The entire workplace dynamic has changed. Workers have led the “bring your own device” movement, where employees (really the consumer market) have begun to define the technology that will be used in the workplace. The widening income gap and stock market volatility have fundamentally changed what drives employee motivation. The personal branding movement teaches everyone to focus on building her own brand and personal career path. In short, the days of the “company man” are long gone. What’s an organization to do?
Your company’s on a mission, and it needs to mobilize its leaders to adapt to fast-moving changes in the market. Who are the people that will lead the organization forward? Print your company’s org chart. Now tear it up. Shred it. Do the old crumple-and-toss, fade-away jumper into the recycling bin.
The traditional corporate hierarchy is fast outliving its usefulness in today’s business world. In its place are emerging models focused more on leaders at all levels. Today’s employees have more autonomy and freedom to develop and leverage their talents and skills in ways that demonstrate leadership, initiative and ingenuity. These are the leaders your company needs. And oftentimes, they’re not the people at the top of the pyramid.
Don’t buy it? Been hearing the “everyone a leader” mantra for years? While the concept itself isn’t new, the rapid pace of change that’s driving this transformation is. Traditionally organized and top-down managed workplaces probably won’t be able to respond swiftly and nimbly enough to fast-moving technological, economic and global dynamics. Is your company ready to adapt to a world in which about half of today’s jobs are at risk to be lost to computer automation — and where many of the jobs that will remain don’t even exist yet? According to a recent Oxford University analysis, that’s likely to be the future in the U.S. workplace within the next 20 years.
Zapping the hierarchy
Not much on predictions? Then consider the here and now for online shoe retailer Zappos. In late 2013, CEO Tony Hsieh announced the company was scrapping job titles, and doing away with managerial roles and the corporate hierarchy. Over the past year the 1,500 Zappos workers have been organized into what is called holacracy, a system of organizational governance in which authority and decision-making are distributed to self-organizing teams rather than being vested at the top of a hierarchy.
So Zappos’ org chart is in the trash — for real. And an unprecedented confluence of powerful trends and technology will drive others to follow similar paths. If you want your organization to survive and thrive in the future, looking for leaders outside the top tier of a traditional hierarchy is a path you can’t afford to ignore. A deeper dive into three overarching trends helps drive that point home.
Back in the “Mad Men” days, many established businesses enjoyed so many competitive advantages there was often scant motivation for the C-suite to cultivate a culture of leaders at all levels. Today, the Internet, social media and technological advances mean competition has become so fierce and globalized that many organizations cannot afford to cling to that old model. They need every edge they can get, and that often means leveraging the talent and intellectual capital of as many employees as possible — and doing whatever it takes to attract and retain the best talent.
A key part of effective employee engagement is empowering all employees to exercise and develop their leadership skills. The pure business case for this continues to become more compelling. For instance, in Gallup’s 2013 State of the American Workplace report, researchers studied the differences in performance between engaged and actively disengaged work units and found that those scoring in the top half on employee engagement nearly doubled their odds of success compared with those in the bottom half. Work units in the top quartile in employee engagement outperformed bottom-quartile units by 10% on customer ratings, 22% in profitability and 21% in productivity. Organizations that successfully engage their employees and customers see a 240% increase in performance-related business outcomes.
The rise of millennials
While sometimes maligned as indifferent or lazy, millennials in many ways are revolutionizing the workplace. The typical millennial mindset displays an aversion to traditional corporate hierarchy, preferring collaboration and clear communication to old-school, command-and-control approaches. Author Malcolm Gladwell emphasized at the 2012 SHRM conference that millennials are focused more on “the network” than “the hierarchy.” In that context, millennials tend to gravitate toward organizations where leadership is more about performance, professional development and collaborative skills than lofty titles or office politics.
Simple demographics suggest the millennial influence will only increase. By 2025 millennials will make up 75 percent of the global workforce, and currently they account for nearly 36 percent of American workers.
Just as social media has threatened traditional government power structures, a similar, more subtle trend is playing out in the workplace. The ability of traditional leadership to “control the message” has been diminished as technology-driven social networks have emerged. Authenticity is now valued over corporate-speak. And social networking and new communication technologies have shuffled the deck when it comes to who influences and “leads” on a day-to-day basis within organizations. Whether employees use their personal social media channels or your company-provided collaboration tool doesn’t matter: They are tapping into subject-matter experts, leaders and social influencers in ways that a typical org chart could never map out.
Getting to win-win
While change can be unsettling, it can also be the door to opportunity. HR professionals, executives and senior leaders who recognize and seek to better understand the new dynamics at work will be a step ahead. Further, those who embrace new, intelligent technologies that allow employees to develop and demonstrate their leadership skills, regardless of title, will be the new leaders of tomorrow.
Once you adopt more of a leader-at-all-levels mentality, the potential benefits for everyone in the organization begin to become clear. Both managers and employees become empowered. And as the winds of change continue to blow, you’ll see more and more form powerful alliances to propel the organization forward. Put simply, for those “in power” to remain relevant — and employed — will require a willingness to empower people throughout the entire organization. It really can be a win-win.
So go ahead, trash the org chart. Even if right now it may represent only a personal, symbolic reminder to think differently, that action can move you a step closer toward the emerging future of the workplace. A future where leaders truly exist at all levels.
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Deloitte’s Global Human Capital Trends 2014 report tells us that leaders are needed at all levels in 21st century organizations. We couldn’t agree more.