When organizations embrace a flatter structure, traditional management goes overboard. It no longer fits the new values. Often teams become self-supporting. That doesn’t mean there is no longer leadership in the company. It is just much more dynamic than it is in the traditional hierarchical structures. So, how does leadership work in progressive companies?
A new perspective on leadership styles
Different situations call for different leadership styles. Some of the most commonly recognized leadership styles, in the corporate world of today:
Authoritarian (Autocratic) leadership. This is common in hierarchical organizational structures. One — or a select few — managers have control over all decisions, with little input from team members. Autocratic leaders typically provide clear expectations for what needs to be done, when it should be done, and how it should be done.
Democratic leadership. Democratic leaders offer guidance to group members, but also participate in the group and allow input from other members. They promote cooperation and include everyone in the decision-making process.
Transactional Leadership. This leadership style is based on reward (and punishment). Transactional leaders ensure that routine work is done reliably, but the status quo stays.
Delegative leadership. Delegative (laissez-faire) leaders give group members the freedom to make decisions. They provide them with the materials and tools they need but step back and let them work how they want.
Transformational leadership. Transformational leaders inspire their team with a shared vision of the future. They motivate and encourage the team to reach their full potential. Team members are typically involved and engaged.
Each of these styles has its strengths and weaknesses, and they can all be effective in different circumstances. In the end, leadership isn’t about imposing a single style, but about being versatile, adaptable, and above all, responsive to the team's needs. A leader is good when he or she can positively influence people. We’ve warned before about HIPPOS: not the big animals, although they can have a big mouth in common with the hippos we’re talking about. The Highest Paid Person’s Opinion is not always best for a company.
As we move away from traditional hierarchies, leadership styles become even more crucial. As you can understand, sometimes a shift is necessary. You can’t be an authoritarian leader in a flat organization.
Corporate rebels: away with hierarchy
Traditional hierarchical structures have long dominated the corporate world. These structures, often visualized as pyramids, are characterized by clear chains of command and well-defined responsibilities. But despite them being around for long, they have challenges.
The problem with traditional hierarchy
Traditional hierarchies can lead to an array of problems, like:
- Lack of collaboration
- Territorial managers
- Less innovation
- Lower employee engagement
They can also create communication barriers. And let’s not forget bureaucracy, which slows everything down. Moreover, they often result in an uneven distribution of power, leading to disparities in skills and salaries across different levels. This demotivates staff and hinders opportunities for taking on responsibilities. Many times, innovation and productivity suffer too.
Our vision on leadership
At Corporate Rebels, we advocate for a shift away from these traditional hierarchies. We believe in fostering a completely different style of leadership, one that is centered around those on the frontline. Radical transparency is the way forward. Our vision of leadership challenges the status quo and encourages organizations to do the same.
We’ve seen this new reality with our own eyes, visiting over 100 progressive companies around the world. These organizations embody our mission and values. They work hard to make sure employees thrive.
Our vision of leadership is not about imposing a single style, but about being versatile, adaptable, and above all, responsive to the needs of the team.
Real-world examples
That’s all nice in theory, but let’s look at some hugely successful organizations that embraced a radically different leadership style.
Buurtzorg is a Dutch community care provider. Their organizational structure is incredibly innovative. With around 15,000 employees and no managers, Buurtzorg boasts outstanding patient and employee satisfaction metrics. Overhead costs are a third of their competitors.
At the heart of their model are self-managing teams supported by coaches. There’s minimal bureaucracy and an innovative IT system. They focus on feedback, open communication, focusing on team health, and leveraging each team member’s unique strengths. Leadership is not confined to a single role, but is a shared responsibility.
Cornerstone is one of the largest social care companies in Scotland. They’re taking three years to transform their organization. CEO Edel Harris researched innovative companies like Buurtzorg, leading to significant changes within Cornerstone. They’re reducing nine layers of management and trimming down their 52 policies to just seven essentials. They’re flattening their hierarchy. Like Buurtzorg, Cornerstone is growing self-managing teams supported by coaches. This participative style of leadership ensures that everyone feels valued and heard.
Patagonia is an outdoor clothing retailer. The company has a unique organizational model. Within the organization, they created micro-enterprises. Each micro-enterprise operates independently, creating entrepreneurship among employees. This leadership style encourages innovation, as employees are given the freedom and responsibility to make decisions that directly impact the users.
How to be a leader in a flat organization
In a flattening organization, the role of a manager evolves. When middle managers disappear, the role of leadership changes. In many of these non-hierarchical organizations, leadership moves around. A leader is appointed for a project, for example. Or for a certain time. Besides not having a corner office or prime parking spot, this means leadership changes on many fronts.
Of course, there are other roles for leadership, like encouraging cooperation and covering the reward system of the organization. This can all vary in each organization.
There can still be room for promotions. It just doesn’t have to automatically mean that when you’re good at your job, you move up to a (middle) management role. Because how often is the best (salesperson/ nurse/ carpenter/ teacher) also the best leader?