Your hierarchy is your strategy

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Every employee in an organisation has insights that can inform strategy. They have a direct line of sight on customers’ needs, internal processes, and can help find new pathways towards success. But tapping into this potential isn’t easy. It requires a close examination of organisational hierarchies, the role of leaders within them, and how information travels up and down the corporate ladder.

The textbook approach is hierarchical: develop a strategy at the C-suite and rely on employees to execute. But, based on insights from several experts at McGill University, this can leave the organisation vulnerable to strategic blind spots and missed opportunities.

The hierarchical view is amplified and incentivised by toxic masculinity among some top executives. “Macho” approaches to leadership leave leaders blind to the emotional currents that drive their own and employees’ behaviours. And this lack of emotional awareness can prevent leaders from connecting and tapping into employees’ strategic potential.

Instead, through emotional awareness and listening, a bottom-up approach to strategy sees employees as more than executors of a vision; they’re strategic collaborators.  Such a perspective can inspire new and exciting strategic directions. And, in its most radical form, it can be an opportunity to shape an organisation according to a new set of values – a chance to be the change they want to see in the world.

Bottom-up strategy

Henry Mintzberg is a professor of management at McGill University. He’s also the author of several influential management books. In a Delve podcast interview, he explained how every member of an organisation – from the C-suite to the factory floor – is capable of having profound strategic insights. If leaders make space for everyone’s perspectives, they can help push their organisation into new and surprising directions.

For Mintzberg, it all comes down to “strategic moments,” where a person identifies an opportunity that no one else can see yet. It’s easy to save this kind of strategic thinking for the higher-ups, but there’s no reason we have to, he said. Strategic thinking is a skill that anyone can possess and use to bring value to an organisation.

“They’re open to ideas that come up that are quite unusual, which is similar to any perceptive person,” said Mintzberg on the Delve podcast, referring to people who are adept at strategic thinking. “They’ll see something and say ‘wow, what an opportunity that no one else sees.’”

Organisations have found great success by engaging with their employees and empowering them to share their ideas. In 1953, IKEA catalogue manager Gi  llis Lundgren had a strategic moment that changed the landscape of the home furniture industry. Trying to fit a table in the back of his small car, he became frustrated. That’s when he realised: why not take off the legs?

What ensued was a dramatic shift in IKEA’s strategic direction. If Lundgren struggled to load a table in his car, IKEA’s customers must struggle, too. He quickly became a tireless advocate of selling unassembled furniture in flat packaging and convinced Ingvar Kamprad, the founder of IKEA, to make this a central part of the company. Over the next half-century, flat packing would help turn IKEA into a global leader in home furniture.

This strategic victory did not originate in a boardroom. It came from a motivated employee who had a strategic moment and was empowered to share his ideas.

Getting emotional

Strategy can come from anywhere in an organisation, but it takes emotional work to access it.

Quy Huy is a professor of management at INSEAD. In the 1990s, he began publishing research on the role of emotions in the workplace. He found that, among C-suite executives, there was a “macho” approach to leadership. They would place value on “masculine” traits, like being tough and suppressing emotions, to make decisions they thought were rational and unbiased.

Not much has changed since Huy began writing on the subject.

“Emotions have always been viewed organizationally and from the strategy perspective as highly undesirable,” said Huy. “People who have emotions are perceived as irrational, they are saboteurs, they are destroying the organisation.”

When leaders adopt this view of emotions, it hurts them, their employees, and their strategic potential.

Indeed, the pursuit of sober-minded decision-making is a noble one. It’s better not to make big decisions when in extreme emotional states. But internalising stress and emotions can lead to severe mental health effects down the road. And more than that, those who don’t pay attention to their emotions are less attuned to others’. This emotional blindness can be detrimental to any attempts at strategic change.

“Emotions are fairly common, and fairly shared in the collective,” said Huy. “If we all feel sceptical or angry about change, and I know you feel the same way about the change, we are going to attack it together.”

For Huy, collective negative emotions can make staff resistant to changes imposed by management. It’s important for leaders to recognise the collective mood of their staff, to ensure that everyone is pulling in the same direction, so they can effectively execute the desired strategic actions.

Professor Quy Huy’s view on emotions speaks to the importance of listening to employees and understanding where they’re coming from. For Huy, this can help management deploy strategy more effectively by uniting everyone towards a common goal.

This kind of listening isn’t just about executing strategy – it creates the conditions for employees to help create strategy. Workers are more likely to share their strategic insights if they feel their employer cares about them.

Care, emotional awareness, and connection with employees up and down the hierarchy can thus be powerful strategic tools. Understanding employees’ emotions helps leaders better address employees’ needs, so they feel more motivated to work together and contribute strategic insights. And in return, leaders unlock new perspectives from across their organisation that can help set it up for success.

Being the change

Professors Quy Huy’s and Henry Mintzberg’s approaches to strategy involve opening up to others, viewing employees as valued collaborators, and allowing communication between all levels of an organisation. This is in contrast to traditional, top-down management styles, where higher-ups prescribe strategy and employees are expected to execute it.

For Saku Mantere, professor of Strategy and Organisation at McGill University, organizations that eschew hierarchy in favour of a more egalitarian approach may be engaging in a kind of prefiguration – adopting and acting on values that they wish to see in the world. Some NGOs and social movement organisations in particular have started questioning the age-old adage that hierarchy is a universal means to whatever ends, be it money or values-based.

“The way an organisation approaches hierarchy reflects values and identity, shared in that organisation,” Mantere said.

A tech founder with humanist and egalitarian beliefs may choose to structure their company accordingly, focusing on empowerment and attending to employees’ needs.

Twitter, before it became X, stands out as an example here. Jack Dorsey, one of the platform’s cofounders and former CEOs, viewed Twitter as a place for people to connect and understand each other (despite the platform’s shortcomings and controversies). And this worldview permeated throughout the organisation, where employees were treated to an endless supply of snacks, flexible hours, and other perks. Dorsey also famously had a hands-off approach to management, met every new employee, and focused on empowering them to build their own ideas.

Dorsey’s management style fell short of completely rejecting hierarchies. He still understood himself as a leader and stepped in when necessary. But he came close. And his approach raises questions about what hierarchy is for and who it’s meant to serve.

Learning from anarchism

The furthest we can go from hierarchical organisation is anarchy: an organising principle which  eschews stable bases of power. As a concept, anarchy, or “anarchism,” conjures images of broken glass and fists in the air. But it’s also a robust political philosophy that challenges societies to rethink the relationship between people and institutions. It’s a radical form of democratic governance, founded on constant renegotiation of shared rules and positions of authority.

Professor Jayne Malenfant and PhD candidate Hannah Brais, both from McGill University,  explored how anarchist principles could help improve public services such as education and child welfare services. For them, hierarchies often serve the status quo, baking in inequities that harm vulnerable people. Anarchy is then about putting the relationship on equal footing, so that organisations better meet the needs of individuals, regardless of their background or socioeconomic status.

“To me, it’s about how we unlearn and relearn different ways of making decisions together,” said Malenfant in a Delve podcast interview.

They acknowledge that hierarchies aren’t going to disappear overnight. But adopting some anarchist principles might help organisations better serve people inside and outside of their ranks.

This, for Brais, requires bravery.

“It might mean engaging with other people you’ve never engaged with before,” she said. “When maybe the hierarchy that you operated through to get your own sense of security didn’t ever value that person.”

Rethinking the hierarchy

Hierarchies, and the interactions that exist within them, can have profound strategic implications. Managers who are attuned to their own and their employees’ emotions can effectively unite them towards a strategic goal. And this emotional awareness can create conditions that allow employees to bring their own strategic insights to the table, opening the organisation to exciting new opportunities.

And this raises questions about what hierarchy is for, in the first place. If every employee is capable of strategic insights, why not put them on equal footing with organisational leaders? In that spirit, one might opt to reject hierarchies altogether, embodying an anarchistic approach that prioritises egalitarian values above all else. This would be unconventional, to say the least. But it would be a strong statement against traditional top-down structures that are so pervasive in other bureaucracies.

Short of abandoning hierarchies altogether, leaders can empower their employees in other ways. But to do it well, organisations and leaders must guard against inauthenticity. A teacher won’t care about sharing strategic ideas if they can’t get pencils for their classroom. Neither will a warehouse worker if their salary barely covers rent.

If managers are preaching inclusivity and connection with their employees, they also must account for the employees’ personal interests. Otherwise, they risk losing the very participation they were hoping to capitalise on.