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Power isn't zero-sum
Hierarchies are a powerful servant to an organizational need to streamline decision-making for a predictable world. The entrepreneurial vision—deciding markets, products, and strategies—was concentrated at the top, while the middle managed operations, and the bottom carried out tactical directives with little decision-making power. This separation made sense when organizations valued control and efficiency above all else, and appropriate given the broader economic context of the early twentieth century, when industrial giants were making new markets from scratch.
But in today’s fast-moving, complex environment, this rigid distribution of power limits innovation and adaptability. Test-and-learn approaches, for instance, often fail because the power to experiment is centralized; teams tasked with learning have neither the authority nor the resources to act.
In almost every case, centralization creates a bottleneck. Decisions at the top often take too long to trickle down to the people closest to the work, and by the time they arrive, they may already be outdated. This lack of distributed authority creates inertia, stifles innovation, and demoralizes employees who feel their contributions are undervalued or ignored.