Elizabeth Claypoole was taking her dog to daycare when she ran into Eric Ward, one of the CEOs of AgBiome, a North Carolina biotech company where she is responsible for human resources. When the daycare receptionist asked her how they knew each other, she replied, “Well, he’s kind of my boss.” »
Ward grimaced. AgBiome has adopted the “flat” business model: committees are preferred to managers. Despite their titles, co-founders Scott Uknes and Ward are “anti-CEOs,” says Claypoole.
Some organizations and companies, like AgBiome, have adopted or tried a flat, non-hierarchical structure. Among them are Suma, both a wholesale company and a workers’ cooperative, and Valve, a video game studio. This unusual structure can be motivated by principles, political ideas or income. It involves removing levels of management and promoting democratic decision-making.
According to Saerom “Ronnie” Lee, assistant professor of management at the Wharton School at the University of Pennsylvania, flat structures work well in small businesses and start-ups. But when they expand, “it usually becomes very difficult to coordinate the work of employees,” he added.
Do flat structures work? It was “in the air” to denounce hierarchies as “wrong”, but their necessity is increasingly recognised, says André Spicer, professor of organizational behavior at Bayes Business School in London. Moreover, they are often seen reappearing in companies that rejected them (at least in theory).
In 2012, Valve’s handbook for new employees was leaked, revealing a work model that advocated autonomy and the absence of team leaders and allowed employees to move from project to the other as they please.
But in 2013, ex-employee Jeri Ellsworth said in an interview that there is a powerful yet hidden management structure at Valve: “It was very reminiscent of high school. A 2022 report uploaded by People Make Games — YouTube video game investigative journalism channel — discusses issues around employee diversity and evaluation, among other things. (Neither Ellsworth nor Valve responded to interview requests.)
Clifford Oswick, professor of organizational theory at Bayes, points to the “inherent risks” of discrimination in companies with extremely flat structures. These may reflect the same prejudices as society, without there being any safeguards to avoid them. So “it’s still privileged middle-aged white men making the decisions up there,” he says.
The idea that the flat structure is particularly poorly suited to young shoots was supported in a 2021 study by Saerom Lee, of the Wharton School.
Given these challenges, some companies in 2023 believe that keeping the hierarchy at bay is less important than challenging work practices that prioritize profits over ethics. For example, Dark Matter Labs, a non-profit social organization, believes that the future of work cannot be reduced to the monetary needs of big bosses. “In a way, I think we could be described as non-hierarchical, but we don’t describe ourselves as such internally,” says Annette Dhami, who works in organization and governance at Dark Matter Labs. “If we were to talk about it, it would be called a dynamic hierarchy. »
“We recognize the existence of hierarchies,” she adds. But we don’t structure them in terms of patterns. »
Instead, they use “role cards” of employee choice that outline their responsibilities and tasks. There are also “stewards” who foresee the big picture, but do not manage teams.
Rather than do away with hierarchy altogether, companies like Dark Matter Labs are trying to use alternative structures that don’t focus on conventional employee productivity.
What about AgBiome? As it has grown, it has introduced an element of accountability into its structure, meaning someone is accountable for every area of the business. AgBiome has also made other structural changes moving away from the consensus.
But the ambition to do otherwise remains. In a “normal company”, managers can make decisions quite easily; in a flat structure, “you have to listen to all these people,” Ms. Claypoole notes. “But I like to think that when you get a bunch of smart people together, that challenge, hopefully, helps you move forward.” »
