can be counterproductive.
Lacking Accountability and Authority
Effective managers must establish a framework of accountability and authority with clearly defined roles for teams to be successful. One of the primary issues with the flattened structure is that systems have not been put in place to ensure managers and employees throughout the organization are working in a consistent way, or worse, not making decisions that will be harmful to the organization. Managers must delegate accountability or authority in such a way that team members are empowered to make decisions and take initiatives within context.
The CEO is required to establish this framework, which will be applied all levels of the organization with the same precision and clarity.
If you don’t have a Framework, you Create Confusion
If your organization is small, with a clear vision and individuals who understand his/her accountability, you can get away with fewer layers of management. But, as the organization grows, you will need systems in place to determine the work of the CEO, to delegate and meet strategic objectives.
With larger organizations, you will need to create a framework of accountability and authority. Without this, confusion will be created at the handoff point between individuals when there are various levels of specialization in an organization.
Individuals must fully understand their accountability and identify how their work relates to the rest of the organization to effectively meet the strategic objectives of the company.
You can have Too Many Layers
On the other hand, you don’t want too many layers. This can happen with legacy organizations that created their organization design over time in an organic way. In these situations there’s often an overlap between managers in terms of accountability and authority. This can lead to confusion because there’s not a properly functioning managerial chain from the CEO down to the frontline.
I’ve talked about rules of the road before and it’s a perfect example in this situation. When a town is still new and very small, you have very few cars on the roads and people can figure it out. But when you have a city, you need rules or traffic will be gridlocked. It’s the same with an organization. If it’s very small, with one or two dozen people, you can figure it out and be very successful. But when you reach 100 or 200 and more, in order to avoid collisions and gridlock, you need managers that are effective.
