In the last post about our business model, I talked about the general difference between the traditional model of business management vs. what’s known as ‘flat’ business models. I also talked a bit more specifically about how Suits & Sandals came to the conclusion of using a flat model, and our own little brand of flat business that we call the Amorphous Agency model.
As promised, this time we’ll be quickly doing an overview of some other companies - mostly huge corporations - that are using flat models. I’m also going to get into how an agency using an amorphous model can still grow without having to establish a middle layer of management.
One of the most well known electronics manufacturers in the world, the Japanese multinational corporation Kyocera, a company that’s been around since the 1950s, a company with around 70,000 employees, uses a relatively flat business model. They call it Amoeba Management. Kyocera uses the concept of an amoeba - a single-celled organism without a definite shape - to describe using the smallest element of an entity, and its ability to respond to its environment. In the industry of electronics, change in technology comes very rapidly. By definition of Moore’s Law, the processing power of microchips increases every 18 months. This means new electronics must be built every year and a half in order to stay current in the market. For extremely large corporations like Kyocera, it can become very difficult to adapt to such change, especially in implementing new business practices across the entire workforce. Rather than using a broad and tiered management architecture, Kyocera structures itself in small, agile, units that work independently on different sets of customers, while still sharing a set of common goals and strategic objectives. These individual amoebas respond to the environment of the business and the industry, and can divide, merge or dissolve on demand in order to adapt.
One example of a really interesting flat business model is the Holacracy - a style of business management most famously employed by the shoe eCommerce giant, Zappos. The management style was developed by HolacracyOne, and there’s a ton of documentation and explanation on their website, holacracy.org. Seriously, just read through that site if you want in-depth info on it, but here’s a quick rundown: It’s basically like treating your business organization as a Git repository. The company continually makes small improvements to the business as “Tensions” (or issues) arise, propelling the organization forward in a lean, agile way - sans management. That’s right. I could be interpreting this incorrectly, but it seems like a completely democratic management structure. Everyone has a voice.
Fractals: Amorphous Growth
In my last post on this subject, I went through a bit of explanation on how and why we use the amorphous model. To quickly recap: every person at Suits & Sandals is T-shaped, and we generally all have multiple roles within the business. The partners of the agency are directly engaged with the clients and work side-by-side with their teams to produce the work. Employees of the business are also encouraged to engage in high-level conversations about the management of the business. As we grow, we are also thinking about how that growth affects the workflow within the company and between the various disciplines we utilize to provide fully integrated digital strategies to our clients.
With a digital agency of 10 or less people, it is likely that the team is a diverse group of people specializing in different disciplines: eg. 1-3 creatives, 1-2 developers, 1-2 strategists, maybe 1-2 account executives or project managers, etc. Some of these people are cross-disciplinary, and the partners of the agency are most likely simultaneously managing the business and writing code, designing ads or researching keywords for an SEO strategy (much as is the case with Suits & Sandals). As the business grows, the team can then fractalize in a few different ways to accommodate that change while keeping the management tight and the workflow streamlined.
Option A is to segment out production and management into separate disciplines - each managing partner takes the lead of a separate discipline and governs that team independently, while all top-level client discussions (including interdisciplinary production work) and general business-steering are done with all partners together, and often includes the rest of the team. At Suits & Sandals, each partner is the lead of a broad category of production work: Miles is Director of Creative - he heads up all creative direction and produces much of the graphic design and has the final say on things like user experience and interface design. Zack is Director of Technology - pretty much anything that has to do with code or the way users tangibly interact with products we build is managed by him. And I (Nick) am Director of Strategy - meaning I focus primarily on conceptualization, executing and translating messages to the consumer, and analyzing/optimizing content and information architecture for the best user experience and SEO value. As we’ve been growing and adding members to the team, those members work within these disciplinary units, but often flit back and forth between disciplines to smoothly transition projects between phases of build.
For example, in a typical website design, content strategy and information architecture starts out in my department. We catalog all content to be put on the site, flesh it out into hierarchies for each page, and move into creating rough wireframes. The wireframes are then communicated between the strategy team and the creative team, polished and fully passed over to the creative team to design, which is then communicated between creative and technology to build a rapid prototype. Once the prototype is built, the project is fully passed over to the technology team to flesh out the final build of the site. At this time, the project comes back full circle to the strategy team, and the strategy and technology teams communicate together to finalize the onsite SEO, after which the site is optimized for page speed, responsiveness, security and other web performance attributes, and finally launched. As you can see, the fractalization of the company allows for amoeba-like motion within the company as production happens. As this is all happening, the partners are also operating as an umbrella managing entity, and the integration of management into the production teams allows us to quickly adapt to changes in technology and consumer needs.
For Option B, we’re going to take a look at another agency - Big Spaceship. Rather than fractalizing into separate disciplines, they build interdisciplinary teams around a single (or small set) of clients. This is reminiscent of the Amoeba Management of Kyocera - individual units that serve different customers. So with Big Spaceship, a designer, developer, strategist, analyst, account executive, and community manager all work together on maybe one of two clients. This works well for them as they’ve grown past the “boutique” agency size they once were - a space we still occupy. While I think this style of production is great, I haven’t really been able to find much information on exactly how the agency is run from a management perspective. It seems pretty flat to me, overall - but I don’t know whether or not these production teams are self-governed, or if there’s a middle-management layer between the owners of the business and the production workforce.
Either way, I think what Big Spaceship is doing is pretty admirable - especially considering in an industry where almost every notable agency is owned by enormous holding companies, they’ve stayed privately owned while still being able to work with the likes of Crayola, Adobe, GE and Google.
Final Thoughts - Staying Small
As we’ve seen, from both personal experience in running an agency amorphously for the past 3 years and from studying larger companies that are able to manage huge workforces with agility that surpasses a much lighter company with traditional business structure, flat business models really are generally more effective in technology and creative spaces. It’s awesome to see that no matter how big a company gets, it’s still possible to treat the individuals that make that company tick with humanity and let them know that they are trusted and their opinion matters. But as far as Suits & Sandals is concerned, we think staying small is our best bet.
More than anything, the right people, the right process, and an excellent product (thanks, Marcus Lemonis) will allow for a business of any size to be successful. And with our people, our process and our product - coupled with our management style - we’re able to put out really high quality work that gets results. Additionally, as we are a digital agency, it’s important to note that too many people working on a project can actually slow the project down. So we expect to probably stay below the 50 employee threshold indefinitely, yet still be able to put out the same caliber work, or better, as agencies far beyond our size.
To check out the work we’ve done with some of our clients - like Electric Lady or Still the One Distillery, for example - check out our Works page. And if you’re interested in working with us, feel free to drop by our Contact page and send us a message!