From Corporate Hierarchy to Agility: How to Create Engaged and High-Performing Teams?

“Nearly 6 in 10 employees worldwide feel disengaged at work.” Gallup estimates that this costs the global economy $8.8 trillion, or 9 percent of the global GDP! 💸

Yes, disengagement can be very costly... But that’s not the only problem out there! Today, many organizations with corporate hierarchy also face challenges like:

• hierarchical silos,
• lack of agility,
• meeting overload, 
• lack of initiative,
• lack of clarity,
• lack of meaning at work,
• burnout.

So, what if we started questioning the hierarchical model we’re so used to? Well, that's exactly what we did during our latest webinar!

It's time to explore new ways of working and adopt new organizational models. But which ones? Stay with us as we summarize the great insights shared by our webinar speakers:

🎤 Usarat Tuaichaona, Head of Sales of Talkspirit, a software that helps support new organizational models and more collaborative workplaces.

🎤 Louis Chiquet, Founder of Nova Consul, a management research institute and consulting firm specialized in implementing Holacracy and Constitutional Management

The Limits of Hierarchical Models

Corporate hierarchy comes from the principles of the Industrial Revolution, which were formalized by Frederick Taylor in his 1911 book, The Principles of Scientific Management. Taylor's approach emphasized a clear division of labor. As Louis Chiquet explains, 🎤"what is interesting is that you have somebody who thinks the work, and another who does the work."

This model was revolutionary at the time, enabling large-scale operations and significant efficiency gains. However, despite their historical success, hierarchical models have several major drawbacks… 🎤Our experts highlight the following issues:

• “Disengagement”, as employees often feel disconnected from the decision-making process.
• “Lack of clarity regarding roles and responsibilities” within the hierarchy, leading to communication issues.
• “Lack of agility”, making it difficult to adapt to change.

To tackle these problems, organizations have tried various methods, such as “coaching, training, or introducing new roles like Happiness Officers,” explains Usarat Tuaichaona. 

However, these efforts often address the symptoms rather than the root causes of the problem. A fundamental change in organizational structure is thus necessary to truly modernize and enhance workplace dynamics.

Which Organizational Models Can Help Ignite Potential?

Several new models have emerged to replace corporate hierarchy. 🎤Usarat Tuaichaona mentions some of them, including:

• Participative management
• Lean management
• Agile methodology
• Scrum
• Sociocracy
• Holacracy
• Shared governance
• Liberated company
• Teal organization
• Constitutional management

Are you familiar with these? We also asked our audience via a survey to gauge their knowledge. Here are their responses! 👇

Let's take a closer look at the principles and benefits of each of these models. 👇

Lean Management

🎤Usarat Tuaichaona explains it simply: 

This model was first created by Toyota in Japan over 50 years ago. The aim of this method  was to optimize work and collective success, through 5 key principles:

The 5 Principles of Lean

• Define value from the customer's perspective and focus on delivering what they value.
• Map Value Stream: Identify and map all steps in the value stream to eliminate waste.
  
• Create Flow: Ensure a smooth flow of value by minimizing delays.
• Establish Pull System: Produce work based on demand to avoid overproduction and excess inventory.
  
• Pursue Perfection by continuously improving processes and fostering a culture of continuous improvement.

Sociocracy

Sociocracy promotes consent-based decision-making and peer-to-peer communication. Developed in the 1970s by Gerard Endenburg, it drew on the philosophical ideals of Auguste Comte from the 1850s.

This approach offers an alternative to traditional corporate hierarchy models with more inclusivity and clarity. Here are some of its key principles:

• Consent-based-decision-making: Decisions are made by consent rather than majority rule, ensuring that all voices are heard and considered.
  
  
• Circles: Organizational structure is organized into circles, with individuals often participating in multiple circles.
  
  
• Double linking: Communication across different parts of the organization is enhanced by the double link, i.e. a representative from each circle that participates in the decision-making processes of other circles.
  
  
• Election of roles: Roles are elected by the members of the circle, promoting transparency and alignment with the needs of the organization.

Holacracy

Inspired by sociocracy and other methodologies, Holacracy is a model that organizes work around roles rather than individuals.

Developed in the 2000s by three Americans, Holacracy emerged from a need to address frustrations with corporate hierarchy. 🎤As Louis Chiquet explains, “Those three Americans were very much frustrated with the way the organization in which they were working operated. So, they decided to create their own organization to avoid those managerial issues!”

Here are some of its key principles:

• Role clarity: Holacracy provides clear authority and decision-making power for each role, making organizations more agile and responsive.
  
  
• Objective-driven: The organization’s purpose becomes the ultimate guiding principle, with everyone working towards a common goal.
  
  
• Dynamic governance: The model allows for ongoing evolution and adaptation, ensuring the organization remains flexible and responsive to change.

💡You can also put this governance model into practice with a dedicated tool! For example, our platform, Holaspirit, is inspired by Holacracy and can help with its implementation. But that's not all! It also supports various governance models effectively.

Constitutional Management

Constitutional management involves creating a custom constitution for the organization. This constitution addresses the unique needs and challenges of the business, allowing for gradual evolution and the integration of best practices.

The "6 Territories for Deep Transformation" encompass six key areas crucial for profound organizational change. Each territory addresses different facets of transformation, from evolving leadership styles and strategic vision to adapting organizational structures, refining processes, and fostering a supportive culture for people. In fact, they provide an overview of the visible and invisible elements to be transformed at individual, collective and corporate levels.

How to Make this Transformation Successful?

Transitioning from a traditional corporate hierarchy to a new organizational model requires careful planning and execution. To navigate this change effectively you have to pay attention to several critical success factors.

⭐️ Here are some key strategies to ensure a smooth and successful transformation:

Focus on Your Structure 

Traditional hierarchical models often lead to disengagement and inefficiencies. By building a strong organizational structure, companies can make their teams more agile and responsive.

This means redefining roles, responsibilities, and workflows to fit the new model. A solid structure not only tackles current issues but also prepares for future challenges.

Creating a good organizational structure is more important than focusing on human challenges. 🎤According to Louis Chiquet, “this approach ensures that changes are sustainable and lead to long-term improvements in performance and engagement.”

Choose the Right Tools

Choosing the right tools is crucial to successfully manage your shift away from a traditional corporate hierarchy. 🎤Usarat Tuaichaona explains that “during transformations, some people, especially managers, may want to revert to old ways. However, having the right tool to maintain transparency and clarity in your structure ensures your team remains agile and innovative.”

For instance, a tool like Holaspirit can help in this transition by providing a clear framework for roles, responsibilities, and decision-making processes. Several features that will enable you to increase agility and transparency within your organization!

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Implementing self-management tools effectively ensures that everyone in the organization understands their new roles and how decisions are made, which helps in reducing confusion and maintaining alignment throughout the change.

Change Must Come from the Top

Leaders need to be all-in with the new model and hands-on during its implementation. This means setting a clear vision, hyping up the benefits, and tackling any concerns that pop up along the way. When leaders are visibly engaged and enthusiastic, it creates a culture of trust and openness, making it easier for employees to jump on board with the changes. 🎤According to Louis Chiquet, “ensuring that change is driven from the top is vital for the success of any organizational transformation.”

Leadership commitment also means giving teams the resources and support they need during the transition. Plus, a little cheerleading from the top can go a long way! Effective leadership is the cornerstone of a successful transformation and the secret sauce that keeps the momentum going. 🥫🚀

Seek Expert Advice

Enlisting the help of experts can also help you move away from the corporate hierarchy!

🎤"You have only one shot at it, so it's important to take the time to prepare this change with the help of experts who’ve done it before," highlights Louis Chiquet. Indeed, rushing the process without proper expertise can lead to significant setbacks: "If you don't do it well, you will have lots of delays and potentially a massive backlash with employees."

These professionals bring valuable insights, which can help you avoid common pitfalls and ensure a smoother transition. Their experience can guide you through the nuances of implementing new models of governance. Engaging experts ensures that the transformation is well-planned, effectively executed, and sustainable in the long term.

To Conclude

Addressing challenges like disengagement, silos, and lack of agility is achievable with the right organizational model. To nail this transformation, you need: 

• A solid structure,
• Effective tools,
• Expert advice,
• The right support throughout the journey.

Adopting a new model requires careful consideration and preparation, but the rewards are huge! By embracing alternative organizational models, you can foster a more engaged, agile, and cohesive work environment. So, say goodbye to the old corporate hierarchy headaches and hello to a more vibrant and agile team! 👋

For further insights and practical guidance, download our latest white paper on organizational models below. 👇You’ll discover how these principles can be tailored to fit your organization’s unique needs and drive successful transformation.

Access White Paper

In our white paper "The Ultimate Guide to Organizational Models", you'll get: a comprehensive overview of innovative organizational models (like Agile, Teal, Holacracy, Constitutional Management, and more), testimonials from pioneer organizations that have successfully adopted it, best practices for choosing, implementing and measuring the effectiveness of our model, as well as digital tools to facilitate the transition.