Doug Baird, CEO of people advisory firm New Street Consulting Group who helps you find, assess, build and accelerate teams and leaders.
How would your company perform without managers? It’s an interesting thought, as Amazon announces a potential reduction (paywall) of around 14,000 managers to streamline its organizational structure. It’s a move that could save the company more than $3 billion and, according to proponents, potentially enhance corporate culture and avoid bureaucratic delays.
Of course, Amazon won’t be going completely without managers, but it certainly seems to be exploring the benefits of a flatter organizational structure. It’s a trend gathering momentum—several CEOs I know have discussed interest in a similar approach and it was a hot topic of discussion during my recent OPM course at Harvard Business School. Perhaps most interesting is the fact that the move toward flatter organizational structures isn’t always driven by cost savings. Leaders are increasingly motivated by the other advantages of creating managerless teams.
The Potential Benefits Of Fewer Managers
People, teams and organizations will always need strong leaders. To reconsider wider structural changes, it’s fundamental to have strong leaders in place to make sure the vision and values are clear. They provide a guiding light, even when other changes are made. But there are potential benefits to fewer managers.
Streamlining a chain of command creates an opportunity to improve, strengthening the ability to quickly adapt to changing circumstances. This has become appealing to business leaders in recent years, who’ve had to contend with ongoing global events that caused supply chain shocks and market volatility. Building resilience has become a strategic objective for many organizations and there’s growing awareness that more nimble management structures can support this.
Greater autonomy can also prove motivating and rewarding for staff, which can positively impact the quality of their work and productivity. There’s also the potential for flatter organizational structures to accelerate research and development, as well as innovation. One of the biggest gripes I hear from C-suites in large established businesses is that smaller competitors steal a march on them because they get to market quicker. Flatter structures can allow for faster decision-making in big businesses, while still respecting the importance of due diligence.
Lastly, removing levels of management can create a culture of free-flowing entrepreneurialism. Many of the staff who are involved in day-to-day processes will have the greatest insights about what works well, what needs improving and what’s missing. They can spot opportunities and act on these, without running into the delays sometimes caused by reporting upward through middle management.
How To Create A Managerless Team
So, how do organizations move toward a flatter structure and create high-performing managerless teams? Through onboarding, collaboration and recruitment.
Onboarding
If management levels are taken out of the mix, employees need to be provided with a clear explanation for how the new organizational structure works. Staff should be onboarded as though they are new to the organization, with expectations and responsibilities clearly communicated. This should involve an overview of how decision-making works in the new structure and how each individual can actively contribute to the organization’s goals.
There may also be a need for training, which helps equip people with the skills to manage their own workloads and enhanced responsibilities, as well as developing their knowledge and understanding of how to tackle problems and seize opportunities. A good starting point is for leaders to analyze the key elements of the management level and then identify how they empower employees to embrace these traits.
It’s also important for onboarding to connect employees with each other. Management may have previously acted as a conduit and inadvertently limited an employee’s opportunity to interface with others. It’s crucial that becoming managerless doesn’t create a void that leaves employees isolated.
Collaboration
Managerless teams thrive in cultures of transparency and accessibility. Employees must feel able to connect with leaders and peers so that they can self-manage and self-direct. The ability to discuss work and to gauge a second opinion on a decision is particularly important, especially during the early days of a flatter structure being introduced.
Staff will be used to previous ways of working, where they would have conferred with a manager, who will have acted as a sounding board and provided useful reassurance. People must now find this support among colleagues. This requires clear and accessible lines of communication and for leaders to facilitate sharing among employees. Straightforward measures—such as hosting regular catch-up sessions between staff or setting up channels for discussions and knowledge sharing—can help.
Leaders must show they are available to staff and create a working structure that respects everyone’s time and capacity. Scheduling dedicated one-to-one briefings with staff can create an opportunity that supports self-management and direction, as can assigning time for “surgery sessions.” The latter creates a window in the calendar where staff feel comfortable calling on leaders for insight and opinions.
Recruitment
Hiring strategies should evolve to concentrate on identifying and selecting people who are autonomous, determined and resilient—characteristics that will enable people to succeed in a flatter organizational structure. The recruitment process must also prioritize problem-solving skills, experience and competency in decision-making. Managerless teams require individuals who take ownership and are prepared to think through issues and seek out possible solutions first, rather than readily deferring to someone else.
The recruitment process—as well as retention plans—must also emphasize the growth and reward opportunities for employees. People may wrongly think that a flatter structure limits the opportunity for career progression because management roles have been reduced. Leaders will need to play to the strengths of the flatter structure by creating horizontal growth opportunities, while also demonstrating that the removal of management levels can enhance progression up the career ladder.
Adopting a flatter organizational structure is about much more than simply removing levels of management. It’s a strategic step that requires a focus on onboarding, collaboration and recruitment to create a culture of autonomy. When done well, this approach can help yield the benefits of a shorter chain of command, which, in turn, can deliver new levels of effectiveness and efficiency.
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