An organizational chart shows how a company is structured which fundamentally dictates things like authority and workflows.
While many organizations choose to adopt the classic hierarchical ‘chain of command’ structure, whereby authority flows from top (the CEO and other executives) to bottom (team leaders and functional staff), there has been a noticeable shift in recent years to non-hierarchical alternatives such as ‘flat’ organizational structures.
What is a Non-Hierarchical Organizational Structure?
Where a hierarchical structure has many different layers of management and lines of authority, a flat structure is the opposite: it has only a few.
In a non-hierarchical organizational structure, managers have a much wider span of control with more employees sitting subordinate to them. This leads to an inherently shorter chain of command. That is if one exists at all.
Although hierarchical structures have been the go-to option for over a hundred years, many companies are now opting to adopt non-hierarchical structures, such as the ‘flat’ and ‘matrix’ structure, which are far more ‘modern’ and liberal due to them having fewer management levels and less centralized power.
Types of Non-Hierarchical Organizational Structure
There are many examples of non-hierarchical org structures, but two are more well-known and widely used than the rest: i) the matrix and ii) the flat structure.
Matrix Organizational Structure
The matrix organizational structure is a sort of halfway house between a hierarchical and fully non-hierarchical structure. While it features a management hierarchy, it is nowhere near as linear as the traditional top-down hierarchical structure.
In a matrix organization, each employee will report to two managers: a functional manager and a project manager. The functional manager is the direct ‘line manager’ while the project manager oversees a cross-functional team of employees from different departments who are working towards a common goal. This leads to a shorter grid-like structure.
Flat Organizational Structure
In comparison to the matrix structure, the flat organizational structure is much leaner. It’s very short, wide, and usually eliminates middle management entirely. It’s often referred to as being more person-first orientated and gives regular employees a lot more autonomy and decision-making power.
We usually see flat org structures in brand new start-ups and smaller organizations that don’t have many employees or complex operations. However, there are plenty of examples of flat organizations staying flat even as they grow. It all boils down to the organization itself, its product or service, and how well everything is managed internally. It also helps if the executives and managers that do exist are able to maintain a suitable level of control.
Advantages of Non-Hierarchical Org Structures
A non-hierarchical structure has several key advantages.
In the absence of strict hierarchies and lines of authority, employees are far more empowered and have more responsibility and autonomy. This encourages individual work creativity because employees are not constrained to fixed roles. It also encourages functional diversity between different roles which means everybody can join in and contribute to a project rather than them existing in departmental silos.
There’s also a lot more transparency in a non-hierarchical organizational structure due to the more limited amount of bureaucracy that exists. Having fewer levels of management also leads to faster decision-making and streamlines internal communications; there’s far less back-and-forth between teams and those that wield power and thus less wasted time.
Most importantly, the elimination of middle management in a non-hierarchical structure means that power and responsibility are divided more equally throughout the organization at all levels.
Disadvantages of Non-Hierarchical Org Structures
It’s important to consider the potential downsides along with the advantages.
The biggest problem with a non-hierarchical structure is that it’s much harder to scale it as an organization grows. While a non-hierarchical structure will work well for smaller companies, it can start to become inefficient during periods of high growth because the executives and managers can begin to lose control if the organization isn’t properly managed. This can lead to poor decision-making and a loss of productivity.
While we’re mentioning productivity, non-hierarchical structures assume that all employees are going to always give it 100 percent. Since non-hierarchical structures are more laidback and lack close supervision—i.e., a team manager keeping everyone in check—it’s very easy for employees to get away with slacking off and not completing their work. By the time this has been noticed, the damage has probably already been done and projects can fall behind as a result.
Highly skilled workers can also suffer in a non-hierarchical environment. This is because they like having the opportunity to advance up the ladder. But if there isn’t a ladder to climb, i.e., by taking on supervisory and middle management positions, there are fewer options to advance. An employee who is looking for a challenge therefore may well end up leaving the company in search of one where they will be able to progress to higher levels.
Making Your Choice
Although the choice of hierarchical vs non-hierarchical structure is one for you to make alone and while there technically isn’t a right or wrong answer, you should keep a few key points in mind.
A non-hierarchical structure might be better for your organization if you’ve got a product or service that is a product of innovation. This is why many start-up tech companies choose the non-hierarchical approach; they benefit more when employees have more autonomy and have the power to bring about change internally.
On the other hand, a hierarchical structure will be better if you want to maintain power and authority through different departments and levels of management. This might be necessary if your business has a product or service that has a more complex product development cycle where department-specific managerial oversight is necessary throughout.
Build Your Org Structure with Organimi
Whether you decide on a hierarchical or non-hierarchical structure, using a modern org chart building tool like Organimi rather than a traditional org chart makes it easy to build an accurate and dynamic visual representation of your employees, their roles, and their functions.
Organimi org charts are fully interactive, customizable, and shareable, meaning they can be built and adapted to meet the needs of any organization no matter how it’s structured. They can also be used with a suite of third-party integrations that add even more power and simplify the user experience.
Sign up for a 14-day free trial of Organimi to try it out for yourself.