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Radhika Panjwani is a former journalist from Toronto and a blogger.

Six years ago, Netherland natives and business partners Joost Minnaar and Pim de Morree, co-founders of Corporate Rebels, quit their lucrative engineering jobs to travel the globe in search of workplace pioneers – chief executive officers, entrepreneurs, academics and thought leaders – all of whom had the nerve to abandon traditional organizational structures and streamline their operations through innovative processes, because they believed in employee engagement.

The duo visited more than 150 organizations and found a gamut of successful and inspiring workplaces from a variety of sectors, practising a radical way of working.

“If you want to make work more fun, the organization structure based on command and control or hierarchy is not necessarily the right thing,” said Mr. Minnaar. “We found organizations where employees were really engaged in their work had flat and clear structures. Just to be clear, hierarchy and bureaucracy can be successful, but I don’t think a lot of people enjoy working in those places.”

Organizational structure is a system, often illustrated using organizational charts, to define a company’s hierarchy. Its purpose is to identify each job and function. Organizational structure ascertains how an organization operates and grows.

The two men share their experiences and insights in books, blogs and workshops through their company.

The Buurtzorg way

Buurtzorg is a Netherland-based home health care organization founded in 2006 by nurse Jos de Blok. Mr. de Blok felt the traditional hierarchical structure was hindering the delivery of effective health care because there were too many layers of bureaucracy and too little autonomy. He disrupted the existing model and built a new one focused on functionality, freedom and trust.

The organization has a network of about 1,000 self-organized and autonomous teams. Each team has 12 nurses who are responsible for a particular neighbourhood. They all are run independently, and are tasked with finding new clients, hiring, firing, planning and execution of care. The company has a head office staff of 50 people – 20 coaches, two directors and a handful of others – whose job is to support the nurses by taking care of administrative tasks so the nurses can focus on delivering care.

“Buurtzorg’s network of 1,000 teams is more than just a sum of its parts,” Mr. Minnaar said. “There are no bosses or middle managers. There’s a strong sense of community and collaboration among the teams. The 1,000 teams are connected via IT system. For instance, if a nurse runs into a specific care issue they’re unfamiliar with, they will post their query on the intranet and find the answer from their colleagues within hours.”

The Dutch company has the highest client satisfaction rating of any health care organization in the country. Staff absenteeism is 30 per cent lower and staff turnover is half of its peers, and the company’s overhead costs are 67 per cent lower than their competitors.

Mr. Minnaar says the pioneering companies he studied all had several common features. He said progressive companies are not obsessed with shareholders, instead they want to build companies around their purpose and values. The organizations all have agile teams of typically 15 or less people connected through technology; leadership doesn’t exert authority, but wants employees to thrive. The inspired workplaces are unafraid to experiment and are transparent. For example, they grant workers easy access to data, documents and financials.

Valuing human capital

All well-run organizations have hierarchies that promote the company’s culture, values and success. For the most part, organizational structures have remained stagnant and follow the top-heavy, traditional model, where a CEO positioned at the top builds a multi-layered network rife with middle-managers. This type of organizational structure has lost its spark in the technology-driven, knowledge-based work where human capital is far more valuable, as described in a blog entry on the Work in Progress site.

“There’s a mathematical calculation between increased employee engagement and increased profits,” Jeff Deckman, founder and CEO of the Successful Transition Planning Institute and author of Developing the Conscious Leadership Mindset for the 21st Century, shares in the blog. “In the industrial age, there was a hyper-focus on financial capital. However, money doesn’t make money any more than money loses money. People do both.”

Traditional organizational structures are becoming irrelevant as more and more companies today are faced with employees who are rejecting the hierarchy. While it was once sufficient for structure to follow strategy, Mr. Deckman says, “communication, collaboration and facilitation,” models where leadership empowers employees will become the norm in the 21st century.

What I’m reading around the web

  • Some 47 per cent of Googlers told the company having performance reviews twice a year was a waste of time, so the company made some changes. According to this story in The Verge, Google will transition to a new system called GRAD (Googler Reviews and Development). In the new method, employees will still check in with their supervisors throughout the year to get feedback, but they’ll only receive performance ratings once a year. The story compares the process of performance reviews in other organizations such as Microsoft and Amazon.
  • Trust is an essential currency in organizations. According to this story in Harvard Business Review, research has shown it takes a long time to build interpersonal trust in organizations. This is especially true for people who have to cross-collaborate on important strategic challenges, but haven’t worked together before. The same is true when a startup brings in new executives to help scale the business or when an incumbent organization brings in new individuals with new competences into their decision-making processes and management team. The article says a strong emphasis on trust can lead to inertia.
  • In his 25-year career, Jeff Hyman, the chief executive officer of Recruit Rockstars, has reviewed thousands of resumes and interviewed more than 30,000 applicants. He offers three strategies for writing a resume in this article in CNBC.
  • According to this story, asynchronous reality will now allow people to view their voice mails via hologram. So, say for instance, you’re at the office and are wearing a VR headset that’s set to “focus” mode, you won’t be disturbed, but when you’re off focus, you can play back a real-time contextual hologram video. Instead of showing you a text of what you missed, asynchronous reality will let you relive the moment from a first-person perspective.

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