The way that modern businesses operate is evolving, with many organisations adopting quirky and unusual organisational structures to encourage a more effective and engaged workforce. This can deliver incredible benefits to your business in a range of areas, including profitability, staff retention and employee morale. However, an unorthodox organisational structure can sometimes do more harm than good to your workplace, particularly if you don’t have a clear, well-communicated framework guiding your business procedures and processes.
Some might argue that this is the case at Las Vegas-based online retailer Zappos, which embraces a very creative method of organisational structure. Under the leadership of CEO Terry Hsieh, Zappos has done away with hierarchies and eliminated managers, in an attempt to make the company a “fully self-organised, self-managed organisation”.
The move to self-govern has involved the adoption of ‘Holacracy’, a system of governance that emphasises the distribution of authority. It’s a reasonably complicated system that replaces traditional organisational charts with concentric circles of responsibility. Employees get to choose the circles they belong to and what projects they would like work on, resulting in people not having one ‘job’, but rather, having multiple ‘roles’.
Jan Klein, a senior lecturer at the MIT Sloan School of Management, says the fundamental issue with this type of leadership and organisation structure is that people don’t self-regulate as well as organisations would hope. “We’re human beings; we just don’t do that. We’re social beings and social issues get in the way of logic sometimes,” she says.
This is has been demonstrated at Zappos, where many employees became confused by the blurry leadership lines and unclear KPI’s. As a result, when employees were offered a severance package earlier this year to leave the company if they didn’t agree with its democratic new direction, a large number opted to take the deal: around 210 of the roughly 1,500 employees (14%) moved on.
While Zappos highlights quite an extreme version of an unconventional company structure, here in Australia, Microsoft is doing innovative things to maximise productivity and creativity within their workforce – with great success. Chief amongst these is managing director Pip Marlow’s mission to abandon the humble dedicated desk workspace, in favour of a bank of lockers. “I don’t have an office, I don’t even have a desk – nobody at Microsoft Australia does. We have built a new model and culture based on the philosophy work is a thing you do, not a place you go,” she says.
She developed this philosophy shortly after landing her coveted job and realising that she was “a girl living in a bubble”, as her fancy executive office created a barrier between her and her employees. Now, Marlow – along with the rest of Microsoft Australia’s workforce – simply arrives at work and goes where she’s needed most, whether that means plugging into a desk in the sales department, setting up for the morning in a meeting room or heading off-site for client interactions. This is an example of an organisation implementing an unconventional workplace structure, while at the same time embracing policies and procedures that underpin a strong sense of order.
Clear, well-documented workplace policies and procedures are essential for a healthy office environment, as they help staff to understand how an organisation ‘works’. They establish and document your organisation’s expectations, standards and responsibilities and also minimise business and legal risks.
If your workplace policies are out-dated or in need or revamping, iHR Australia can design and develop individual policies, procedures and handbooks specific to your organisation’s needs.