Hierarchy Versus Hierarchy Debate in Organizational Structures - Essay Example

Hierarchy versus Heterarchy debate in Organizational structures Contents Contents 2 Introduction 3 Literature Review 4 Implications of the Literature8 Practice Relevance 10 Conclusion 11 References 13 Introduction A heterarchical organizational system is one where the organizational elements are unranked or are non-hierarchical. The elements of the organization have the potential to be ranked on a number of different parameters. Warren McCulloch introduced the concept of the heterarchy organizational system in the year 1945. Heterarchical organizational structure is somewhere between the network and the hierarchy that allows different organizational element to coordinate through its horizontal link, and helps in optimizing the success criteria individually. It represents the relation of elements to one another who are unranked or can be ranked in different ways. An organization is a very intrinsic system, and to make the system to remain sustain a considerable amount of flexibility is required (Dawson, 2009, p.13). This kind of organizational flexibility is given by the heterarchy organizational structure where the flow of information is not constrained. On the other hand a hierarchical organizational structure is one where every organizational entity excluding one is the subordinate of the other entity. It is not a flattened structure and has a centralized power of control. In this kind of structure the power is on the top level and it diminishes at the subsequent levels (Allee, 2002, pp.78-79). The hierarchical organizational structure is seen almost in every big company where there exist different levels of power of authority and management. But in today’s scenario of adaptation to more of flexible structures heterarchy organizational structure is the best mode for system formulation. Though it has not been seen as a very regular measure in many organizations but those corporations who has such a flattened structure is more flexible and provides better scope for development. Thus according to me both the structures has its pros and cons but heterarchy organizational structure is the best structure to be adapted. Heterachy organizational structure is a lateral coordination of organizational diversity. It has been characterized as a distributed intelligence that is negotiable at multiple evaluative criteria. Literature Review From the past two centuries hierarchical organizational structure has been the dominant model. In the early 19th century the traditional approach in the organizational system was more prominent. The bureaucratic traditional approach emphasized more on the rational control. This control was exercised through formalized communication in order to avoid misuse of power. Scientific management gained more efficiency in the traditional approach. Throughout the years a hegemonic standard structure was the hierarchical structure. According to Lipman-Blumen in 1992 the hierarchical structure was considered to ensure a safe place in the workplace for the male competition. Increased involvement from the female workforce is a factor influencing a change in such kind of a structure. Lipman – Blumen throughout the study has emphasized on the fact that the scenario has changed and now the world is more networked place compared to past. For sustaining in such scenario a more connected leadership is required. Lipman – Blumen analyzed more of psychological aspect and gender component in relation to the hierarchical approach. This structure best suite the males, by creating a centralized power of control and less interconnectivity and equality amongst the entities. According to his studies leadership is seen as much of integrating individualism, and seeing the world as a system of unique and interconnected parts rather than unequal, isolated and independent entities (Lipman, 2000, pp.77-79). Fairtlough in 2005 in his study explained briefly about the implications that the adoption of such a structure causes to the society. He even stated that the hierarchical structure causes many problems in the business environment as people without any question starts depending on hierarchies. The ‘great man mynth’ of the leader to be the one person to be valued in the organization has been perpetuated. Fairtlough has very clearly stated in his study that such a structure puts the power entirely on one individual at the same time decreases the empowerment and engagement of other individuals in the organization. According to him the reason behind the structure still persisting is that it provides clarity of positions and roles, it avoids conflicts’, provides familiarity, and the workers can be motivated personally due to rise in the hierarchy of the members (Fairtlough, 2005, pp.151-152). Fairtlough stated that in order to sustain more effective model is required and these advantages cannot be beneficial enough for sustaining this model in the organizational system. Goleman in 2007 in his book Social intelligence stated that the traditional approach of hierarchical organizational structure affects the well being of the subordinates working in the system emotionally. In hierarchies that are rigid the head tends to follow authoritarian style due to which they express less of contempt making the people working below them feel insecure and remain fearful. Goleman in his studies argued for more of an employee friendly workplace by shifting from the traditional rigid hierarchical structure that creates negative emotional implications on the subordinates. There are different alternatives that are considered for restructuring of the organization (Miles, 2013, pp.114-116). An organization is not a hierarchical machine but a biological organism as stated in the Systems Approach to Management. In the systems approach it is stated that all organizational elements tends to influence one another. These alternative models helps in resolving conflict more efficiently and are more adaptive. According to Von Bertalanffy the organizations should act as systems in order to survive and should be easily adaptable to the changing environmental conditions. In the early 1970s the shift from the traditional hierarchical model started with the emergence of some open management system structure. Organization is related more to a family in the relation approach to management. In 1960 McGregor rejected the traditional approach in The Human Side of Enterprise and introduced the term relational approach. The systems which follow such an approach believe that not a stressed employee but a happy employee is more productive. Heterarchical organizational structure has emerged as a new business model in the current literature based on organizational models. This kind of organizational system demands collaboration and interdependence. According to DiMaggio in 2005 in his studies stated that heterarchy is new mode which is neither a market nor a hierarchy; as market comprises of independent relations and hierarchy comprises of dependent relations, heterarchy comprises of interdependent relations. James Henderson in 2007 in his work in adapting to changing strategy stated the shift from the traditional hierarchies. The study criticized on the fact that the hierarchical approach has its relevance in the past years but it is now inadequate with modern world conditions. There were initial strategies for diversification made by the management which shifted the traditional method to a more of a multidivisional structure. The author puts emphasis on the fact that may international firms and NGOs has adapted the heterarchical organizational structure rather than the hierarchical model. The author strictly rejects the approach of the top-down model. Verna Allee argued in his studies that the traditional approach is changing due to necessity as the structure is very cumbersome, slow and costly. She summarized on her argument saying that most of the companies are now shifting towards a networked market in which these kinds of boundaries within the organization becomes very problematic. Amazon and eBay where the business is entirely based on the online transactions the users mainly rely on the business structure. Such organizations have adopted the new model form. In such kind of organizations which are based on the ever shifting and global internet based users and sellers, such inside and outside lines of the organization is inappropriate this is where the traditional approach becomes inadequate. The information network across the organizational system is increasing rapidly where a considerable amount of flexibility is required. In this scenario the hierarchical approach fails drastically as it is a rigid form of system with no flexibility. Organizations should be able to adapt to a changing environmental scenario. This requires implementation of new models which could account for the interconnected business community’s boundaries. Fairtlough in his work stated that the end of 20th century proved to be a turning point for many organizations which shifted from the old model of hierarchy. Karen Stephenson in his study in 2009 argued against the hierarchical model and placed an alternative. She stated that it is the responsibility of the leaders to build some collaborative, meaningful structures which would help the system to sustain for a longer run. Stephenson stated that as the world is rapid increasing it connectivity there is a need to build a new structure that encloses the ancestral network with the market and the hierarchical form, which led to the foundation of heterarchy structures. She stated that heterarchy can be well related to nonsummativity. She outlined the fact that the heterarchy would require more of work and connectivity but at the same time would be flexible enough to adapt to any change. Dawson stated that there is no clear definition for the term heterarchy, and the word has different meanings in different areas. Another author Frew in 2009 in response to Stephenson said that heterarchy can create meaningful changes and the impact of such changes can be sustained for a longer time. Frew noted from his studies that the heterarchical structure needs to form a difference in appearance in the for-profit world compared to that of a non-profit world. According to Fairtlough such a structure is more useful in a non-profit community. He stated that heterarchy ensure more of personal responsibility, it reduces down tyranny, triggers cooperation and commitment towards a common goal, fosters innovation, learning, teamwork and uses more of diversity. Art Kleiner in 2009 in is studies stated that the concept of heterarchy will be a new format for the society and commonly a second nature to those who adapt to it as hierarchy became hegemony in the past. As Brown and Adler in 2008 stated in their works that in the changing scenario of the environment the systems should not only incorporate this structure but also provide constant learning and support to the workforce which will result in creation of innovative ideas and skills (Kleiner, 2009, pp.12-13). According to the authors the structure that accommodates information sharing and continuous learning is the best structure to be incorporated. In this respect the use of a heterarchical structure is the efficient method of increasing flexibility as well as avoiding the consequences that hierarchical structure creates. Implications of the Literature According to all the facts stated by the various authors I feel that in today’s business scenario the concept of heterarchical structures play a vital role. As stated by Fairtlough the hierarchical structure results in more of rigidity and creates a lot of issues in the business environment. This is mainly because of the fact that a hierarchy creates a formal atmosphere where the ideas of subordinates are suppressed and not given much value. The power of control is on a particular member which lowers down the engagement of other subordinates into the system. The flow of communication both ways is very essential for a sustained business environment. I feel with the advantages stated by most of the authors heterarchical organizational structure is the best model in today’s changing environmental scenario. Heterarchical model is a shift from the common top-down organizational model to an equalized and shared-power organizational structure. This structure is more of a flattened structure and is a collage of networks that can resolve many conflicts (Clegg, Kornberger and Pitsis, 2011, pp.43-44). If the non-profit models are based more on the heterarchical system it ensures more of connectivity and collaboration. Successful implementation of such an approach helps the workers not to be disengaged from the board and also helps the clients to be closer to the bureaucracy who makes the decision in respect of the kind of services they would receive. This structure helps in involving all the members of the organization and thus increases the responsibility of individual members. Even such kind of involvement increases the motivation level of all the subordinates when they do not hesitate in passing their ideas and neither feels inferior. Such a shift in the structure makes the organization more adaptable to the changing events and gives an advantage for more opportunities and innovations. Such a structure encourages individual leadership where each of the members takes ownership of their roles. A heterarchical system breaks down the traditional structure that encourages disempowerment and focuses more on the overall organizational innovation. This structure even helps in reducing the founder’s syndrome. This condition is seen in many organizations where the founder cannot leave an organization at the same time cannot adapt to changing requirements of the environment. In such cases the heterarchy structure is best suited because it allows the founder to train its successors and resign from the system which will ensure a sustained growth for longer term. This in turn helps implementation of the organization’s mission rather than securing the position of the founder. The system needs a shift from the top-down model to the flattened structure. As argued by Fairtlough and Goldsmith the system which incorporate such a structure requires power and control relinquish by leaders and more of engagement by the employees. Such kind of heterarchical system requires different leadership skills comprising of teamwork, skills for dialogue, interpersonal skills, openness and mutual respect. The use of heterarchical organizational structure is very beneficial for the organization compared to those following the traditional approach. It helps in sharing of decision making and power, increase in communication level, increase in informal networks and collaboration, catalyst for growth and development will be conflict, increase in engagement and individual participation in the organization, decrease in the traditionally in charge management level, being more adaptive to the changing external environment conditions, and there will be a need for diversity in the leadership styles. Hierarchical system was a traditional approach that was followed by the company without even analyzing the fact that the system needs to be adaptive to the various changes. Many researchers started analyzing various aspects of management in organization that resulted into findings of many disadvantages that a hierarchical structure has. The common amongst them was the lack of flexibility in the system. With the formulation of alternative strategies there resulted into more of interdependence amongst the system. As the organization becomes more intertwined and the interconnectivity increased it resulted into more of communication sharing within the organization which lacked in the rigid systems. This kind of requirement was best suited by the heterarchical approach. This kind of structure helps in enhancing interdependence in the organization. This approach helps in reducing the conflict level and decentralizes the power of control. It gives a platform for effective sharing of innovative ideas, thoughts and opportunities. Still there are many organizations which do not take the risk of adapting to such a new form of structure and continues with the traditional approach. On the contrary there are many such international firms and non-profit organization that has adopted this new form of structure and succeeded in long term. Practice Relevance A hierarchical organization is expected to create more awareness of the members as well as improve the participation of all the levels of members. The heterarchical approach used in an organization encourages communication and innovation within the organization. A heterarchical organization structure would instill success in both profit based organizations and nonprofit organizations. Though the hierarchical structures are most commonly used in the organizations but there are inherent weaknesses in the structure which makes the hierarchical models less viable than the heterarchical models used in organizations. The heterarchical organization structure employs a flat structure which makes the organization more equipped to absorb conflicts and discrepancies. Due to the changing requirements of the global business perspectives, the organizations are becoming more closely knit and intertwined with information technology systems. This makes the practical implementation of the hierarchical model more redundant and enhances the strengths of the hierarchical organizational structure (Wright and Dana, 2003, pp.135-152). Leadership, innovation, communication and administration are the key requirements that influence the success of a heterachical structure incorporated in an organization (White and Poynter, 2008, p.120). In the changing global business scenarios, hierarchy is considered to me a theoretical concept which is difficult to be implemented in the practical working of an organization due to the disadvantages associated with the concept (Williamson, 2003, pp.453-454). A heterachical structure would be much more consistent in absorbing the changing values in the society and culture, conflicts within the business and the environment due to the concepts of shared power embodied in the structure. Thus, the modern day organizations are shifting towards a heterachical structure from a hierarchical structure to ensure better innovation and communication within the business processes. Conclusion In theory, a hierarchical organization is considered to be an ideal structure for an organization, irrespective of whether it is a profit based or a non-profit organization. But, in practice, the heterarchical organizations are proving to be more efficient due to the several beneficial characteristics associated with this structure. Heterarchy in an organization ensures better communication and collaboration of information networks. The heterarchical organizations are more powerful in absorbing conflicts wherein the conflicts can be used as catalysts to boost the development and growth of the organization. Heterarchy in an organization also ensures the removal of the traditional problems faced in hierarchical organizations through the establishment of employee empowerment and sharing of information. Also, the heterarchical organizations encourage the participation and engagement of the employees in the business activities. The empowering of individual members within the organization facilitates innovation and individual leadership within the organization. This ultimately improves the performance of the employees as well as the business. A heterarchical organization ensures that it is flexible and can adapt quickly to the external changes in the environment. This makes the businesses more equipped to reshape their business practices according to the shifting needs of the market. Leadership is boosted in heterarchy whereas it is much restricted in the hierarchical system where the managers are the main decision makers and the employees are the followers. Encouraging leadership improves the efficiency of the business by facilitating a smooth flow of information and knowledge and each member participating actively in the functioning of the organization. References Allee, V. 2002. The future of knowledge: Increasing prosperity through value networks. Woburn, Massachusetts: Butterworth-Heinemann. Dawson, R. 2009. Heterarchy: Technology, trust and culture. People & Strategy. Vol. 32(1), p.13. Fairtlough, G. 2005. Three ways of getting things done: Hierarchy, heterarchy, and responsible autonomy. Bridport, Dorset: Triarchy Press. Kleiner, A. 2009. Heterarchies: Human nature transformed? People & Strategy. Vol. 32(1), pp. 12-13. Lipman, B. J. 2000. Connective leadership: Managing in a changing world. New York: Oxford University Press. Miles, J. 2013. Management and Organisational Theory. New York: Wiley. Clegg, S., Kornberger, M., Pitsis, T. 2011. Managing & Organizations: An Introduction to Theory & Practice. London: Sage Publications. Williamson, O. E. 2003. Calculativeness, Trust, and Economic Organization. Journal of Law and Economics. Vol. 36 (1), pp. 453-454. Wright, R. W. & Dana, L. P. 2003. Changing Paradigms of International Entrepreneurship Strategy. Journal of International Entrepreneurship. Vol. 14(1), pp. 135-152. White, R. E. & Poynter, T. A. 2008. Organizing for World-Wide Advantage. New York: Routledge. Read More