"In today's volatile markets, where abilities to explore and innovate are greatly valued, traditional command-and-control hierarchies are impediments to creativity. As the world's workplaces become more diverse, corporate leaders are urged to transform workplaces into more complex, interconnected and dynamic living organisms." -- Maria Collar, January 2013 HR Magazine
In Thomas Friedman's book The World is Flat he asserts that the world has become so connected globally that innovative start-ups and small business enterprises are able to compete and win in the global marketplace more so than major corporations. According to the U.S. Small Business Administration, small business enterprises (with 500 or less employees) account for 52 percent of all U.S. workers. A particular strength of small businesses is their ability to respond quickly to changing economic conditions. Being nimble in their business approaches is obviously one strength of a small business enterprise (SBE). However, another major strength is that small business enterprises tend to have flatter organizational structures. Corporate leaders have come to realize that titles and hierarchies can hinder company growth and competitiveness. Additionally, a younger generation of employees might not be as enticed to follow a corporate career ladder path. The same can be said for employees who are increasingly looking for work-life balance.
This isn't to say that structure doesn't have its place in a company. Policies, procedures and business practices are all valuable guiding posts to help employees implement the corporate vision and goals. The difference being that they are valuable when used as tools and not dictums. And whether you are a large organization or a small business going through growing pains, you can easily learn from the flat and collective leadership approach that has helped many SBEs successfully compete in the marketplace. Collective leadership may look like this:
- Rotate team leadership responsibilities. This frees you from the often conflict-ridden "labor vs. management" philosophy where people often struggle to put themselves into the other person's shoes. The rotation of leadership roles puts everyone into the same place of understanding.
- Share the knowledge. A flatter organization helps a company move away from the knowledge hoarder attitude you find with older or larger organizations. Establish an internal Wiki and provide time for in-person forums for knowledge exchange. All your employees should have access to the same information to be able to perform their role in the best fashion.
- Reward with desired responsibilities. Promoting just because the person has outgrown responsibilities isn't necessarily the best business decision. Instead allow him to expand his knowledge and do what he is best at.
- Adjust performance metrics. Pay people generous salaries, good benefits and lifestyle appropriate perks. People often seek promotions because it translates into a higher pay scale. Base your merit increases and salary practices so that your employees will want to master their competencies and increasingly take these skills to the next level.
- Empower employees to make decisions and hold themselves accountable. Establish clear communication on what expectations you have for the individual and team. Let the implementation then reside with the employee. If issues arise, allow the employee to tell you how she will rectify the situation or what measures need to be implemented.
While the collective leadership approach might not be appropriate for all organizations, there definitely are learning lessons from organizations who embrace this approach. Even applying just one principle to lead collectively can set you on the path to transform your company to compete in the 21st Century economy.
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