A horizontal organization, also known as a flat organization, is one in which there is little-to-no emphasis on hierarchy and seniority. Horizontal organizational structure examples include those in which communication is constantly moving between all parts of the organization and all members of the organization are seen as equal. This is also an organization in which power is distributed more evenly among people. As such, in the purest horizontal organizations, there are no job titles, managers, executives or seniority.

There can be problems with flat organizational structures because they can be difficult to implement and hard to conceptualize, particularly in large, traditional businesses. In a flat structure, people are not told what to work on, but instead choose what projects to participate in.

Within the structure of the organization, projects can only be started by employees who know how to take the initiative.

It is the employees who are responsible for winning support, including funding and personnel, to work on the projects they’ve conceptualized.

Advantages of Horizontal Organization

When it comes to discussing the advantages of horizontal organizational structure, the benefits are typically limited to smaller, less complex organizations. An example often used to exemplify flat structure is Valve, a software developer in which employees can freely move between projects and initiate projects of their own. Employees have a great deal of autonomy and freedom that can make their work fulfilling.

Disadvantages of Horizontal Organization

Though there are some benefits to a horizontal approach, there are also several problems with a flat organizational structure. These problems are particularly pronounced among larger organizations. As an organization grows, the lack of structure in a flat approach can make operations confusing. When a business begins to employ thousands of employees, it becomes less feasible to allow each employee to make their own decisions regarding what they want to work on.

Also, regardless of the ideals held by a company using a flat structure, it is inevitable that informal hierarchies will develop. Inevitably, those with greater experience tend to be informally viewed as seniors even within a flat structure. Despite the fact that these people are seen as senior, there is no formal structure to which employees can be held accountable.

Since nobody has to report to anyone, inexperienced and less reliable employees can cause a breakdown in operations.

Other Types of Organizational Structure

Besides the flat structure, there are three other alternatives commonly used in organizing a business’s operations. The most common type of organizational structure, a functional structure, is one in which the organization is divided based on specialties.

Sales departments and customer service departments are only two examples of how an organization divides its operations in a functional business structure, with each department having its own reporting lines by which they are held accountable.

A divisional structure occurs when a company divides itself between brands. Gap Inc., for instance, operates Gap, Old Navy and Banana Republic, with all three brands forming the same company. Similar to a functional structure, each brand within the company maintains its own reporting lines.

Finally, a matrix structure is one in which employees have multiple people to report to, such as both divisional and project managers, as well as multiple reporting lines. The complex nature of this type of reporting makes it difficult to implement in already complex organizations.

There is no one best organizational structure. Instead, each business has to consider its own circumstances. While a flat structure may be appropriate when a business is smaller, a larger organization may need the more rigid functional structure with established accountability systems in order to perform optimally.