As organizations flatten hierarchies and pursue leaner operating models, often accelerated by advances in AI that promise to expand managers’ span of control, many leaders assume fewer management layers will lead to faster decisions and greater efficiency. Yet what often goes unseen is how strategy actually gets translated into action, and where misalignment can quietly take root. In this Insights@Questrom piece, Siobhan O’Mahony, Feld Family Professor in Innovation and Entrepreneurship, Management & Organizations, examines why middle managers remain essential to connecting strategy with day-to-day execution, how thinning the middle can undermine learning, coordination, and succession planning, and what leaders can do to preserve alignment, innovation, and employee engagement in increasingly flatter, more technology-enabled organizations.
Why are middle managers critical to connecting strategy with day-to-day execution, even in leaner organizations?
Strategy is often set by senior leaders which determines what the firm will do and what it will not do – these choices create competitive advantage. But strategy is enacted and carried out at lower levels. Strategy must be translated to be enacted and often its middle managers who do this. This critical work can sow the seeds of strategic alignment or generate misalignment. As managers translate strategic priorities into workstreams, they may uncover information that changes how they implement or execute on strategy. Once in practice, this can lead managers to pursue pathways that differ from those envisioned by senior leaders. Creating channels for information learned on the front lines of strategy execution to flow back into the hands of strategy makers can enable both strategies and workstreams to be revised as learning evolves. Otherwise, the organization risks misalignment: where the work being done may decouple from strategy. In this regard, middle managers can be the essential glue that either generates strategic alignment or misalignment.
What are some unintended challenges companies face when they remove layers of management?
When middle layers are thinned out, a manager’s span of control increases. In other words, each manager leads more people. AI will help managers oversee a greater volume of people and most likely managers will rely more on quantification and datafication of work to help manage this volume. This could mean increased formalization and management of quantified output with less relationality and understanding of the processes underlying work and the challenges faced on the ground. If this happens, managers oversee work at a layer of abstraction, this could foster a surface level understanding of workstreams and operations which could be problematic for future problem-solving. What is less appreciated is that when middle layers are removed, there is less opportunity structure for junior people to gain managerial experience. This can negatively affect succession planning, where fewer people gain the experience necessary to prepare for more senior roles.
When middle managers are removed, how is work typically redistributed across teams or higher-level leaders?
I just edited a very interesting paper that that explores something similar – how technical advances affect the distribution of work in robotic surgery and investment banking. When work is automated by technical advances, in a minority of cases, we see inverse apprenticeships: where junior people are more facile at learning advanced technologies than senior people and the juniors mentor the seniors! Yet this was not the dominant trend as senior level experts often avoided taking advantage of opportunities to learn new technologies and hid their learning. Senior experts were not open to learning and experimenting with next generation technical advances in front of junior people. This impaired junior people’s ability to learn new techniques. If seniors are anxious about the degradation of their expertise and block learning opportunities for junior people, I worry we will all miss out.
How does flattening the hierarchy affect decision-making speed, clarity, and quality?
Flattening the hierarchy does not necessarily affect decision making – it can still be centralized at the top levels. But in democratic organizations, where decision making is more distributed, several studies show that democratic processes can slow decision-making speed but enhance the quality of decisions. When more people are consulted and give voice to decisions, more diverse perspectives are considered and the decisions produced can be more robust to different contingencies or environmental stressors. Yet, gathering and weighing this input takes time. Francesca Polletta wrote a great book on this point called: Freedom is an Endless Meeting and the title says it all. With new ways to engage more people simultaneously through digital forums, this time deficit could be reduced. I don’t know if we have this nut fully cracked yet. There are ways to create digital participation architectures where people can autonomously navigate to forums that enable different types of contribution. I should add that an important but underappreciated benefit of democratic forms of organizing is that they help prepare people to engage more democratically in other areas of their life – in civic and political domains. When people are engaged in decisions at work, they are more likely to do the same elsewhere.
What strategies can organizations use to preserve innovation and creativity when fewer managers are in place?
The first condition organizations need to innovate is slack. When organizations are focused on operational excellence, there is very little room to court the experimentation needed to really innovate. Slack can come in the form of units or divisions dedicated to innovation (incubators, accelerators, R&D labs or corporate venture capital units). Fidelity’s Innovation Lab downtown Boston is a great example of this. Typically, these types of units have a manager, a charter and performance metrics. Innovating managers fund the experiments, prototypes, tests and trials needed to see innovation thrive, track the results and see which ideas achieve key milestones of viability – some will fail. Some firms take this a step further, allocating slack time to individuals to pursue creative endeavors on their own. 3M famously allowed employees to devote 15% of their time to pursue their own ideas or passion projects in 1948 – this led to the creation of the Postit note and an entirely new product family. Art Fry had been using a poorly functioning adhesive to mark his hymnal (as it was removable and would not damage the pages) to manage the songs he sang in his choir. When others started asking to use them, he realized it could become a product. Google copied this rule and upped it to 20%, giving employees essentially a day to work on passion projects like the creation of Gmail. This individual based approach to creating slack is a great way to empower all employees to work on innovations, but it is best for innovations that do not need much capital to succeed.
For leaders considering flatter structures, what practical steps can they take to maintain coordination, alignment, and employee engagement?
So much of the work people do is digital and it becomes invisible, buried in email. How can you make people’s efforts visible and recognize them? There are dashboards and other types of digitized project and task tracking that showcase individual efforts. These tools can create unanticipated side effects that undermine accountability when people try to “manage their numbers”. If you create ways to make collective efforts visible and reward individual efforts to those ends, people will be motivated to engage and contribute. Instead of feedback, think about “feedforward” to create alignment. How can you show people how their present efforts contribute to a future whole? How can you make their future impact on collective goals tangible or visible now? Think about the visuals created for fundraising campaigns, where people are visibly shown how their contributions further a collective goal. This can be motivating.
