I'm not sure if lumping Zappos (1500 employees) with GitHub (100 employees) makes much sense. I don't believe the organizational structure has an impact until you get over a few hundred employees.
It's kind of like sports. If you are playing in a niche sport that only has 3 teams then you don't really need committees to maintain the rulebook, a referee union, a centralized body to represent the teams or a players' union.
When you're small enough everything just either works or doesn't. The owners of the company are personally involved, you feel responsible for the success and there's a great deal of transparency.
With that said I do believe most smaller companies should be flatter, and that it starts at the top, like not having a CTO, CIO, VP Technology, Director Technology, Director of IS for a 20 person company.
I don't believe the organizational structure has an impact until you get over a few hundred employees.
Disagree. There are 50-person companies with all the negatives of MegaCorps (bureaucracy, closed allocation). That stuff starts to matter around 15-20 people.
Even before you have actual bureaucracy, if the founders haven't set forth some strong statements on what they want the company to be, there will be political behavior very early on as people anticipate what might come about with growth. Titles are meaningless at 10 people, but people will still fight for them, knowing that (if the organization moves along the default "main sequence") they will be massively important in the future.
I can definitely attest to 50 person bureaucratic companies, having worked in several. I think this comes down to (as Guy Kawasaki puts it) a Bozo Explosion. Hire bad people, those people hire bad people and the politics get bad quickly.
I'm glad to see this defined as organisational structures instead of the usual "no managers" nonsense.
"No managers" makes just as much sense as "no receptionists". Whether you need them depends mostly on context, not philosophy. People tend to confuse management as job (as in a person who does certain stuff so you don't have to, just like a receptionist) with management as a tier in a hierarchical structure.
I guess this person never heard of socialist and anarchist organizational structures... What is old is new again. Except what is new is that many of these places are wrapped around with a capitalist bow where workers really don't share profits...
I have no idea how they actually do it. However if I were tasked with implementing it, here is what I would do.
Accounting: Set the ground rules about what reporting and data collection needs to be done by each team/unit/division and the business protocol. Assign qualified people to supervise.
HR: This one is easy, no HR whatsoever. Need more hands? Bring in suitable candidates you know and trust. Perhaps supervised by a quorum of peers.
Legal: I think that here you would need a liaison between the company and the legal firms.
I think that this could be a sane default, let things evolve from here.
HR is more than hiring: benefits, vacations, sabbaticals, training. Accounting would in particular have to deal with orders being made by employees and invoicing.
None of the topics you mentioned require hierarchy.
Benefits: "This is an offer I received from corp X for pension funds. Yay or Nay?"
Vacations: Take as much vacation as you feel like. If you take too much, your peers will fire you.
Sabbaticals: If you are worth it you are always welcome back.
Training: Ms Alice. Meet your mentor Bob. Bob will take care of your first steps within the company and teach you the way we do stuff around here. From here on you will have a variety of mentors for the different areas of work you will be working on. You will receive a full voice within the quorum after period X and after your peers have been satisfied with your indoctrination to the way we do shit around here.
Accounting: I don't know why orders and invoices could not be handled in the way I prescribed. There would still be an "accounting" function. Processing incoming and outgoing payments. You can't have Jack the lorry driver signing the financial reports, can you?
Neither do they require pizza. They are just functions which must be performed within a company, and their existence doesn't require that the people in charge of them have authority over, say, the programmers. I mean, the sales folk don't boss you around, nor you the accountant, right?
> Benefits: "This is an offer I received from corp X for pension funds. Yay or Nay?"
There's a bit more paperwork involved in that than just that where you live, I'm sure. There should probably be someone who knows it, and files the business-end of it. Hell, with their knowledge, they could even offer you advise about the different conditions and regulations as you are seeking pension funds and insurance!
Also, individual employees may have had agreed different terms and conditions in their work contracts that someone should deal with and keep track of them.
> Training: Ms Alice. Meet your mentor Bob.
You'll meet him at the meeting room as he arrives from Big Training Corp, Inc. We took care of the cookies and the billing, don't worry.
Also, who calls the plumber when the sink gets clogged and pays him? Oh, and somebody needs to find a new cleaner when Joe retires next month (you knew that Joe retired next month, right?)
> Accounting: I don't know why orders and invoices could not be handled in the way I prescribed.
It sounds rather hard and it's probably just something that should be handled by a few qualified people anyway as you say?
HR has a lot of laws they have to follow and paperwork to do. While you could put these functions under legal, most companies have HR separated because of the amount of work that can be done by less legally trained individuals.
Just a few other (older) examples - Gore-tex (WL Gore), Patagonia and Semco have had structures that could be described as self-organizing or "flat". 3M is another example.
If you want to learn about Semco, make sure you read "The Seven Day Weekend", not just "Maverick!", since the former gives an updated view of the business from 2004 or so.
Would be interesting to see what Semco looks like today - probably nothing like what it was in 2004.
An important aspect of the organizations you mention that isn't mentioned in the article is explicit profit sharing and co-ownership, not just options.
This is a feature that seems fairly at odds with the desires of VCs who often seem to do everything they can to dilute workers options pools. And also with wider investment market who often see employee ownership as a threat to the value of their investment capital.
I'd add "inverted", where small, cross-functional teams make critical decisions and an organizational hierarchy above them make less and less important ones.
Good stuff. Needs more work, though. Thanks Swombat!
It's kind of like sports. If you are playing in a niche sport that only has 3 teams then you don't really need committees to maintain the rulebook, a referee union, a centralized body to represent the teams or a players' union.
When you're small enough everything just either works or doesn't. The owners of the company are personally involved, you feel responsible for the success and there's a great deal of transparency.
With that said I do believe most smaller companies should be flatter, and that it starts at the top, like not having a CTO, CIO, VP Technology, Director Technology, Director of IS for a 20 person company.