Bain Report: Upper Management’s Role could be De-emphasized

Amazon’s Andy Jassy and Jeffrey Wilke, the respective heads of its cloud computing and consumer businesses, made more than Jeff Bezos (above) last year.

While CEOs are typically considered to be the most important person in a company, there are plenty of examples of underlings being valued more than their bosses.

At least on financial terms, Amazon has two: Andy Jassy and Jeffrey Wilke, the respective heads of its cloud computing and consumer businesses, made more than Jeff Bezos last year.

But the emergent supremacy of these ultra-powerful hands is nothing compared to what’s coming.

At least that’s the view of Bain, which suggests in a new research report that rapid advances in technology will flatten company hierarchies even more dramatically.

“Teams will be self-managed, leading to a vast reduction in the number of traditional managers.”

By 2027, it predicts that professional managers won’t be considered anywhere near as important as they are today. “Teams will be self-managed, leading to a vast reduction in the number of traditional managers,” according to James Allen, James Root and Andrew Schwedel—three of the consultancy’s most experienced partners.

The cause of this gravitation away from professional managers and towards “mission critical roles” comes amid the advent of technology that is bringing companies closer to customers. And, as previously reported by Chief Executive, the creation of online communities within companies is allowing staff to more easily communicate ideas with one another, lessening the need for coordinators, such as managers.

“Becoming a more digital organization results in different work practices, different ways of communicating—and it fundamentally changes a lot of things, including the status of hierarchy,” said independent management consultant Jane McConnell.

Consider Swedish furniture giant Ikea. It succeeds by providing well designed and cheap furniture, meaning its mission-critical roles would sit in product design, to make great products, and purchasing, to keep costs down.

Spotify is among a small band of early movers to introduce revolutionary management structures that empower specialist teams, in its case of around eight software engineers, that do largely as they please without relying on much direction from on-high.

But if others were to follow in the Swedish music-streaming company’s footsteps what would that mean for the CEO role? It won’t disappear completely, Bain suggests. Someone will still have to help provide context and pull all the strings together, though how they do it could change dramatically.

Professional managers will be replaced by “formal mentors”, the reports authors predict, tasked with guiding mission-critical employees’ careers from project to project.

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Ross Kelly
Ross Kelly is a London-based business journalist. He has been a staff correspondent or editor at The Wall Street Journal, Yahoo Finance and the Australian Associated Press.

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