The End of Middle Managers (And Why They'll Never Be Missed)

Last week I talked about eliminating managers. What is it like to run a company with no managers at all? I promised to cover the subject this week in more depth.

The end of middle managers - everyone leads

In my opinion, a company needs leaders—not managers. From the top down, every employee has the opportunity to lead, starting with the organization of one within the larger organization that we call “Me, Inc.” Every individual is responsible for shaping and creating their own future (with collaboration and a little assistance, of course.)
What does that look like? We start with two of our 7 Non Negotiables of leadership—we Trust and then we Empower. You know how leaders will typically say “I empower my people”—and then they don’t? The tendency is all too common. The minute there’s a mistake it’s like a rope around your neck that snatches back—you either get your head taken off, or you get yanked back so hard the natural reaction is to hunker down and become “less” instead of growing to “more.”
With my own paired leadership partner, Fishbowl president Mary Michelle Scott, we start at the top of the company with a holistic, high altitude view of what we want to achieve. Then we bring in the department captains (there are 3 pairs) and say, “This is what we’re thinking. We think it’s time to open up Canada, the UK and South Africa.”
We give that big piece of meat to the captains. They chew on it for awhile and come back with either 1) they don’t like it (generally coupled with a counter proposal), or 2) the multiple ways they see to go about achieving the goal. The captains are leaders who play a core role in the strategy’s formation. Then they run the day-to-day deployment of the strategy that’s been jointly created and set.
Yes, there’s a fine line between leadership and management—but there’s a massive difference as well, I maintain. Our approach makes the groups and leaders autonomous, but also interdependent. They are bright. All voices are heard. We decide on the “best” idea, no matter who originates it, and most of the time, we actually forget who brings the idea forward. Nobody worries about “the glory” because all will benefit as a team (my compensation strategy is here.) They come up with better answers than we could ever hope to achieve on our own.
The captains don’t “manage” every day. They have just one meeting as captains per week. That meeting determines the deployment of strategy. We hand off to the captains—then they hand off to the teams, who hand off to the individuals who deploy day to day, and then they get out of the way (as they resume their own production roles, side by side with their teams.)
At this point, our entire company is flat.  With no hierarchy, everyone leads within their areas of stewardship and responsibility.  Many will have excess capacity and offer to help another teammate or even go to another department to ask how they can help. (Yes, this really happens—in some cases, it happens every day.)
While my door is always open, my policy is simple: “Don’t come to me with a problem.” In traditional settings, it’s all too tempting for anyone to drop their problems in the leader’s or manager’s lap. I tell them, “Don’t come to me with your problem until you’re ready to come forward with your best solution, or your best set of possible solutions, as well. And did you take it to your teammates? What did they say?”
Rarely does anyone need to come forward, but when they do, it’s in a context of collaboration and sharing—not the waging of a complaint or an effort to bring their situation forward for me to step in and resolve.
Yes, there are some management components. But we try to stay away from the temptation to micromanage, which makes people so fearful of making a mistake, they feel they don’t dare to create something courageous.
As a point of reference on managing through fear, note Frederick Allen’s article last week, discussing the Vanity Fair article by Kurt Eichenwald about the all-too-common practice of the “stack review”. In this strategy, for a group of 10, for example, 2 individuals would receive an outstanding review—7 would receive mediocre reviews—and 1 would receive a terrible review.
Erika Anderson talked about the danger of this strategy in her July 6 column as well: “Human beings, like most every other living thing on the planet, thrive in response to consistent support and the removal of obstacles.  Forcing them into artificial and arbitrary constraints is generally doomed to fail.”
Erika correctly notes that “stack ranking” is just one example of “wrong-headed management”—she also cites the practice of having every department cut a prescribed percentage out of their spending, as well as the oddly traditional practice of refusing to consider job candidates who don’t have a particular scholastic or experiential pedigree (or assuming that those who do will be excellent hires). I’ve written about that concept myself, in my most popular Forbes article to date, The Case for Hiring “Under Qualified” employees. 
Could a company of our size – or larger – really survive with no managerial positions at all?
We’re all working and living in rough times, there’s no doubt. But here’s what the concept is looking like for us: Our software company (we sell inventory management solutions) is achieving 60-plus percent growth for the fifth consecutive year. In the month of June, just completed, we accomplished the best business day, best week and best month in our company’s history. For us – and perhaps for you – the concept of middle managers — or any managers at all, for that matter—will never be missed.
Perhaps a good tag line would be “Open for Leaders Only.” Could that description apply to your company too?
Additional reporting for this article was provided by Mary Michelle Scott, Fishbowl President