Is Your Organizational Structure All Wrong?

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Most entrepreneurs dream of developing the next great product and growing their company into a noteworthy enterprise brand. They have a business plan, and they have every box checked in terms of how they intend to build the business… except the structure. All too often the actual organizational structure of a company is formed accidentally, if not altogether overlooked.

Then once you’re the owner or leader of a big organization, the hierarchy seems set in stone and isn’t given a second thought. But, it needs a second thought. In fact, your organizational structure can make an enormous difference in your business’ success – and this is even more true after the impact COVID-19 left on businesses. Here’s why.

The Rise of the Chief Remote Officer

COVID-19 accelerated the prevalence of remote working more quickly than anyone anticipated. With nearly two-thirds of all American workers presently working remotely, organizations will need to consider pivoting the way they organize their businesses and layer their employees. As companies in all industries strive to adapt to this new environment and the challenges it brings, business leaders are adding a new role to the C-Suite – the Chief Remote Officer.

In general, this new position should be responsible for a wide range of roles related to facilitating remote work within an organization. This includes developing and introducing new strategies to remote employees as well as those in charge of managing them, connecting with remote workers to ensure they feel like a valued part of the team, and helping them to create a work environment at home that will be as enjoyable and productive as possible.

GitLab, which has been all-remote since 2011, was the first organization to create the Head of Remote role. Last year, Twitter, Facebook, Quora, and Okta were some of the first to post a similar position. Some companies are giving the job to cross-company teams or executives with other jobs rather than hiring or promoting someone new. Hewlett-Packard Enterprise, for example, has 10 senior executives from a variety of teams working on its approach to remote and onsite work.

Last summer, KPMG Advisory surveyed American workers and found that 64% said they wanted the flexibility to work remotely at least part of the time. With such spread-out workforces, it is important that companies continue to prioritize having a position that oversees remote work so engagement, collaboration, and satisfaction remain high.

Flat is the Future

Another prominent change within the organizational structure is organizations adopting a flatter hierarchy. Before the pandemic, SMBs and enterprise organizations functioned with layer upon layer of hierarchical structure. This impacted the decision-making and implementation processes, as decisions and plans had to go through many players and wind their way through multiple departments.

The pandemic has accelerated the move to a “flatter” organizational structure. This is in large part due to virtual meetings being held over Zoom, WebEx, and other platforms, resulting in people being seen in their “home office.” Leaders have realized that they can trust and rely on employees to still produce positive results remotely, even with personal distractions surrounding them.

In a recent report, McKinsey & Company recommended that organizations “flatten the structure.” A flattened organization has the benefit of agility, more people taking action and fewer people feeding the beast of bureaucracy—briefing each other, reporting, seeking approvals, sitting in unproductive meetings (and then huddling up after the meeting to have the real conversation).

Therefore, rigid hierarchies must give way to leaner, flatter structures that allow the system to respond quickly to emerging challenges and opportunities. There are fewer middle managers and span-breakers and more doers and deciders. Creating this new organism requires reimagining the structure not as a hierarchy of bosses, per the traditional organization chart, but rather as a dynamic network of teams.

Structure Impacts Culture

Leaner, flatter structures with the right people focused on critical areas to ensure employee success will enable organizations to completely embrace the future of remote work. “Structure is actually one of the most important components of a company,” says Louis Carter, founder and CEO of the Best Practice Institute. “When a company implements the right structure, key goals and key results ensue. Structure also helps create culture, and when the culture is such that people love being together in the workplace, incredible things happen.”

Squarespace is a stellar example of a company with a flat structure and very minimal management levels. Its structure is said to encourage creative thinking and collaboration, and the company has unsurprisingly been voted a Best to Place to work for many years. Quamcom Research & Technologies is another company that took this idea very far, becoming completely flat and even removed its CEO position. The organization operates through role-based responsibility and an emphasis on efficiency, all of which have led to success.

These companies are a testament to the power of rethinking a longstanding organizational structure and experiencing big results. So, what about you? Are you ready to step into the future, and re-envision this important part of your company’s foundation? It’s worth the time and energy to get it right.

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