Hierarchy vs. network – A new business model for success?

Hierarchical vs. Networked Business ModelsTraditional business models have relied on a hierarchy – a model in which a steady environment was created in order to maximise efficiency and productivity. However, in the new age of ‘always on’, hierarchal models can often be a hindrance to a business’s ability to be agile and innovate.

The network business model is a system for the digital age. Denoted by a flatter management structure and a change in thinking and approach to business, the network is about reaching as many people as possible in order to maximise collective knowledge and information.

Whereas the traditional model relies on control, a networked model emphasises adaptability and fluidity – prioritising the ability to change in order to survive.

Addressing the ‘always on’ customer requires a new type of business model which emphasises collaboration and universal knowledge. Businesses need to develop strategies that integrate siloed internal resources. This will trigger a  collaborative network of partners, thought leaders, brand  ambassadors, and suppliers.