The Decline but Not Fall of Hierarchy — What Young People Really Want

When I was young I called older people by their titles.  Today, students easily call me Karl, instead of Professor, unheard of in my day.  Even more surprising is that 21st century young North Americans, emboldened by the power of the Internet and social media, now have direct access to the most influential people on the continent. And this changing, among other things, how they want to be managed.

Students tweet their hockey analyses to prolific TSN commentator @BobMcKenzie, and he often engages in friendly banter. Others  chat online with British comedian, actor, and author @stephenfry, who regularly tweets jokes and talks to his followers. Following @algore is also at the top of the list in the US, as students can receive instant tweets from a former Vice President and one of the world's leading green journalists of the 21st century. Others may tweet Globe and Mail journalist Jeffrey Simpson, who responds directly to their questions once per week. And during the recent federal election, students submitted their election debate questions via online video, and Canadian political leaders responded on national television.

The result: having grown up engaging in dialogue with prominent commentators, journalists, and politicians, Generation Y wants the same at work and large companies  have now incorporated social media platforms across their organizations,  Morgan Stanley have announced they are implementing  Twitter  for employees, and internal Facebook like platforms are transforming  company wide communication and collaboration , effectively changing how work now  gets done. New hires want to engage not only with their boss, but also with their boss's boss - and their boss's boss's boss.  In other words, Postmoderns (those under 35) don't see the relevance of hierarchy all that much.

Businesses have responded to this anti-hierarchy wave, largely driven by youthful employees. Companies like Google are attracting the world's greatest technical and business minds. But Google doesn't attract the world's best based on a high salary; rather, they're attracted to the casual work environment and wafer-thin hierarchy. During lunch at a Googleplex dining hall, a rookie software engineer may be to your left, and a senior product manager may be to your right. Both will be wearing jeans, and any idea is welcome. At its best, it's that flat, and it's that relaxed.

Contrast burgeoning Google with beleaguered Microsoft, and the trend becomes clearer. Microsoft has six to twelve layers of middle managers, depending on the department. They operate in a conventional, structured environment where a junior analyst wouldn't dare commit heresy by, say, pitching a novel idea to a senior manager five levels up the pecking order. But who has become the winner between flexible Google and bureaucratic Microsoft? And  is the role of hierarchy dead in the information-based organization? Contemporary research on the importance of hierarchy appears divided,  a  recent study by researchers, at Berkeley, suggests that the impact of steeper hierarchies is mixed. But, I believe  most would say Google wins. Many would argue it's because of their relaxed and flat organizational structure which is compatible with how Generation Y's want to work.

The trend that hierarchy can hinder success is not limited to business. Several years ago, Canada's Privy Council Office commissioned David Eaves, a public policy expert, to write a report on how the Canadian public service could improve recruitment and retention of young people. His report focused on hierarchy.

Eaves believes that young, talented 20-somethings don't want to - rather, they won't - work in a nine-to-five bureaucratic job, where their ideas need to pass through chains of command to be heard. Having been raised in a world of social networks, video chatting, and instant messaging, the 'Creative Class' demands that the public service shed its layers of hierarchy. As John Ibbitson elaborated in his 2008 book Open & Shut, "Why would they want to work in a place where everyone can't talk to everyone about anything? ... If they think they need to talk to the deputy minister, they want to be able to talk to the deputy minister. They don't do bureaucracy."

Even the military, the great bastion of hierarchy and deference, is beginning to admit that the 21st century organization needs to think differently. Developments in electronics and communication equipment have had a huge effect on the way battles are fought and, accordingly, how troops are led. Command and control management is beginning to be viewed as an antiquated concept, and more consultative leadership practices and local decision-making are beginning to move into military practice.

Western education imparts the idea that if we don't have someone supervising our work, we'll fall into a dangerous state of low productivity and collective lethargy. But examples like the rise of Google show that youth flourish in an environment with little hierarchy.

From business to the public service to the military, the conclusion is profound: hierarchy is not collapsing but it is declining. All sectors need to rethink their organizational structure and work environment. The public service needs to shed its layers of hierarchy. The military needs to move from command and control practices to consultative leadership. And to remain competitive postmodern businesses need to reduce bureaucracy and facilitate engagement. 

Are there times and places where hierarchy remains an appropriate organizational approach?  Yes, for example, in times of crisis most of find comfort in the long-in-the-tooth older person who has been through this before and knows what we should do. Or when safety is paramount, few of us would argue about excessive hierarchy if we see and smell smoke in our office building and a fireman in his full regalia showed up and gave us clear commands.  What we are arguing that for this generation particularly those times and places are fewer and fewer.  The great news is that a less hierarchical approach is particularly useful when creativity and innovation is at the forefront, something that most industries are very much looking for. This summer I am writing a book with a McKinsey consultant on how to work more effectively with what we call the Postmodern Generation, this column is based on that work so more on this in the near future as we write the book and share some of thinking with you.

This column was written with Kyle Hill, a Sauvé Scholar at McGill University, which follows on the heels of a Rhodes Scholarship at Oxford.  Kyle will be starting with BCG in September, great hire BCG.

Read full article: Forbes, June 14, 2011