Organizational Design
Organizational design is the strategic structuring of teams, roles, and decision-making processes to achieve business objectives. The choice between centralized (Apple-style) and decentralized (Amazon-style) models has profound implications for product coherence, speed, and user experience. Getting this right is one of a leader's most consequential decisions.
The Guide
3 key steps synthesized from 2 experts.
Understand the centralized vs. decentralized spectrum
Every organizational model falls somewhere on a spectrum. On one end is Amazon's model: minimize dependencies so teams can run in parallel, accepting some inconsistency. On the other end is Apple's model: centrally organized around a unified vision, accepting slower speed for coherence. Neither is inherently better - the right choice depends on your product and market.
Featured guest perspectives
"On one spectrum, you have something like Amazon... minimize dependencies so you can run in parallel... On the other spectrum, you have something like Apple... centrally organized by something that is close to single individual."— Gustav Soderstrom
Consider returning to a functional model
When complexity becomes overwhelming, sometimes the answer is to simplify radically. Going back to a functional model - organizing by discipline (engineering, design, product) rather than by product line - can restore startup-like agility. This often requires removing management layers and eliminating roles that exist just to coordinate.
Featured guest perspectives
"We went to a functional model. We went back to a startup."— Brian Chesky
Eliminate people managers who don't know the work
Restructure roles so that managers are deeply embedded in the actual work their teams do. 'People managers' who exist only to coordinate and don't understand the craft create information loss and slow decision-making. Leaders should be practitioners who can guide the work, not just facilitate it.
Featured guest perspectives
"We went to a functional model. We went back to a startup."— Brian Chesky
Common Mistakes
- Copying another company's org structure without understanding why it works for them
- Adding coordination layers instead of removing dependencies
- Optimizing for individual team speed at the cost of overall product coherence
- Keeping managers who can't do the work their teams do
Signs You're Doing It Well
- Teams can ship without waiting on other teams for most decisions
- Your product feels coherent to users, not like a collection of disconnected features
- Managers can step in and do the work when needed, not just manage process
- You can explain why your org structure is right for your specific situation
All Guest Perspectives
Deep dive into what all 2 guests shared about organizational design.
Brian Chesky
"We went to a functional model. We went back to a startup."
Gustav Söderström
"On one spectrum, you have something like Amazon... minimize dependencies so you can run in parallel... On the other spectrum, you have something like Apple... centrally organized by something that is close to single individual."
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