Why is hierarchy important in an organization

Even if you have a flat organization with no managers, you need some kind of accountability built into every team.

Some business owners do this by focusing on the team as a group of equals, and they select one leader to take charge but with no authority. Give each employee a list of individual performance measures in addition to their team's performance measures.

Delegate some authority to the team leader, who needs a reason to motivate a team of equals, according to MindTools. Just as workers spend many years in the hierarchical environment of school, writes John Coleman on the Harvard Business Review Blog Network, they may enter the workforce with a concept of being the boss or following orders.

Coleman points out that "even the most senior people in organizations can't rely solely on hierarchy For example, you can rely on the vertical chain of command so that you can communicate your decisions clearly down the ranks and throughout the company. You need less emphasis on the vertical hierarchy of authority when you want employees to work as a team. When someone becomes a manager, she must prove to be competent, or else she will experience employee turnover.

The hierarchy of authority in an organization is important to the sustained success of the company. Managerial accountability in the hierarchy of authority should not be used to point fingers and accuse staff members of being incompetent. A clearly defined hierarchy creates a path of accountability for every project and activity within the company.

For example, an accounts receivable associate reports to an accounting manager, who reports to the operations manager. If the accounts receivable system is consistently reporting erroneous information, then you can follow the hierarchy of authority to determine who is responsible for the errors. Breadcrumb Home Guides Grow your business Leading staff through growth Hierarchical organisational structure.

Business organisational structure Hierarchical organisational structure. The two most common arrangements include: a flat organisational structure a hierarchical organisational structure Each structure has its advantages and disadvantages. How does a hierarchical organisational structure work? What are the advantages of a hierarchical structure? A hierarchical structure can provide benefits to businesses. For example, it can help establish: clear lines of authority and reporting within the business a clearer understanding of employee roles and responsibilities accountability for actions or decisions at different management levels clear career paths and development prospects which can motivate employees opportunities for employees to specialise and develop expertise in their field close supervision of employees through a narrow span of managerial control a culture of loyalty towards teams, departments and organisation as a whole What are the disadvantages of a hierarchical organisational structure?

Common disadvantages of hierarchical structures include: complicated chains of command which can slow down decision-making inconsistencies in management at different levels which can impede work delays in communicating vertically through the levels and horizontally between teams less flexibility to adapt and react to environmental and market pressures disconnect of employees from top-level management a strain on the employee-manager relationship due to lack of autonomy difficulties collaborating outside of the team 'silo' or dealing with team rivalry considerable amount of corporate overhead to support the many management layers Generally, tall organisations are very complex.

Printer-friendly version. The head instructs the various body parts on how to move and react in unison to perform the simplest of tasks.

In a company, this hierarchical decision making flows from the top the head of the organization down to employees who perform various tasks. Management is responsible for making the decisions that allow the company to function efficiently to achieve company objectives.

In large corporations, there are three levels of management: top level, middle level and first level. Generally, top-level management, often referred to as senior management or executives, sets the goals for the entire organization, directing the company on how to achieve its objectives.

Middle-level managers fall below top managers and often include titles such as general manager, regional and divisional managers.