Five reasons why flat management structures don’t work

I question the reasoning behind creating a flat structure for businesses. I think business owners, with the best intentions, want to remove hierarchy; they decide blindly to create flat structures because they think it will keep them closer to their staff, assist communication or create a positive culture.

But why are we doing this? It doesn’t make sense and we know flat structures are often riddled with dysfunctional flaws. Flat structures are communication disasters with far too many departmental responsibilities and stretched management capabilities.  

Pancakes are best with maple syrup, but is it best for your structure?

Below are my top five reasons why flat structures don’t work:

1. Structure does not drive culture

Leaders and interlinked HR frameworks drive and sustain culture, a flat structure won’t help, and thinking it will on its own is naïve.

2. Succession – it’s not just for owners looking for an exit

We should always be looking at succession, identifying future leaders and articulating opportunity for ambitious team members. If a career path is not clear, how can we expect our team to hang around and be driven to develop? Clear structures paint a picture of opportunity and this will help retain top talent and drive performance.

3. Roles need to be linked to a functional structure

Structures must be functional, and by functional I mean the roles are linked directly to their purpose in the organisation. Every role should be intrinsically linked to the structure and ultimately the businesses success.

4. Avoid too many direct reports

Even high level managers need your time (regardless of their experience) and more than 3-4 direct reports mean you will not be able to manage and develop your managers effectively.

5. Remove the people

Never build the structure of your business around people and emotion; it is very common that structure (or lack thereof) develops around the need to accommodate individuals. Your structure must be functional and a question you should ask is if I took my staff and the personalities away, would this be the best way to structure this business?

A well-designed and functional structure is your foundation and will drive the sustainability, profitability and ultimately the value of your business. Flat structures can work in micro businesses, but you need to question what is driving this? Is this the equivalent of an ‘open door policy’ – is it there to make your employees feel closer to management and free to communicate openly?

Hierarchy is not evil; it is commonplace in business and society and has been for thousands of years. Having hierarchy in your business is not autocratic, it is sensible. At the end of the day, employees prefer structure and embrace leadership.

I question the motivation of having a flat structure and would like you to give some thought to what motivates you to structure like a pancake.

Sue-Ellen Watts is the founder and director of wattsnext, specialists in HR, recruitment, compliance and people performance.