Advantages of reduced hierarchy - Essay Example

? ADVANTAGES OF REDUCED HIERARCHY Advantages of Reduced Hierarchy Introduction Hierarchy in organizations helps in ranking organizations into different levels. The ranking takes place in a manner that each employee is ranked above or below the other in the chain. This creates a situation when employee has several other employees working under him in that chain. In the past, hierarchy helped to define the role of employees within the same organization. It also outlines the relationship between employees. Hierarchy makes organizations stand out with limited control spans. Several organizations are becoming flatter, reducing levels of hierarchy and widening the span of control. There are several reasons to explain this promising trend among the hierarchical organization. However, hierarchical organizations have their share of disadvantages. First, hierarchy makes organizations assume a bureaucratic nature. This can slow the response rates to the needs of customers within the operations of the organization. Additionally, hierarchy in organizations contributes to the weakening of communication links within organizations. Furthermore, since hierarchy assumes a horizontal nature of information flow, some beneficial decisions can remain with the top of the hierarchy, making the employees at the bottom of the hierarchy disadvantaged (Fernandez & Gonzalez, 2001, p. 108). Based on these reasons, many organizations are resorting to the reduction of hierarchical levels within the organization. This paper will explore some of the advantages reduced hierarchal would benefit an organization. The need to stay profitable in the fast changing business environment has made business organizations reexamine their management styles. Organizations whose hierarchal structures are tall are less likely to respond quickly to external changes compared with entities with flatter hierarchal structures. The need to hasten the structure of management of any business enterprise requires the implementation of the process of delayering. This allows a business organization to remove some structures in its hierarchy to maintain a flatter hierarchal structure. Although this process has some disadvantages to the business, it also has multiple benefits as well. Hierarchical organizations ensure that employees at the apex of the hierarchy enjoy greater prestige and privileges as compared to persons at the base of the hierarchy. As much as this benefits people at the top of the hierarchy in terms of increased self-esteem, self worth and other material benefits, it also contributes to the disorientation of the employees at the bottom of the hierarchy. As a result, these people will feel disadvantaged due to increased feelings of low self-esteem, limited or lack of access to handouts and low self worth. Consequently, their output would drastically reduce. Consequently, the productivity of the organization would equally reduce as well. It is necessary that organizations reduce their hierarchal levels to reverse this trend (Wallgrun, 2010, p. 119). Hierarchy in organizations ensure that somebody at the top only deal with the person who is directly under him or her. This implies that a top manager would not likely communicate directly with individuals at the bottom of the hierarchy. A hierarchy has several levels meaning that people only work with persons that are immediately below or above them. In case where a certain decision is supposed to reach everyone in the organization, this process would be so unyielding and time consuming. This is because the hierarchy does not address people directly by the top management. However, reducing the multiple levels of hierarchy would help to quicken the flow of information within the organization besides ensuring that little distortion to the information happens. The reduction of hierarchal levels within business organizations would ensure that employees get the opportunity to communicate with each other. This enhances teamwork besides creating a good working atmosphere for the organization. Additionally, when information reaches employees directly from the top management, they can boost their abilities and skills. Besides, flattening of the hierarchal structure encourages delegation of duty amongst the employees. This ensures that employees do not suffer from de motivation and overstretching of duty. However, the most significant benefit of reducing the hierarchal layers in a business organization is improvement of the vertical communication structure. Additionally, this reduction has a direct outcome in the lessening of the overhead costs for running the business. In essence, the business organization will likely save money with a flattened hierarchal structure. This is because a reduced hierarchal organization would have fewer people in the chain of management. Besides, there would be more people in direct contact with the products and services that the organization offers. Consequently, the cost for every piece of product would reduce drastically with the reduction of overhead management layers. Furthermore still, there would be increased levels of job retention, and this would help save money for training the new recruits for the organization (Capon & Hulbert, 2007, p. 95). A flattened hierarchy can also help an organization to increase its accountability. This would be attributable to the fact that no employee would pass the back to the other employee due to the outlined focus area in the organization. Consequently, the managers would get a chance to assess the individual employees’ strengths and flaws to recognize their areas of efficiencies. The application of a flat organizational structure requires sufficient and elaborate training of employees. This kind of training should be multi faced and cross cutting. When an organization takes its employees through this kind of training, the employees become more flexible and ready to face myriad nature of problems as they arise. As a result, the business organization would register a speedy growth because it would solve most of the problems that clients experience. Additionally, it would quickly fix most complains that prove to be formidable challenges to tall hierarchal organizations. The reduction in the hierarchal levels for business organizations is tantamount to the reduction in the number of managers that the business organization has at any given moment. This would imply that employees get the opportunity to participate in the decisions affecting the organization. Experts indicate that decisions made without many interventions from the top management are friendly and appealing to any organization. In this case, the business organization must embark on a training program to ensure that it equips its employees with relevant skills of the right process of decision-making. The result of this would be the empowering of employees so that they would adequately serve, satisfy and retain customers. A flat hierarchal structure plays a role in empowering employees to be diverse in their thinking and mandates. This is particularly relevant to an insurance company that has a tall hierarchal chain upon which the insurance agentts who are in direct contacts with the clients are not involved in decision making for the company. When the sales agents of an insurance company are adequately empowered, they would be able to offer the most desired information to their clients (Novoselov, 2007, p. 86). The reduction of the levels of hierarchal structure in an organization also plays a leading role in the customer-centric focus. It is only those employees who are in direct contact with customers that understands their needs better. This means that a flat organization would ensure that the employees who frequently interact with the clients of the business organization are directly occupied in the decision making process. For instance, a banking organization that offers loans to its clients need frequent and close interactions with the clients to evaluate their potentiality to repay back the loan. Closer interactions with the bank clients helps the managers and the bank employees with relevant information to engage the credit worth of their clients before extending loan advances to them. Conversely, managers would be forced to serve customers so that they become up to date with what the customers want for adequate decision-making procedure. A flat organization has contributed in moving administration closer to the client. This would ensure that customers ask for and receive their needs from the business organization. Consequently, a business organization that does achieve such a state would be appealing to customers. It is also likely to increase its revenue base through improved sales (Martin, 2005, p. 439). Conclusion Two categories of organizational structures important for the management of the business and its employees exist especially flat and tall hierarchal structures. Each of them has its advantages and cons. However, the rising costs of running a business coupled with the fast changing business environment would require the adoption of a flat hierarchal structure of management. This is concerning the facts described above. Nonetheless, as business managers adopt the flat structure, they must recognize the challenges. The lack of one specific for employees to report to within a flat structure is tantamount to neglect of important duties for the organization. Besides, this structure does not have clear specifications of employees’ duties. Reference List Capon, N, & Hulbert, JM 2007, Managing Marketing in the 21st Century: Developing and Implementing the Market Strategy, Bronxville, N.Y, Wessex Publishing. Fernandez, JA, & Gonzalez, J 2001, Multi-Hierarchical Representation of Large-Scale Space: Applications to Mobile Robots, Dordrecht, Springer. Martin, J 2005, Organizational Behaviour And Management, London, Cengage Learning EMEA. Novoselov, KE 2007, Internal Controls, Collusion, and Hierarchical Structure, New York, ProQuest. Wallgrun, JO 2010, Hierarchical Voronoi Graphs: Spatial Representation and Reasoning for Mobile Robots, Heidelberg ; London, Springer. Read More