Are more approvals required in your company than your main competitor?


In 1944, the United States’ Office of Strategic Services (O.S.S.) — forerunner to the C.I.A. — wrote a field manual for agents tasked with sabotaging enemy organizations in the name of American national security. Among its recommended strategies? Complication. The O.S.S. encouraged saboteurs to “insist on doing everything through channels”; and “never permit shortcuts to be taken in order to expedite decisions”; and “see that three people have to approve everything where one would do.”

What was a wartime maneuver 78 years ago is now just a typical weekday for most of us. And after interviewing thousands of employees and leaders across the world for my book Why Simple Wins, I’ve come to understand how even the most nimble companies devolve into tangled webs of complexity.

Here’s a two-sentence explanation: As an organization grows, teams proliferate and layers accumulate, increasing the distance between leadership and the frontline. Ideas and decisions slow and stall in every direction, decreasing productivity and innovation. According to Harvard Business Review, adding a manager creates about 1.5 full-time-equivalent employees’ worth of new work. In other words, the work of your newly hired manager plus 50% of another employee’s work responsibility.

A proven antidote to complexity is de-layering — as Bain & Company refers to it — which flattens your org structure to reduce complexity and improve efficiency. While de-layering may seem daunting, you don’t need expensive consultants to identify areas of opportunity. For reference, truly agile companies typically have only three management layers and even the largest ones shouldn’t have more than six. Look at each org within your existing reporting structure and honestly answer the following questions:

· Are there any redundancies? If so, where?

· Are employees siloed?

· Are more approvals required in your company than your main competitor?

· Could you increase the range of control for certain roles and functions without overwhelming employees? If so, where?

If you answered “no” to every question, congratulations: You can stop reading here. But if you replied with at least one “yes,” deep dive into that trouble spot. For example, if you see evidence of organizational siloes, consider whether leadership is failing to communicate a shared vision — and how to quickly address this oversight. Likewise, if approvals are a known source of bureaucracy, review workflow charts or accounting rules around expenses (or both) to identify both bottlenecks and opportunities to streamline.

De-layering in action can be seen in U.K. supermarket Tesco’s controversial decision in 2018 to flatten its org. The initiative was designed to “remove complexity and “deliver a simpler, more helpful experience for colleagues and customers.” Fast-forward to February 2022, when industry data showed the once-lagging Tesco now continuing to outperform its major rivals.

Battling complexity isn’t easy. But with an org structure that encourages communication and accountability, you’ll be well-positioned to keep it at bay. And when your entire company takes a simplified approach to operations, you can focus on beating the competition — instead of being sabotaged by complexity from within.