In hierarchical workplaces, everyone knows who’s boss. Employees might be encouraged to feed into decision-making processes, but ultimately either a single figure or a small body of people seen as the most qualified or deserving of decision-making power call the shots. Whether it’s a simple top-down management system or more complex cross-project teamwork, there’s a clear understanding of where everyone fits into the hierarchy, and how much authority they have.
Hierarchical workplaces can go from a simple employee-employer structure to complex networks of interns, employees, managers, associates, shareholders, and any other title the company can come up with to divide up the structure of how everyone fits together in the workplace. In a top-down line management system, the owner or CEO makes the decisions and allocates tasks to staff or volunteers.
Managers in a hierarchical workplace often have a lot of power over the direction of a firm, largely because of the amount of information they have access to about the way it functions. Managers might also just own the firm directly, rather than be listed on the stock exchange. This can create a situation of moral hazard, where a manager knows more than the employee or customer by nature of their position, and can abuse that pretty easily.
In a departmental model, decision-making is slightly more devolved to specialised departments, though there might still be an overseeing board making sure the different departments are working in sync. In a decentralised matrix structure, people are specialised by task rather than by area, and projects take place across different departments as people manage a specific aspect of a whole range of projects. Team cooperation is much more important in this case because everyone’s responsible for their own part of a lot of different projects, rather than feeling responsibility for one whole thing.
A hierarchical structure is quite often replicated in the structure of the workplace itself. Those at the top will demonstrate their status via, for example, the location of their office or the colour of their uniforms. Often the incentive to ‘work your way up’ a company literally means that as people get promoted, they go up a floor in the office building. The idea is that the hierarchical structure reflects where we are in the economy of our workplace, and motivates us either to move up, or to protect our high status if we’re already there.