We live in the times of rapid changes in every sphere, and organizational structure is no exception. The creation and growth of the Internet, evolution of technology, and popularization of freelancing made the traditional framework of organizations completely outdated and unviable under the current circumstances.
Now we can observe the rise of a new model, which is highly adaptable by its very nature, so it can bloom in the constantly shifting environment. Adopting this particular structure right now can give your business an edge necessary to take over the market.
Traditional Color-Coded Organizational Frameworks
The structural framework of an organization changes along with the society. There are four traditional structures that have evolved throughout the human history:
This is the most primitive organizational model that appeared about 10,000 years ago. In essence, it imitates a wolf pack, but the establishment of this model was responsible for the division of labor and creation of command authority.
Main characteristics of the red model are:
- Absolute power concentrated in the hands of the chief
- Short-term focus
- Extremely high level of reaction to the external threat
At the moment, this structure is preserved in tribes that ‘follow the old ways’ and live on the outskirts of civilization and in the criminal environment (both organized crime and gangs).
This type of organization is military-like and currently remains the accepted model of the army and the majority of highly bureaucratic government organizations, as well as the Catholic Church.
- Well-defined hierarchical pyramid with formal roles for every member
- Top-down command structure requiring absolute control
- Repetitive actions and long-term focus
This structure is stable and predictable, which reduces its efficiency in our rapidly developing world.
This model came into being due to the Industrial Revolution and its structure resembles a machine. At the moment, this is the type of organization used by large multinational companies and investment banks.
- Goal-oriented with a focus on being the best of the best
- Defined command structure based on management objectives
This model accepts innovation and can implement it in an efficient manner. It also promotes accountability among employees.
This structure emerged due to the limitations of the orange model, which stunted personal development and required well-trained but not necessarily well-educated staff. The rise of the educational level of workers, as well as their ambitions resulted in the establishment of organizations that emphasize culture and empowerment. Many of the leading businesses today are green, such as Starbucks, Zappos, Southwest Airlines, etc.
- Focus on motivating employees through empowerment
- Stakeholders instead of shareholders
The Advent of a Teal Model
Despite their varied levels of efficiency, all the models mentioned above have a top-down command structure with the absolute power placed at the very top. Even in a green organization that promotes your ambition to become better, there is a boss that controls you.
The teal model defies this specific feature, offering an organization with a horizontal structure. It doesn’t need to encourage empowerment, because by its very nature, it empowers the members so that each of them has equal rights and opportunities.
This form of organization is highly flexible and aims to imitate a living organism. Like our body, it has ‘organs’ that are absolutely different, but no less vital. This structure can be extremely complex, but its fluidity makes it highly adaptable to any kind of changes. This makes it easy to integrate new technology and promote creativity necessary to push forward the progress of the business.
The most incredible thing about the teal organizational model is that it eliminates outside control. This boosts productivity of every member of the team because according to psychologists, having an outside locus of control increases the level of stress.
In a teal organization, every person is a leader, the one with the power to make a difference. Some companies that have already adopted this structure include FAVI (France), Buurtzorg (Netherlands), Morning Star (US), and Patagonia (US).
The Society of Millennials and What It Means for Organizations
Millennials, people born in between 1980 and 2000 and raised with technology, unlimited opportunities, and access to information are the reason why traditional organizational structures are failing today.
These people are extremely independent, ambitious, and well-educated. They simply won’t settle for having someone ‘boss them around’, and thus teal organizations are emerging to accommodate these progressive and creative professionals.
As they are used to instant gratification due to their upbringing, the work with a long-term plan of building a career isn’t attractive to an average millennial. They want to be recognized for their talents right now and get the benefits they deserve through their work. A teal model is perfect for this specific purpose.
The Values a Modern Organization Should Strive For
Whether you are just starting a business or have a well-established company with a solid position on the market, you have a chance to make it more productive. Evolving your organizational structure to meet the requirements of the teal model is rather easy when you know what changes you need to implement:
- Horizontal organizational structure.
Give every person the power to do their best and hold them accountable for their work. Focus on explaining their role in the ‘organism’ instead of forcing them into a certain mold.
- Sustainability and positive effect on society.
80% of millennials claim they would be more motivated to work with a company that makes a positive impact. As the matters of environment are relevant at the moment, being sustainable is one of the best choices.
- Employment of freelancers.
The Internet allows you to bring together and manage a team located in different countries, which allows you to find people perfect for your goals.
- No boss.
Every person must understand that they are equally important for the function of the business. Less control will enable them to achieve their full potential.
- Social benefits.
Millennials appreciate gratification, so offering versatile benefits, such as gym membership, health insurance, etc. will make your company much more attractive.
- Partnerships with other organizations.
Teal organizations are complex networks, but they don’t have to be huge. Instead of adding a department, you can focus on partnering with a specialized business that will perform the part of work you require.
Change with the Times to Stay Ahead
The changes in the society and world in general that we’ve witnessed over the last few decades are so significant, it’s no wonder the old organizational models cannot keep up. Now we have a whole generation of people who cannot and should not try to fit into the limits of those structures.
To build a prosperous business today, one must strive to build a horizontal-structure organization that accommodates the recent changes and can adapt to the new ones easily.