UK: Don't call me sir.

UK: Don't call me sir. - Hierarchy is not dead. It has merely changed its form. The trappings of power in the modern workplace may have been toned down but the boss is still the boss.

by Fiona Jebb.
Last Updated: 31 Aug 2010

Hierarchy is not dead. It has merely changed its form. The trappings of power in the modern workplace may have been toned down but the boss is still the boss.

It's a union leader's dream. A company where staff are free to vent any criticisms of David and Andy, the chief operating officer and chairman, in a warts-and-all appraisal document which is posted up in the reception area for maximum visibility. A company where, provided she stays as long as they do, the receptionist will hold just as many shares as its founders. A company where whenever Rose, the office cleaner, has a gripe, she has no hesitation in letting David, as she calls him, know all about it.

Forget the executive office, bathroom and reserved car parking space - it seems that being a boss just isn't what it used to be. Or at least it isn't at St Luke's, the advertising agency where everyone hot desks in the open-plan office; where bosses claim they are but a service to the rest of the organisation and where more junior members of staff have in the past put their collective foot down when workloads were getting too heavy. 'People have called what we are doing "communism",' says David Abraham, chief operating officer. 'But we believe it is a liberation of people to pursue their own passionate ideas which will make people more productive.'

Abraham and his crew appear to be doing something right. The company has recently been voted Agency of the Year by Campaign, the advertising industry magazine and sister publication of Management Today. Archie Norman, vice-chairman of the Conservative Party and chairman of Asda, the supermarket group, claimed recently that the culture of hierarchy and status is now a thing of the past: is St Luke's an extreme example of the trend Norman identified? Or is it nothing more than a reminder that small groups of talented individuals will always have the option of organising themselves pretty much as they will, particularly when they find themselves in a start-up situation?

Norman, of course, is the man who claimed only ever to have written one memo at Asda, the one that famously read 'Call me Archie'. He's the man who, together with current chief executive Allan Leighton, restored the debt-laden, loss-making company to profitability. With its 76,000 relatively lowly paid members of staff, Asda is certainly a more representative and more complex experiment in organisational dynamics than St Luke's - if an equally self-conscious one. In contrast to Sir Clive Thompson, chief executive at support services group Rentokil Initial, for example, who most definitely discourages a 'subordinate's subordinate' from making any direct approach (see box below), Norman and Leighton have concentrated their energies on making themselves appear as unintimidating and as accessible to all employees as possible.

Not for them then the Reggie Perrin caricature of CJ. The fictional boss intimidated his employees by making them wait outside the door before meetings, while he recited the following mantra: 'One, two, three, four ... keep 'em waiting at the door ... five, six, seven, eight ... always pays to make 'em wait ... nine, 10 ... COME!' CJ certainly wouldn't approve of Leighton, who's so right on he calls all his employees 'colleagues' ('staff are what you get in country houses,' he says), who stresses his availability to everyone in the company, however junior, and who reckons he spends about 80% of his working life in 'colleague contact time'.

Leighton points out that Asda is not an 'egalitarian' company. Everyone has a different job to do and for some people that job is one of leadership, he explains; while anyone is free to contact him, it is upon his 217 store managers, 'the mouthpiece of the colleagues', that he most relies.

Even so, 'If anyone wants to talk to me, they can pick up the phone or e-mail me internally. I speak to four or five store managers every day and probably a couple of colleagues,' he says, in an interesting choice of phraseology. Leighton gets 15 or 20 letters a week from colleagues. 'If it comes to me, I deal with it directly. I'll either send a letter or e-mail so that they get a same-day response. Sometimes I get anonymous letters from stores and I write back to them too - my letter goes up on the store noticeboard. I probably get one of those a week, generally from someone with a grievance.' A fairly typical communication was a call a few weeks back complaining about the range of food in a staff canteen. Leighton sampled the range, agreed with the criticism and arranged for some substitutions.

Such informality and the impression it creates of egalitarianism meets with approval from Charles Hampden-Turner, co-author of Riding the Waves of Culture (see box opposite) and senior associate at the Judge Institute of Management in Cambridge. Yet to confuse informality with the end of the organisational pecking order is a mistake, he says. 'There is a lot of muddled thinking about hierarchies and the whole issue of how equally we treat people within companies. But treating someone as an equal does not mean they are an equal. Any smart person wanting the best out of a person treats them as an equal.' However informal the environment, Hampden-Turner argues that 'you can't escape from a functional hierarchy', although the more skilled the company's work, the fewer tiers of management and the fewer individual managers should be required.

If corporate propagandists often blur the difference between the channel being open and the communication being welcome, employees on the whole do not, no matter how chummy the chief executive may appear in the corporate dining room. Take 25,000-strong Microsoft, for example, the software giant where Shaun Orpen is director of marketing services, UK, four grades below chairman and chief executive Bill Gates in the reporting structure and about halfway up the overall corporate hierarchy. Like so many others, when asked about the accessibility of top managers in his company, he points to e-mail as the great communications facilitator (as if none of us had the wherewithal to write a letter to the boss before e-mail became commonplace). Yet with an employee's rather than a marketer's cap on, he paints a slightly different picture. 'The company runs on e-mail. I can e-mail Bill Gates - although I tend not to,' he says. Pushed a little on the subject, he confesses that, 'Personally I haven't ever e-mailed Bill Gates and I've been in the company for 10 years.'

Along with e-mail, open-plan offices are frequently cited as the great corporate equaliser, an impression Intel's chairman Andy Grove likes to foster, working as he does from a Dilbertian cubicle alongside his colleagues. But, says Martin Gargiulo, professor of organisational behaviour at Insead, the French business school, 'the availability of the CEO or chairman is just part of the role. Let's not be naive.'

It's not true, he says, that in an organisation of, say, 5,000 people, the door will be open and everyone will go in.

'It's just like your friends knowing that they can call you at half past five in the morning - they don't phone you just because they can't sleep.

It's more a warranty of an open-door policy than an open-door policy in itself. You'd better not go to see Andy Grove too often or you'll be in trouble.' Even if you could call him Andy when you got there.

The real point in the theoretical door to Andy's cubicle theoretically being open to anyone is that the message filters down the hierarchy so that the junior employee in the 65,000-strong company who would never dream of bothering Grove should at least feel emboldened to trouble Rob Eckelman, say, two rungs below. And the theory works, says Eckelman, Intel's general manager, Europe, Middle East and Africa. 'Most people feel that they can come into my cubicle - although half the time I'm not there.

In the course of a day I probably get half a dozen visits.

Of those, one or two will come from the most junior people who might have an idea or a question. 'Part of our training is to encourage openness,' he says, although he adds that the training is 'also to say don't come in willy-nilly'. Crucially, he argues that employees who feel their immediate manager is not giving their ideas a fair hearing are free to take the discussion to that manager's manager.

'No offence should be taken if the employee goes on up. In fact,' he claims, 'it is often seen as a good initiative.'

If the remark raises the eyebrows of sceptics who are more acquainted with office politics than with open communications, it also reinforces that most popular of employee perceptions - the knee-jerk reaction that Norman has got it wrong, that in most places the corporate hierarchy is alive and kicking, even if it is a trifle flatter than a decade ago. The trappings of power may have been toned down, but whether he expects to be called Bill, Andy or Sir Clive, the boss is still the boss. Only someone at the top would claim otherwise.

RENTOKIL INITIAL: A PLACE FOR EVERYONE AND EVERYONE IN THEIR PLACE

Woe betide the employee of support services giant Rentokil Initial who sees chief executive Sir Clive Thompson in the company car park and dares to make any contact other than a quick smile of recognition, nod or a brief 'good morning'. For Thompson is not a car park sort of a guy, nor is the company an open-door sort of a firm.

'There are some chief executives,' he says, 'who pick up an idea from subordinates by allowing a subordinate to come up to them in the car park and give them a pet idea. But I think that creates a political environment because the correct channel is not being used and because someone is then in a favoured position over someone who doesn't work on the same site.'

What is more, he believes that chief executives who do operate such a policy of accessibility are merely pandering to their own egos. 'Calling this democracy,' he explains, 'would be wrong. As far as the individual at the top of the company is concerned, it is a wonderful opportunity to exercise power like a king among his courtiers. If you want to practise true democracy, disband the management structure, have everyone report to the chief executive and vote on everything.'

Rentokil Initial, he agrees, is run along military lines, with eight layers of management between a service operative and himself. And the hierarchy is strictly observed. 'I would not phone up a subordinate's subordinate,' says Thompson, 'without that subordinate knowing, because that creates unease within an organisation.

And I would feel even more strongly about it the other way around.

I don't encourage people to pick up the phone directly to me because that is attempting to bypass their boss.'

In mitigation, however, he adds that in the course of any quarter, 100 managers three rungs down from him will present to him in the presence of their direct bosses and managers from the two rungs directly beneath them. 'I do encourage insubordination,' says Thompson. 'I encourage people to come up with new ideas wherever they come from but to go through the organisation to do it.'

WHAT'S IN A NAME? ASK THE GENERAL

True to the consultants they are, Fons Trompenaars and Charles Hampden-Turner have devised a neat little diagram to illustrate the hierarchical or otherwise nature of companies where different national cultures prevail.

In Riding the Waves of Culture, Denmark comes top for truly egalitarian behaviour while South Korean firms win the dubious accolade of most hierarchical.

UK firms are placed close to the centre, while French and German companies find themselves closer to the South Korean extreme.

'In France,' says Trompenaars, 'the power base is much more individually based, which is why it is so important that the person went to the right school. In Germany, it is the role that is so important, authority is seen as power. In France you salute the General, in Germany you salute the stripes.' But you salute.

The point is taken up by Martin Gargiulo, professor of organisational behaviour at Insead, who says that in surveys of managers attending the business school, 'France and Germany were the countries in which hierarchical notions of management have been the most important. In our surveys we asked if the boss needs to have the answer to all subordinates' questions or if the boss is there to co-ordinate the work of subordinates who know more about the work than he or she does. In France and Germany, we were told the boss needs to know everything.' Things may be changing slightly, he says, but progress is slow.

Trompenaars makes the point that formal hierarchies can nonetheless accommodate the status of the top manager with the need to solicit the views of far more junior employees. He cites the Japanese as a prime example. After all, he asks, what's in a name? Pondering on how cultures and naming conventions travel across companies with operations worldwide, he concludes: 'In the case of Microsoft, I am very sure that Bill (Gates) will be Bill regardless of the country of operation. In VW, however, I am sure that Ferdinand (Piech) is not the name that would be used wherever VW is active, just as I am sure Jurgen Schrempp is not called Jurgen even when he is in the US with Chrysler. The issue, however, is not the formal use of the name but what is behind it. I know US companies where people call each other by their first names, but the distance between them is still big.'

Then, of course, there is always the issue of in-built staff deference to the boss. Julian Richer of Richer Sounds, for example, may come across as one of Britain's most approachable bosses, but his press secretary still refers to him in conversation as 'Mr Richer'.

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