Whether you’re a freestanding startup or a business unit, you’re probably used to seeing charts like this:
Pretty standard stuff, right? Its primary purpose is to reflect specialization, accountability, and authority. But look at what the side effects are.
First, it concentrates power and accountability at the “top,” suggesting that flows go up and down, through the leader. in this example, the inference is that it’s the Leader’s responsibility to make sure Marketing works well with Support.
Second, it very reasonably suggests that each function is isolated from the others. If you’re in one of those boxes, you’re not in any of the others. It is VERY common – even for small ventures – for one team to consider themselves to be awesome while another team – and sometimes the whole business – fails.
And probably most important, it leaves out entire classes of stakeholders critical to daily life. Where do investors sit? Advisors? How about customers?
Now I’m not saying that hierarchical org charts are bad. Ventures are not democracies – for a reason. Hierarchies tell you who gets to decide when people disagree. But I am saying that they can often lead to unintended negative consequences – that just happen to be some of the most important organizational problems in business.
Let me give you another visual model to consider:
What if a venture were a circle? At the center of the circle is leadership, surrounding them are the teams, and surrounding them are advisors, investors, partners – and ultimately the customers themselves.
The idea here is that information flows in and decisions flow out – not up and down. This doesn’t mean that people don’t specialize or that everyone does everything. But it does suggest that each tier of the circle has a degree of connection and accountability, challenges the implied hieracrhy, and encourages people to act like a team. And everyone is represented.
Most importantly – it sets out a framework for what a venturepreneur is building. Your job at the end of the day is to build out those circles.
Next time you think about a venture, see if this model works for you. Let me know what you think.
