Why Flat Organizations Make for Better Startups

Hierarchy is overrated. You'll get more buy-in from your employees if they see you working alongside instead of above them

Written by Robert Gold

Julian Bolster runs six businesses, simultaneously. Not content with that entrepreneurial workload, Bolster is also an executive coach at the Bolster Life Group, and is in the process of launching yet another venture.

Thanks to his experiences as a serial CEO, Bolster is well-acquainted with the frustrations and challenges that startup founders face as they attempt to get their ventures off the ground. Time and money are perennial concerns, but Bolster identifies two that he believes are becoming increasingly common: vision and visibility.

MORE EARLY INSIGHTS: 5 Essential Strategies of Successful Startups »

Increased competition and the looming threat of disruption have made it harder than ever before for companies to cut through the clutter and establish visibility in the marketplace. That’s particularly true for startups, who are often up against established industry players but lack the resources to out market them.

But an even bigger hurdle for many founders is getting their employees to buy into their big idea in the first place. An entrepreneurial vision and the passion to fulfill it are the basic requirements of entrepreneurship. “[But] trying to get everyone else in the company to hold true to that vision, especially when that vision doesn’t appear to be something very sexy in the moment, can be a challenge,” says Bolster.

MORE ENGAGEMENT ISSUES: Does Your Staff Know Your Vision? »

Getting buy-in is becoming increasingly difficult, because there’s a growing desire among employees to belong to something that matters. “They no longer want to work for a work-mill, for a place where they just sell their time for money,” explains Bolster. “We’re very much in the age of the startup, and I think younger employees have this very romantic idea of belonging to a company that stands for something and that is out to do something big.”

Simply having a big vision for your company isn’t enough. Entrepreneurs know they’re no slackers. As Bolster notes, there’s a perception that founders must work 75-hour weeks and forego what makes them happy to succeed—a style of functioning he believes leaves you without the energy to actually accomplish anything. But employees need to see you doing more than giving orders for them to understand how much of yourself you’re putting into the business. “The new entrepreneur has to lead with a sense of vulnerability and personal investment,” says Bolster. “They are willing to roll up their sleeves and go into the mailroom to fix a machine or start at the coffee bar serving coffee to guests.”

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Working alongside, not above, your employees is the key to engaging them. “When an organization has a flat bureaucracy, it allows [employees to] see where they fit into the whole organization,” he says. “Rather than [the vision] just being a motivational motto plastered on a poster that’s hung in some lunch room in the back of the building, you want it to be something that people can personally relate to and they seem themselves being a part of.”

In practical terms, that means decentralizing leadership. Bolster cites the example of Toronto travel firm G Adventures, which has about 15 people with the title of CEO—Chief Expedition Officer. Bolster met one of these CEOs on a promotional tour of the company a few years ago. “That individual was given the opportunity to create the role as they saw best, to go out and bring their ideas to the boardroom table, to really contribute not as an employee doing labour or work but as a thought leader,” Bolster says. “You could see the effect that had on the employees—they were personally invested.”

For more insights from Bolster, including three steps all entrepreneurs can take to overcome their frustrations, listen to this week’s BusinessCast by clicking the button above or download by clicking on the iTunes logo below:

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