What Is a Flat Organizational Structure? (With Tips)

By Indeed Editorial Team

Updated September 8, 2022 | Published November 5, 2021

Updated September 8, 2022

Published November 5, 2021

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

One of the major considerations when starting a business is the organizational structure. This determines levels of communication, information dissemination, management, and delegation of responsibilities. Learning more about different types of organizational structures, like the flat model, can help company operations be more efficient and establish an effective chain of command. In this article, we define a flat organizational structure, highlight its benefits, review who can use the structure, discuss tips for implementing it, and look at other types of organizational structures.

What is a flat organizational structure?

A flat organizational structure is one in which there are few levels of middle management between leadership and employees, or in certain situations, none at all. Small businesses and startups frequently have an organizational structure that is flat due to their small size and no need for hierarchical administration. There are fewer steps between an entry-level employee and the company's CEO within a flat structure, so most employees have a greater sense of accountability and autonomy in their job. They also have a greater capacity to make major decisions without consulting others.

Benefits of a flat organizational structure

Here are some benefits of a flat organizational structure to consider:

Reduced operating expenses

In an organization with a flat structure, individuals below management level may handle decision-making. As a flat organizational structure doesn't use middle management roles, it may also result in reduced operating expenses due to less staff. This enables the organization to reinvest those expenses in areas such as growing the business, developing new product lines, improving employee training, providing bonuses and increases to employees, or acquiring extra production equipment.

Increased responsibility

Because of the absence of middle management, most employees have a greater responsibility than they may have had in a traditional organizational structure with many levels of management. This can make individuals feel more encouraged, appreciated, and involved in the organization where they work. This increased responsibility has its own set of advantages, such as increased job satisfaction and a greater desire to work with the team.

Related: Manager vs. Supervisor: Key Differences and Duties

Easier information transmission

In a hierarchical organizational structure, company news and other forms of information like procedural modifications, typically pass through many channels before reaching specific employees. The transmission of information is considerably easier and faster in a flattened organizational structure, and there is a reduced risk of the employee getting incomplete or wrong information. When information exchange is straightforward, employees can incorporate it into their tasks, which benefits the entire business.

Improved coordination

You may discover a flat organizational structure enables greater collaboration amongst teams co-managing a project. With fewer layers of administration to navigate, employees are frequently accountable for their own work, which allows them to develop stronger collaboration skills and reach consensus on processes more quickly. This can improve efficiency and productivity for the company overall.

Increased productivity

Employees are often more productive as a result of the autonomy, empowerment, and cooperation that comes with this style of organizational structure. Project approvals may be accelerated, allowing staff to begin work sooner and complete tasks more quickly. Increased productivity can help an organization thrive and increase employee motivation, which often results in increased job satisfaction, willingness to take on additional tasks, and loyalty to the company.

Talent recognition

Another benefit of an organizational structure that's flat is being able to each employee's skills and experience to the best of their ability, as they have more responsibility. In this structure, it's easy to recognize a team member's talents and place them in the best position or assign them the tasks to help them excel. This also involves identifying areas for team improvement and offering tools and opportunities for team members to learn new skills. A flat organizational structure can use mentorship services to help staff define their career paths.

Positive workplace culture

Employees are likely to have better relationships with each other if they don't have as many layers of management to work through. This contributes to a healthy corporate culture, along with transparency and accountability, role equity, autonomy, and improved communication. An impressive business culture also attracts top talents and competent candidates who are looking to work for the organization.

Related: What Is Workplace Culture? With Definition and Tips

Who can use a flat organizational structure?

A flattened organizational structure is most commonly found in small organizations, where staff can have significant authority and direct access to leaders without compromising the business' efficiency. If a larger business has a flat organizational structure, it's also typical for them to have a defined procedure in place that functions effectively without the intervention of middle management. Organizations that place a high value on innovation and decision-making may benefit from a flattened organizational structure.

Tips for implementing a flattened organizational structure

Here is a list of tips for you to consider if you are interested in implementing a flattened organizational structure in the workplace:

  • Develop training. In order to feel supported as an employee in a flattened organizational structure, proper and complete training is necessary. Consider the most important aspects to communicate to employees, from new hires to more experienced staff members, and develop training programs so they feel confident in their role.

  • Provide access to resources. Because employees have the opportunity to solve problems and work independently without the input of multiple layers of management, it's imperative that they have access to the resources they need. Consider developing a hub where all employees can access the information they need about policies, procedures, and processes so they can make informed decisions.

  • Communicate expectations. Even though employees have autonomy and the power to make decisions without levels of managerial approval, it's still important that they know what the organization expects of them. This can give the employee some direction and help them feel comfortable performing their daily tasks.

  • Create ways for employees to grow within the company. If you adopt a flattened organizational structure, there may be less opportunity for employees to progress in the company. Career growth is important for many people, so it's important to create ways for them to accomplish this within your organizational structure.

  • Develop an open-door policy. If there isn't already an open-door policy, create one so employees know that they have direct access to executives for any questions, concerns, or ideas they may have. It's important that employees feel comfortable approaching leaders in the business, so ensure you are clear about their ability to do so.

  • Decide how flat to go. You can decide how flat your organization structure is by determining how many levels of management you need.

Related: How to Use Organizational Culture to Find the Perfect Job

Other types of organizational structures in the workplace

Here are some other types of organizational structures for the workplace to consider:

Matrix structure

In a matrix organizational structure, employees separate into different teams and report to a project or product manager and a functional manager. Because these teams have two supervisors, a matrix organization encourages resource sharing. Employees that work for matrix-structured organizations can broaden their skill set by working closely with others who have a variety of knowledge and skills.

Some advantages of the matrix organizational structure include:

  • It encourages open dialogue between employees and their managers.

  • It can help create a more flexible work environment.

Related: Understanding a Matrix Organizational Structure

Functional structure

This is one of the most common types of organizational structure. Organizations with a functional structure have specialized groups within the team, each with distinct tasks and responsibilities. This structure, sometimes called a bureaucratic organizational structure, is often present in small to medium-sized organizations. For instance, many businesses organize themselves into distinct divisions, such as finance, marketing, and human resources. The departments each have a manager or supervisor and the manager has an administrator or executive who is in charge of many departments. Some advantages of this structure include:

  • Management can divide employees according to their skills.

  • There's an increased sense of collaboration and teamwork.

Related: Functional Organization Structure: Pros and Cons

Divisional structure

Multiple teams collaborate to accomplish a single, shared purpose in a divisional structure. These divisions each have a director who oversees their operations, finances, and resource allocation. This organizational structure is common in large organizations. For example, a car company may separate itself into sedan, SUV, or electric car divisions. Although each branch serves a unique purpose, they all strive toward the same objective of making a profit by selling cars in their inventory.

The advantages of this structure include:

  • greater concentration and focus on a specific product or service

  • increased centralization of leadership

Related:

  • What Is a Divisional Structure? (With Pros and Cons)

  • What Is Organization Hierarchy? (With Definition and Types)


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