Can We Finally Kill

the Idea Of Leaderless Organizations?

by Greg Satell
2023 November 26th

About a decade ago, the management guru Gary Hamel wrote

a highly cited article in Harvard Business Review entitled First,
Let’s Fire All the Managers. He analyzed the success
of Morningstar, a leading manufacturer of tomato products that
operates with a flat management structure and called for other
corporations to follow its lead.
“A hierarchy of managers exacts a hefty tax on any organization,” he wrote. “This
levy comes in several forms. First, managers add overhead and, as an organization
grows, the costs of management rise in both absolute and relative terms.” The article
was created a lot of buzz and helped bolster other flat models, such as Holacracy.
Yet the “flat organization” idea hasn’t caught on. “Since 1983, the size of the
bureaucratic class—the number of managers and administrators in the US
workforce—has more than doubled, while employment in other categories has
grown by only 40%,” Hamil recently wrote. The truth is that we need managers and
trying to eliminate them is a waste of time.
Planning A Spontaneous Revolution
In the early 2000s, a series of color revolutions spread across Eastern Europe
sweeping away the authoritarian remnants of post-communist governments in
Serbia, the Georgian Republic and Ukraine. These would prove to other
revolutionary waves such as the Arab Spring. Old-style hierarchies suddenly
seemed out of date.
I experienced some of these events first-hand. I was living in Ukraine during
the Orange Revolution and managing the leading news organization in the country.
I also spent some time in the Georgian Republic and got to see many of the reforms
take place. When Hamel’s article came out, I had already begun the research that
would lead to my book Cascades and I found his ideas about flat organizations not
only persuasive, but inspiring.
I shouldn’t have. Even at the time, it had become clear that the revolutions weren’t
as successful and many of us had hoped. In Ukraine, Viktor Yanukovych had
already come to power and it would take another revolution to dislodge him. In
other countries, such as Egypt, new authoritarians would soon take the place of
those who had been overthrown.

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Yet even more importantly, I would later get to know one of the chief architects of
the color revolutions, my friend Srdja Popović, and would learn that the revolutions
weren’t leaderless at all. In fact, much of what I had experienced as spontaneous and
organic was actually very much planned, engineered and organized.
As I continued to research supposedly “leaderless” organizations this would be a
recurring theme. Either their success was either not genuine or ephemeral, or that
there was a less obvious, informal hierarchy at work.
The Truth About The Orpheus Orchestra
One of the most cited examples of successful leaderless organizations is the Orpheus
Chamber Orchestra in New York, which has been operating without a conductor
since 1972. They not only regularly play at top venues like Carnegie Hall and
Lincoln Center, but have won multiple Grammy awards.
An orchestra concert is a highly coordinated event, with many different musicians
needing to coordinate their efforts to play music according to a specific vision. If
everyone applies their own interpretation, what should be a symphony would end
up as a cacophony. So how does Orpheus manage to not only survive, but thrive?
The truth is that Orpheus is not really a purely leaderless organization. It would be
more accurate to say that the members trade off leadership, with one member
leading one particular collection and then a different member leading another. So
while it is true that the Orchestra as a whole is leaderless, each concert is leaderful.
That’s quite a big difference. If you would believe that an entire orchestra could
conduct itself, you might go and try to run your organization with no direction at
all, which would be a disaster. However, if you would follow the direction of the
Orpheus Chamber Orchestra, you would appoint a particular team member to run
each project, which would be so utterly conventional that it wouldn’t even seem
worth mentioning.
The Open Source Pecking Order
Another favorite that advocates of “leaderless” organizations like to point to are
open-source software communities. Yet once again, when you take a closer look,
these communities are not some free-for-all, with everybody chiming in and making
changes at will. In fact, in successful communities take governance very seriously.
Some projects, like Android and WordPress, are tightly controlled by the companies
that originated them, Google and Automattic, respectively. They manage the
community fairly tightly, accepting patches, revisions and improvements as they see
fit and providing a vision for where they think the technology should go.
Open source foundations, like Linux and Apache provide more intricate
governance structures. They don’t have much in the way of formal leadership, but

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 in practice each project has informal leaders who drive the direction of the
technology. In fact, competition for clout within those communities can be very stiff.
There’s a reason why some of the world’s most valuable companies pay people well
to contribute to open-source software communities and it’s not altruism. They want
to shape how crucial technologies will develop to benefit their business. To do that,
talented people need to spend time building the trust and reputation that will enable
them to lead.

Let’s Not Fire All The Managers

For a while now, management gurus such as Gary Hamel have been
advocating for flatter organizations, yet there is little evidence that
eliminating leaders is a viable model. In fact, when Wharton
Professor Ronnie Lee took a close look at game software developers, he
actually found that the number of levels of bureaucracy increased
significantly, not decreased, over the last 50 years.
There are several reasons that this is true. The first is that, while having a
flatter structure leads to more innovation and creativity, you need good
leadership and governance to execute well. As an industry matures and
becomes more complex, more levels of hierarchy are needed to manage it
effectively.
Another important factor to consider is that even without a formal
hierarchy, leaders will tend to emerge. Which is why when you take a
closer look at often cited examples of “leaderless organizations,” there is
much more hierarchy that it would at first seem. Just because there isn’t
an organization chart doesn’t mean there isn’t a pecking order.
We need to stop thinking in terms of how many levels of bureaucracy
there are and start working to network our organizations. We don’t need
to eliminate managers—or anyone else for that matter—but to widen and
deepen connections within and without our enterprise. We need to lead
and to do it more effectively.
The role of leadership in organizations has changed. It is no longer merely
to plan and direct work, but to inspire meaning and empower belief. As I
wrote in Cascades, the key to transformational change is small groups,
loosely connected by united by a shared purpose. The job of leaders today
is to help those groups connect and forge a common purpose.
Greg Satell is Co-Founder of ChangeOS, an international keynote speaker, bestselling author whose work has
appeared in Harvard Business Review, Barron’s, Forbes, Inc., Fast Company and other A-list publications, a
Lecturer at Wharton, accomplished entrepreneur, global executive and one of the foremost experts on
transformation and change today.