“The typical management hierarchy increases the risk of large, calamitous decisions. As decisions get bigger, the ranks of those able to challenge the decision maker get smaller. Hubris, myopia, and naïveté can lead to bad judgement at any level, but the danger is greater when the decision maker’s power is, for all purposes, incontestable” Harvard Business Review, 2011.
There’s a good reason business hierarchies are beginning to flatten, bureaucracy is being significantly reduced, and transparency is intentionally increasing…because very simply businesses will fail if they don’t make these adaptions in the current context.
In times where we can ask Google anything and have the answer in milliseconds, Millennials find hierarchical business cultures frustrating because they understand that they are holding business back. One of the areas deemed to be in need of an overhaul is decision-making. Traditionally the bigger the decision, the fewer the people involved.
The top 6-8 senior leaders would gather behind a closed door, debate amongst themselves, develop some group think, repeat assumptions until they believed them, and then made their decision. Sound familiar?
They would disseminate the decision, which ultimately left their employees wondering how they reached the conclusion that this was best the best way forward. These decision are handed down, frequently with little explanation, and certainly with no room for debate, disagreement, or discussion.
As society has shifted from ‘children should be seen and hot heard’, to ‘our children are the centre of our universe’, the hierarchy between the young and old has flattened. As millennials find this hierarchical decision-making culture absolutely baffling.
In the age of information, digitisation, and diversity and inclusion, every voice matters (or at least it should) in the eyes of Millennials. So, again, these top-down decisions make little to no sense. Millennials see this as putting the cart before the horse and are thus changing the rules:
– Good decisions beat fast ones.
– The bigger the decision, the more people we consult.
– Speed can be recouped by trusting and empowering employees to make and implement smaller decisions without layers of hierarchy.
A HBR Article discusses the case study from Morningstar (https://hbr.org/2011/12/first-lets-fire-all-the-managers). The title of which is ‘First, Let’s fire all the Managers’.