A large-scale study published in the Strategic Management Journal analyzed 1.5 million employee reviews, 42 million professional profiles, and data from more than 23,000 companies. The researchers explored whether there is a relationship between the number of hierarchical layers in an organization and the strength of its corporate culture.
Key finding
The study found a clear pattern:
The fewer management layers an organization has, the stronger and more consistent its culture tends to be.
The explanation is that strong cultures can function as a substitute for hierarchy. When employees share clear values and expectations, they are better able to make aligned decisions and coordinate their work without constant managerial oversight.
Strategic implications
For founders and leadership teams, this has important implications.
Reducing hierarchy is not just an organizational design decision. It requires:
- strong leadership
- deliberate hiring decisions
- clearly defined cultural values
Without these foundations, flatter structures can easily lead to confusion rather than agility.
Leadership and talent matter
In knowledge-intensive environments such as ERP, CRM, data & analytics and commercial leadership roles, autonomy is essential. The organizations that succeed with flatter structures are typically those with strong leadership and a clearly defined culture.
At Berger Executive Solutions, we work with founders and leadership teams to build high-performing leadership teams in these environments. Our experience consistently shows that organizations seeking flatter structures do not need fewer leaders — they need stronger ones.
Conclusion
The research reinforces an important insight:
Culture is not a “soft” factor — it is a structural coordination mechanism.
Organizations with strong, widely shared values require less hierarchy to function effectively.
The real question is therefore not:
How many management layers can we remove?
But:
How strong is our culture — really?I
Interesting article of Strategic Management journal :
