14 September 2020

Obsolete Managers: Flat Vs Hierarchical Organisation

Let:
N = Number of levels in an organisation
a = Entry-level age (years)
A = Retirement age (years)
T = Number of years (on average) to move from one level to the next level
Then T = (A - a)/N
Usually a = 25 and A = 60. So T = 35/N. More generally, T is inversely proportional to N.

Let P(Obs) = Probability of the managers' knowledge about the core-work becoming obsolete. Then P(Obs) is proportional to T. So P(Obs) is inversely proportional to N. In a flat organisation, N is low - so P(Obs) is high. In a hierarchical organisation, N is high - so P(Obs) is low. The conventional view is that a flat organisation is good and a hierarchical organisation is bad. But from the point-of-view of the managers becoming obsolete, hierarchical organisations are superior to flat organisations.

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