No hierarchy! An outsider’s view to one of the world’s coolest companies

May 3, 2016

Read time 8 min

I’ve worked with more creative companies than I can remember. An independent pretty much since the dotcom bubble burst, I’ve seen A LOT.

This year, however, in New York City, I discovered something truly unique.

I was excited for the chance to work with Reaktor. It was intriguing to get to see how my countrymen are doing in the New World (me and Reaktor both come from Helsinki, where they have an exemplary reputation).

Initially, I found the atmosphere exceptionally relaxed, the people friendly and funny, the terms of my (verbal) contract favorable, and my input valued. The general flow of things was smooth. “What a cool company,” I thought.

There definitely was a whiff of distinction in the air from the beginning, but it took me a while to realize there’s something slightly magical going on.

Reaktor is culturally different from any other company I’ve come across. ‘Flat hierarchy’ gets thrown around in their job postings and blog content, but it’s easy to mistake it for something trivial. But I assure you, it makes a world of difference.

In fact, it’s somewhat overwhelming how much it really means.

A naturally grown organism

Reaktor began as a small company in 2000, founded by friends who wanted to enjoy their jobs. Today, they’re approaching 400 employees on three continents. Growth has rapidly accelerated in the past couple of years, and flat hierarchy is still predominant. For a bit of a backstory, read this.

The fact that they’ve been able to pull it off is major, and worth an academic study or two.

To this day, Reaktor’s hierarchy-free structure remains organic. It’s self-invented and built from scratch—not implemented according to any organizational theory or original master plan. It has nothing to do with holacracy, or any other fabricated management model one might have heard of.

It’s the way the company has always worked, and then grown one employee at a time, with every hire adding to an exceptional group of people supporting the core principles.

“Ever since the beginning, our success has been built on recruiting. Smart, skilled, culturally compatible people, with adequate seniority,” says Joonas Makkonen, CEO of the New York office. “That’s the main reason we are able to do what we do.”

Reaktorians thrive in special conditions

As autonomous teams, Reaktorians deliver results of the highest quality, even with schedules unrealistic to the competition. They are known for it, and building such a reputation requires consistency. And that requires best-in-class talent.

(Several other things separate them from the competition, too, like going to space, teaching kids to code, and running an investment company—all projects that employees wanted to take on out of natural interest.)

In Reaktor’s case, flat hierarchy is key not only to being able to attract and keep the best employees, but also to get them to thrive and develop. It’s fertile ground for personal growth and fosters excellence through mutual respect, and distribution of responsibility.

For a talented and smart individual, having the freedom to manage oneself is great for being happy. For a company, a structure that enables quick decision-making is great for outstanding processes and results. It’s beneficial even for the client, to whom all team members answer equally in delivering value.

Like a boss, literally

The term ‘boss-level’ is used as an adjective in the company lingo to describe the employees. First, I mistook it for meaning highly skilled. As it turns out, it means boss-level, literally.

“We’re a consultancy of 95% seniors and 5% juniors. Usually it’s the other way around,” says Hannu Oksa, Creative Director. “However, seniority doesn’t automatically equal superior competence. Anyone can claim responsibility and leadership, provided they have the means to do it,” he continues. “Who makes decisions is not predefined, and the opportunities to bring something to the table are never-ending, regardless of your title.”

He emphasizes that the decision making process varies, and is free of egos. The best call is often someone else’s, and that should be seen as a great thing.

Makkonen agrees: “You can’t ask me to decide for you. You can talk to me and hopefully I can offer guidance, but in the end, it’s you and your team calling the shots,” he continues. “Essentially, the job of top management is to be available to talk. We all guide each other, really.”

Your client, your call, your company, your responsibility

So, the basis of it all is this: Small and autonomous teams take on projects, work closely with clients, communicate, and make decisions on their own. Seems simple. But is it?

“Coming from companies with traditional structures, new employees struggle in the beginning to figure it out. Not being able to ask for permission or say ‘my boss’ creates uncertainty at first. People are so used to saying that. To realize that leadership can be shared takes a while,” Makkonen points out.

Naturally, freedom comes with responsibility, and making important decisions can be intimidating. Explaining this balance is prevalent in the company’s interview process and HR approach for new employees making the cultural transition. There’s empathy for newcomers, and real effort to make them feel at home.

A three-week visit to the company headquarters in Helsinki is part of standard orientation, and talking about anything and everything at length is encouraged. Even imposter syndrome, which has been discovered to be a common symptom among recruits, is proactively discussed with new employees. The open culture free of egos and aggressive competition makes it easy to confess having such emotions.

An informal open discussion with a few peers is also the basis for the occasional performance review, defining and redefining salaries, and planning career paths within the company.

Essentially, open discussion and common sense seem to be at the core of pretty much everything.

The endless possibilities of career progression

“We expect the people we hire to grow. No one is complete. If you’re smart, you can become anything,” Makkonen crystallizes, when I ask him about Reaktorian career progression.

Hannu Oksa is proof of this. Instead of concentrating on climbing management ladders, he focused on things he was passionate about. After a couple of years with the company in Helsinki, his interest for international projects has brought him to New York, where his responsibilities include developing the design team. It’s what he wanted to do, so he was given a chance. Then, he demonstrated the capabilities needed.

“My career progression and personal development have definitely benefited from the company culture,” he says. “In the long run, we all have the opportunity to define our role, and even change career paths completely.”

Instead of having to choose between advancing to middle management or staying put, Reaktorians can move forward and still get their hands dirty—if that’s what they want. Engineers love to engineer, you know, not push papers.

Self-organization allows people to work much like independent contractors, while some have roles that resemble entrepreneurs. Some jump to sales from design and some to marketing from programming. Everyone learns, and the company benefits from the diversity.

And get this: No one has ever been fired. People have obviously left, but most of them after spending years with the company. Many of them have returned, or become Reaktor’s clients at their next job.

No life-threatening vehicles running through the office

Having coffee with Jaime Pedersen, the very first American employee of the NYC office, one thing became very clear. People thrive when they feel safe.

“It’s a dog eat dog world out there,” Jaime said to me laughingly, when I asked her to compare Reaktor’s culture to some of the other creative companies she’s familiar with.

“Working for Reaktor, I know I don’t have to feel threatened. Previously in my career, I’ve been thrown under a bus when someone needed a scapegoat for things going wrong,” she told me.

The need for blame games and unhealthy competition is nonexistent in a flat hierarchy organization with shared responsibility. Also, the communication simply works too well for any of that to fly.

Now working on Reaktor’s HBO account, Jaime responded to a job posting that called for “a social butterfly who likes to get things done.” Her schedule is often challenging, but she fully enjoys the Reaktorian way of working. “It’s empowering and a bit scary at the same time. But it feels safe. It’s based on understanding and it makes sense,” she says.

She looks forward to finding her track within the company as a positive challenge, and feels like she’s been welcomed with open arms.

“Another thing that’s great is that I’m now free of the tyranny of billable hours. And I don’t think I’ll ever have to write another performance review,” she laughs.

Outsider’s outro

Realizing what it means to work for a non-hierarchical company of exceptional people is truly transformative (even when it’s freelance and periodic). Especially when you’re previous experiences have been quite the contrary. That’s most of us, because let’s face it, that’s the norm.

Instead of sizing up the people in the room and wasting time on analyzing dynamics, you can cut to the chase and start making friends. You can appreciate talent and what you can learn instead of making pointless comparisons. You’re freed from the fear of making mistakes. You can make stupid jokes with people you don’t know at all, and work in whatever way feels most natural.

And, you know people will listen when you think you have something of value to share.

Hierarchy was obviously a necessary step in the evolution of mankind. Was. Let’s leave it behind, and follow the example of those that have figured out the next step.

Now, check out and start writing a heartfelt letter.


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