Valve was supposed to be a bold new experiment in the structure of the firm. It was heralded as the logical next step in the evolution of the open office, the cooperative, the startup.
How did it go so wrong?
One answer is partially provided by Varoufakis own assessment of Valve:
There is one important aspect of Valve that I did not focus on: the link between its horizontal management structure and its ‘vertical’ ownership structure. Valve is a private company owned mostly by few individuals. In that sense, it is an enlightened oligarchy: an oligarchy in that it is owned by a few and enlightened in that those few are not using their property rights to boss people around.
But what if the “enlightenment” is nothing more than a Big Lie?
In 1970, American feminist and political scientist Jo Freeman wrote the seminal paper The Tyranny of Structurelessness. She observed that the women’s liberation movement, in fighting the power structures that held women back, turned to supposedly leaderless movements. But to achieve anything of import, inevitably some sort of groupings had to form — bringing with them rules, hierarchy, values of their own. What “structurelessness” had done was to render them hidden:
This means that to strive for a structureless group is as useful, and as deceptive, as to aim at an “objective” news story, “value-free” social science, or a “free” economy. A “laissez faire” group is about as realistic as a “laissez faire” society; the idea becomes a smokescreen for the strong or the lucky to establish unquestioned hegemony over others. This hegemony can be so easily established because the idea of “structurelessness” does not prevent the formation of informal structures, only formal ones. Similarly “laissez faire” philosophy did not prevent the economically powerful from establishing control over wages, prices, and distribution of goods; it only prevented the government from doing so. Thus structurelessness becomes a way of masking power, and within the women’s movement is usually most strongly advocated by those who are the most powerful (whether they are conscious of their power or not). As long as the structure of the group is informal, the rules of how decisions are made are known only to a few and awareness of power is limited to those who know the rules. Those who do not know the rules and are not chosen for initiation must remain in confusion, or suffer from paranoid delusions that something is happening of which they are not quite aware.
The feminist activism movement of the 1960s chose to purposefully reject imposed structures because it viewed them as part of the toolkit a patriarchal and misogynistic society used to oppress women. It was thought that by eschewing structure itself, the movement could avoid the hierarchies, and more crucially, the violence (psychological, physical, social) that was passed down by such a system.
Freeman’s analysis of the feminist movement in the 1960s uncannily parallels working conditions at Valve. Interestingly enough, the backbiting and implosion within the organization also parallels the vicious infighting that occured in a similarly “leaderless, flat” movement — Occupy Wall Street.
Famed for protesting against the flagrant abuses of the Wall Street elite, the movement occupied Zucotti Park in New York City, gaining a wide intersection of supporters: from the anarchistic Anonymous hacker group to left wing academics to regular Americans disenfranchised by the 2008 financial crisis. Even early on there were problems with its “we’re all leaders” attitude and consensus based decision making: the protestors once spent more than an hour discussing how to buy fair trade coffee and was plagued with endless meetings on trivial situations.
By 2014, the movement had fractured into rival factions vying for control. At one point, one faction wrested access of Occupy’s Twitter account and promptly declared:
Idealism had devolved into petty arguments over who were the “true founders” of the movement.
Structurelessness can exacerbate asymmetrical information in an organisation, facilitate the formation of cliques, and produce a toxic environment.
This isn’t to say that all “flat” organisations are bad. Many startups have become incredibly successful due to their more flexible structure and by all accounts are friendly, productive, and growth-orientated places to work at. Many Valve veterans remember fondly that in its early days, Valve was such a place.
The challenge lies in scaling up. As a community or company grows, formal structures serve the purpose of clarifying the rules of conduct and criteria of performance when assumed knowledge and access to people becomes more limited. The alternative is chaos, or a gradual growth of elites who exert control through social pressure. Far from magically solving workplace issues, flat organizations and open offices can exacerbate them.
Indeed, in July 2018, Harvard researchers Ethan Bernstein and Stephen Turban studied two Fortune 500 companies making the switch to open office plans. The results were damning: face-to-face time decreased by around 70 percent across the participating employees, productivity had declined, employees found it harder to concentrate and were overall less satisfied with their job.
Yet many companies are diving headlong into flat organization and open offices experiments without truly considering the impact it may have on the health, productivity, and social cohesion of their employees.
Of course, this mad rush is understandable. We live in a cultural moment of deep distrust towards authority, where the old rigid structures have failed us: free markets and the onward march of industrialization were supposed to bring prosperity to the masses, yet inequality has risen across the world; the Arab Spring was supposed to pave the way for a more democratic Middle East but years on the war in Syria is still raging; the Kyoto Protocol promised a reversal of environmental damage yet climate change is taking more lives every year. We blame not just the system, but all systems — we reject the idea of structure itself.
But it’s all the more reason to remember that structurelessness does not denote the absence of rules. Flatness does not inherently bring equality. Doing away with hierarchy is a means to the end of creating a better working relationship, not an end unto itself.
More than 200 years ago, demands for a freer and more equitable society exploded into full scale revolt during the French Revolution. Drunk in the fervour of deposing the monarchy, the French revolutionary Maximilien de Robespierre cried:
“The king must die so that the country can live.”
Beset by economic, social, and organisational problems, idealism quickly gave way to a Reign of Terror where mob justice ruled. In 1794, only two years after his call for the end of monarchy, Robespierre was himself executed by guillotine. Only 10 years later, Napoleon Bonaparte was crowned Emperor of the French.
In our desire to bring down the kings of the workplace, we should be careful not to create new emperors in their stead.