The CEO is usually the undisputed top of the business pyramid. But what happens below has become far more intriguing over the past decade, particularly as technology has invaded the workplace. Is it the COO, CTO, CMO or CFO? The answer, today, should be no-one. The day of the silo is dead – projects are multidisciplinary. Getting this flat structure to work, though, is a mammoth task, but 100% worth it.
When I sold my digital marketing agency WME Group to Melbourne IT, part of the success of the sale and the reason it enabled me to exit the business as early as June this year was the flat structure. This allows it to function successfully with the general manager heading up a team of experienced senior leaders who understand their roles are all weighted equally, and that they require each other to do their jobs properly.
I used the term ‘flat structure’ as it is often talked about, but it’s realistic to think of it as a circle with the CEO (or general manager, director, et cetera) in the middle. This concept takes individual silos and turns them into one large one that everyone sits inside.
The members of the senior management team surround the CEO at equal distance, none more powerful than the other. The CEO is responsible for making sure everyone understands this. Projects should either be collaborated on fully by all parties, or a lead should be agreed upon prior to starting.
Importantly, this structure doesn’t require lengthy meetings. I’m a strict believer in five- to 10-minute meetings with a couple of key people. Stand up, get to the point, agree on a resolution, and move on. Sometimes that puts a nose or two out of joint, but it shouldn’t create long-lasting damage.
Do not tolerate brilliant jerks; their cost to business is too high. – Reed Hastings, CEO, Netflix
The person who gives little initially gets little down the track. Tasks are distributed evenly by the fact that once someone has taken on a project, they generally can’t take on another without quality being affected, so it is left to another leader to grab it and make something of it.
It’s a slow road to poor internal structure and it also looks like it could be a slow one back out of it. In 2014, EY conducted a study around the dynamic between the CFO and the CMO – a classic example of two roles that often end up in a power struggle. It was particularly relevant at the time as technology provided levels of measurable data we had not seen before.
The study of 652 global CFOs found that 63% reported an increased involvement in marketing, while 33% lamented a lack of common tools and processes, and 32% believed that there was an absence of a clear set of KPIs that linked financial performance and the marketing agenda. While significantly increased collaboration was reported between the two roles, it was not indicated that it was harmonious. In fact, 31% complained about cultural differences.
The CTO has also become heavily involved in this power struggle. As technology flourished, this role became increasingly important – powerful to the extent that Oracle released a paper this year revealing that a new breed, the CMTO, had invaded the marketing space as the roles were starting to merge and the marketing position was increasingly being filled by technology-savvy team members. It also found that CMOs were influencing more than 50% of technology expenditure.
This leaves a growing or even an established business in a serious predicament if management structure isn’t addressed when it’s recognised that the old way of doing things is no longer working. It is inevitable that a business running on the traditional values of these C-suite roles will see increased internal competition between departments to take greater responsibility over multidisciplinary projects, which is virtually every project in business today. That equates to senior management spending too much time looking over their shoulder.
Installing this method of collaboration is difficult, especially retrofitting it. I built WME Group with these structures in mind. There is no perfect time to ensure a collaboration framework. It will always cause a little grief initially but will pay off down the track.
There is a wrong time, though – tomorrow. This is one of the first pieces of advice I give to business leaders who come to me for help as I look to mentor and invest in Australian start-ups.
Good people who can’t stop looking over their shoulder may be lost, but equally they are not effective. Constant doubt and infighting brings out the worst in your staff. Reed Hastings, Netflix CEO, has it right in this business climate when he says, “Do not tolerate brilliant jerks; their cost to business is too high.” Business is a team sport. The silo is dead.