8 Reasons Why a Flat Organizational Structure Is Important

Amy Little, a workforce planning specialist at tech consulting firm Saggezza, shares eight benefits of a flat organizational structure.

Written by Amy Little
8 Reasons Why a Flat Organizational Structure Is Important
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UPDATED BY
Matthew Urwin | Dec 07, 2023

During the height of the pandemic, many companies struggled to continue their daily operations. Offices were closed, managers’ days were filled with meetings and employees were finding it difficult to stay motivated and complete their work.

What Is a Flat Organizational Structure?

Flat organizational structure is a model that allows companies to have low levels of middle management. The goal of a flat organizational structure is to have more open communication and little hierarchy between executives and frontline employees.

Surprisingly, I didn’t experience any of these issues while working remotely. My days were filled with more meetings, but my workload was still manageable. This is because at Saggezza we are truly a flat organization.

We’ve been able to continue operating at the same level because employees typically don’t need to go through multiple levels of approval to get their work done. We make decisions quickly, act fast, and collaborate in such a way that there is no single point of failure at the company.

 

Flat vs. Hierarchical Organizational Structure

A flat organizational structure often has flexible roles and very few managers, giving all employees more duties and autonomy. In contrast, a hierarchical organizational structure features rigid roles and a clear chain of command where some employees have more authority and decision-making power than others.  

While a hierarchical organizational structure can lead to more efficiency within a larger company, it can also limit creativity, innovation and collaboration. A flat organizational structure has less defined roles, so employees are free to help with different tasks and work with members across the company. And because there are fewer layers of management in a flat structure, any employee can participate in making decisions and be more accessible to customers.

 

Benefits of a Flat Organizational Structure

If a flat organizational structure sounds appealing to you, you may be wondering what large companies can learn from flat organizations. You can start by considering these eight benefits.

Benefits of a Flat Organizational Structure

  • Trust
  • Transparency
  • Confidence
  • Passion
  • Autonomy
  • Fail fast
  • No single point of failure
  • Agility

 

1. Trust

Trusting employees is essential for flat organizations, and that trust needs to go both ways. Managers need to trust their employees’ ability to make decisions. And it’s just as important for employees to trust their managers as it is for employees to trust their own judgment. If an employee feels unsure or wary of making important decisions, they will never be successful.

 

2. Transparency

The most important question managers fail to ask is: “How do I build trust?”

Transparency is key to building trust, because employees will feel informed, understand the company’s goals and see how these goals align with their work.

 

3. Confidence

Confidence is trust in action. While trust is based on belief, confidence is built on logic and facts.

 

4. Passion

Passion is more difficult to establish, and it would be naive to say most people are passionate about their careers. Most managers fail to understand how to invoke passion in their employees because they view passion in the wrong way.

Managers need to find out what their employees are passionate about and create opportunities to incorporate that into their employees’ work.

 

5. Autonomy

Autonomy and passion go hand in hand. Nothing will kill an employee’s passion faster than being micromanaged. Autonomy enables employees to find better ways to do their job or become involved in new areas of the company, outside their core competencies.

 

6. Fail Fast 

Failure is inevitable.

Think about something that you previously spent a large amount of time working on, just for it to fail in the end. That lost time could have been spent working on other things that would have succeeded, but there’s also value in the lessons learned.

Failing fast will help you and your team learn faster, allowing you to move forward with more insight, more quickly. Don’t be afraid to fail, and don’t punish failure in your employees.

 

7. No Single Point of Failure

A popular critique of flat structure is that you end up with a lot of generalists and no specialists. Realistically, true specialists are hard to find at most companies anyway, and a flat structure will not drastically impact that.

With many generalists on your team, many people share the ability to perform essential tasks. No one presents the risk of being a single point of failure.

 

8. Agility

The word “agile” is used more and more every day. If your company doesn’t operate on agile principles, you’re viewed as a dinosaur.

Even if agile doesn’t work at your company, key aspects of this technique can still be incorporated. All organizations can benefit from increasing collaboration and pivoting in a crisis.

 

Flat Culture Requires Closely Connected People

All the principles of a flat organization are interconnected: Transparency builds trust, and trust instills confidence. Confidence allows individuals to be comfortable with the potential of failure. Autonomy creates a sense of pride and passion. Agility and collaboration increase transparency and decrease the likelihood of a single point of failure. Without all of these, it would be nearly impossible for employees to pivot quickly when things don’t go the way they were planned.

During times of crisis or uncertainty, many companies could benefit from reconsidering their internal hierarchies and flattening their organization.

 

Frequently Asked Questions

A flat organizational structure features fewer managers and minimizes the importance of titles, giving employees more autonomy and responsibility. All employees can then take on a variety of tasks, collaborate across teams and directly interact with customers and clients.

A flat structure creates more transparency, empowers all employees to make decisions and allows teams to adapt quickly, among other advantages.

Flat organizations often have fewer managers and equip employees with more autonomy and responsibility, leading to more innovation and creativity. Hierarchical organizations emphasize a chain of command where roles are strictly defined and come with varying levels of authority and responsibility. In this setup, efficiency is prioritized over innovation and collaboration.

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