The management structure prevalent in any organization paves the way for many elements, which are part of obstacles, growth patterns, and other variants down the road.
One such management style has essentially dominated workplaces throughout history, especially in American businesses. This management style is the Top-down approach.
However, with shifts in the economy and work culture in recent years, more companies can be seen to be adopting a bottom-up management approach.
But what are the two?
In this post, we will discuss all things top-down vs bottom-up approach, explain the two approaches in detail and what your organization can gain and lose from adopting each approach, as well as discuss how to choose the right approach for your organization and employees.
So, without further ado, here is everything you need to know about the top-down vs bottom-up approach to management.
What is a Top-Down Approach?
The top down approach to management, also referred to as autocratic leadership is the type of management that is commonly applied to different types of organizations throughout multiple industries.
This type of management is hierarchal and involves the Chief Executive Officer or higher management setting the course for the whole organization. These individuals reach independent conclusions that are meant to change or improve the system in your business.
Their leadership and decisions are then carried out through to a succession of executives, then middle management, and finally these decisions, goals, projects, or tasks are communicated down to teams and individual team members.
In such types of management, everything is determined by upper management. This includes decisions about the workplace to things about business systems.
These decisions are passed from the upper management down through the chain of command.
Such management means that each individual is responsible for carrying out the roles and missions that were decided by people in higher management.
The top down approach leaves little room for comment or criticism from individuals who are running these tasks or roles.
Examples of Organizations and Companies That Use the Top Down Approach
As we mentioned previously, the top down approach is one of the most common management approaches that is followed in many organizations.
It is a common approach for management for companies that follow a hierarchal structure, that is, a chief executive officer as top management, then middle management, to be followed by team leaders who direct their individual teams and team members.
In each of these examples, the people who lead the companies have strong personalities, no matter people’s opinions of these leaders, such personalities allow for a successful top down approach to be followed.
Advantages of Using Top-Down Management
The top down approach to management is popular for good reasons. The approach is widely utilized across many industries because of the benefits it provides organizations.
Here are just some of the perks you can benefit from when using the top down management approach.
1. Decreased Risk in Decision Making
The first benefit is that since the higher management or chief executive officer is responsible for making the decisions there is decreased risk in these decisions.
Higher management refers to those individuals who are most informed and knowledgeable about the organization. This knowledge decreases risks in the decision-making process that may have otherwise been made if such knowledge or information was not available.
2. Top Down Approach Leads to Strong Management
Following top down management, upper management will be able to determine what are the best practices that will allow the company to reach goals more efficiently and make decisions to reflect this. They will make decisions and enforce the, at the highest ranks of the organization.
At any point that immediate changes need to be made is also made easier. Such decisions can be seen to be slower in decision-making processes involving lower-level employees in comparison.
3. Minimizes Costs
With higher management being responsible for creating and deciding company goals, lower-level employees such as individual team members have the freedom to complete and focus on their tasks which are unique to their roles.
Such employees are not weighed down by the responsibility of setting organization-wide goals. They can thus focus on their own responsibilities and tasks.
4. Better Organization
When tasks are determined and filtered down through the company hierarchy, having been decided by the higher management, there is no confusion because all the goals are set by these individuals in higher management.
Thus, the goals and tasks will not be affected by outside opinions, since they are all coming from the same source.
Disadvantages of Using Top Down Management
However, as is true with everything that has benefits, there are also disadvantages of adopting this approach to management.
Here are some of the cons of the top down management approach.
1. Seen as Dictatorial
As this approach towards management limits comment or criticism from lower-level employees and involves higher management putting forth goals and responsibilities, this approach has often been seen as oppressive or dictatorial.
Employees are not part of decisions or the process to come to them.
2. Limits Creativity
With decisions being in the hands of higher management, employees are unable to provide to the overall goals of the company. They are often siloed in their responsibilities which can curb creativity.
Such a structure also can be seen to lead to frustration as well as lack of motivation since employees feel their opinions are not being heard, as they are not contributing to the overall company’s decision process.
3. Response to Challenges can be Slowed Down
Although we mentioned that such an approach benefits organization in the sense that there is a decrease in the risk of decision making, there is also a drawback when following this approach in the decision-making process.
Since the decision-making minds are limited, at times it may take longer to come to a solution than if you were to allow other individuals to help solve the issue at hand. Sometimes, two heads are better than one, and that which the higher management may not be able to think of maybe conjured up by a member of a team.
What is Bottom-Up Management?
As we promised, this is an article about top-down vs bottom-up management approaches. So, let’s shift our focus to the bottom-up style of management.
As mentioned, there has been a shift away from the top down approach with more organizations and companies trying to adopt a bottom up style.
But what is bottom up management? And why is there a shift?
The bottom up style hones from the idea that talent can be held by anyone. There could be a lot of talent in the ranks that, if the top down approach were to be followed, would be missed and wasted.
Another reason for the shift towards a bottom up style is the personalities of the leaders in the organization. If the leadership is not skilled or knowledgeable enough, or for whatever reason, cannot lead decisively, the top down approach will not work.
Bottom up style follows a structure where the organization or company as a whole is involved in the process of leading said organization.
The approach follows a collaborative method and allows all the employees to contribute towards the overall goals and objectives of the organization.
Such an approach uses the unique perspective of the employees from the front lines to favor the goals of the organization.
In the bottom up style of management, teams are created autonomous and formed with skills and experiences into consideration. The teams in such an organization are self-directed and rather than relying on orders received, they decide the best way to accomplish their responsibilities and tasks.
Examples of Organizations and Companies That Use Bottom-Up Management
Compared to the top down approach, there are fewer organizations that are following the bottom up management style, although there is a shift and more and more companies are adopting this style, even if just in the way they approach projects rather than the entire organization.
Advantages of Using Bottom Up Management
Here are some of the benefits that your company can gain from adopting the bottom up management style.
1. Increased Company-Wide Communication
With bottom up management, each employee is actively participating in the decision-making process.
With this involvement of all the employees, overall communication between the members company-wide will increase.
2. Easier Problem Solving
Unlike the top down approach, when a problem arises, and the company is following the bottom up style, a variety of opinions and experiences go into coming up with the solution. This can help come to solutions more quickly and find more efficient solutions.
3. Increases Employee Morale
Since company-wide decisions and goals are a collaborative effort and thus each employee will feel included and valued.
This inclusion allows for an environment that is supportive and communicative. This inclusion also allows employees to feel motivated to work towards reaching the company’s goals.
4. Increased Collaboration
The company as a whole in a way works together, thus employees from all levels of the organization come together to discuss problems that arise. They can work together to come to an efficient solution, and thus build trust across departments and again lead to that increased morale as well.
Disadvantages of Using Bottom Up Management
The bottom up style, much like everything in this world, is not all good and has its share of disadvantages.
Here are some disadvantages you may face if your organization were to adopt bottom up management.
1. Inefficiencies in Creating Plans or Reaching Goals
While two minds are better than one, it is also said that too many cooks spoil the broth. When every employee, each of whom has varying ideas and opinions, contributes to the decision-making process there can be disagreements or conflicts that arise.
Such conflicts can lead to delays in creating plans or reaching goals which can cause inefficiencies.
2. Increased Responsibilities on Employees
The responsibility of participating in larger decisions adds to the roles and responsibilities that employees already have.
This additional responsibility can sometimes take away from employees’ other tasks or from projects they are working on, which can cause delays in deliverables.
3. Inaccurate Reflections of Data
In the long term, a variety of people that are contributing to the same projects simultaneously can cause inaccurate results and lead to inaccurate decisions.
Top Down vs Bottom Up Which Approach is Best for Your Organization?
The decision of which approach, or the top down vs bottom up decision, can be very confusing what with both styles offering different advantages and disadvantages to your organization.
So, which approach is the best for you?
Remember, each company is unique and comes with its own culture that needs to be considered when making any range of decisions.
Certain considerations may help you to conclude:
- How is goal setting implemented in your company?
- Do employees of all levels feel connected to the company’s overall mission and goals?
- What level of ownership do employees have over their work and responsibilities?
- How does leadership communicate with their teams?
These questions can point you towards the management style that could best suit your organization and its needs.
On the other hand, you may also find that a blend of the two is what works best for your organization. A mix of leadership deciding top-level business goals, with personal goals being determined by teams in a bottom up style.
Mixing the two styles can allow you to gain benefits from both while avoiding some of the disadvantages associated with each style.