IT Best Practices

Pros & Cons of a Flat Organizational Structure

What’s the Catch?

It’d be nice to not have to wait around for a manager’s approval who also needs their manager’s approval who also, coincidentally, needs approval from their manager and so on. A flat organizational structure takes out all the fluff in between, eliminating the wait for a decision to be made. But how well does a flat structure work? Dana Griffin, discusses the pros and cons of a flat organizational structure in this Houston Chronicle article. 

Communication

In a flat organization, communication is simply better because there are less people to go through to send a message across. However, employees may find themselves doing other jobs as needed as they may end up with more than one boss. Griffin says “their function can become confused with those of another with those of another worker or department.”

Decision Making and Authority

The flat organizational structure disposes of the need for middle managers. Management is decentralized, therefore handing some of the decision-making power to the lower levels aka employees who are closer to the situation. Employees can then resolve issues quicker and move forward to doing other things. 

Costs

Fewer managers mean less people to hire and pay. As employees get happier with having decision-making authority at their hands, the longer they’ll stay with the company and the less training you’ll have to pay for.

Growth

Small businesses can really benefit from a flat structure as quick decision-making leads to better customer interaction, which can give the company a competitive advantage.

Morale

Giving the staff power makes them feel like they’re responsible for company operations and progress, and they’ll’ “work harder since they have a personal interest in seeing the firm succeed.”

As mentioned above, there are many benefits and disadvantages to a flat organization structure. It just depends on how you use it. Griffin advises that:

 Incorrectly used, however, flat organizations can be magnets for job confusion and decreased loyalty. Flat organization is most practical in small businesses and within smaller departments of large organizations since the few management layers make running a large company nearly impossible.

To read the full article, click here: http://smallbusiness.chron.com/pros-cons-flat-organizational-structure-3798.html

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