A slightly radical theory: flat organizations are set up to foster that intentionally.
Suppose your company has the idea that they want to identify and reward natural leaders and/or those who test limits and push through boundaries.
One way to do it is to tell people your organization is flat, then watch for the people who don't buy that and instead see an opportunity to take charge.
You create a situation with a little bit of an artificial and completely intentional power vacuum, then you watch who takes it upon themselves to step in and fill it. By holding a bit of a vacuum, you encourage these people to show themselves. (And I'm convinced management is actively watching to see who takes that bait.)
I'd say these are the most common responses: (1) never reach awareness that it's happening and continue to take flat at face value, (2) see it as opportunity and take advantage of it, and (3) see it as unnecessary game-playing and dislike it.
Whether 2 or 3 is better is an interesting question. It might separate the practical people from the idealists, or maybe it separates the self-interested from the more community-minded. I can see some of both, personally.
EDIT: I don't necessarily want to be completely dismissive of the idea. There's something to be said for creating situations that allow for people to stretch and try out new roles. That's how people develop. This is informal and stealthy, but it is a way to do that.
I'm glad you brought this up, even though I disagree with your analysis.
In my experience, in the power vacuum there are several types of people:
1. Those who are blind to it
2. Those who want power and have charisma
3. Those who want power and lack charisma
4. Those who do not want the responsibility that comes with the power, but take it to save the team
5. Those who do not want the responsibility and explicitly avoid it
The problem is that those five categorizations are independent of competence, in terms of technical skills but especially in terms of leadership skills. So if you do this sort of social experiment, what you get are people who want power regardless of competence.
Now if that's what you're looking for, then by all means, do it, but I'd bet that you're actually hoping to find the capable ones, not the power seeking ones.
I don't have a good answer for how to set up a self-sustaining organization that consistently surfaces excellent leaders, because I've never seen one, but I'm pretty sure the power vacuum won't do better.
You may be overestimating how much management is paying attention. As long as things are shipped reasonably close to time and no one is filing lawsuits most stay more concerned with their own goals than that of their staff.
You raise a good point. Flat probably doesn't always work this way. It wouldn't be a good idea to assume that every flat organization is doing what I describe.
While I'd personally argue that people development is an essential duty of management, they may not see it as important. Also, in some cases, management may just see it as a way to be less rigid.
I like your cynical take, but I'm not convinced it's actually the goal of management in all cases. I could see it drifting in that direction over time regardless. That said, some founders are actually idealists. I frequently discuss this topic with people who are aware of the invisible hierarchy problem and are interested in potential solutions. I think there are well-meaning attempts at this, even if they don't work perfectly.
I'm not in favour of flat systems for exactly this reason. I think they try to solve the problem of bad leadership structurally, by simply pretending to abolish leadership. IMO, it would better be addressed personally - e.g. by investing in leadership training or vetting candidates for leadership roles more thoroughly.
I think some people, myself included, are coming at this with an ideological lense. The problem we want to solve isn't bad leadership, it's leadership in general. Hierarchy is a problem for us, and it's just as valid a problem to pick as human suffering or anything else. Coming at things from this angle, investing in leadership training is addressing a different problem entirely. I suspect that the "flat" organizations we've seen, such as Valve, have some pretty major shortcomings. I could see there being solutions to some of these shortcomings through technology and game-theory (decision making apps with specifics I don't know the details of), and I also think there might organizational structures somewhere between the traditional hierarchy and a flat structure where small hierarchies exist in a flat higher-level organization (I get how an interpretation of this can converge on the current higher-order ecosystem of corporations, but there are other directions you can take it).
Suppose your company has the idea that they want to identify and reward natural leaders and/or those who test limits and push through boundaries.
One way to do it is to tell people your organization is flat, then watch for the people who don't buy that and instead see an opportunity to take charge.
You create a situation with a little bit of an artificial and completely intentional power vacuum, then you watch who takes it upon themselves to step in and fill it. By holding a bit of a vacuum, you encourage these people to show themselves. (And I'm convinced management is actively watching to see who takes that bait.)
I'd say these are the most common responses: (1) never reach awareness that it's happening and continue to take flat at face value, (2) see it as opportunity and take advantage of it, and (3) see it as unnecessary game-playing and dislike it.
Whether 2 or 3 is better is an interesting question. It might separate the practical people from the idealists, or maybe it separates the self-interested from the more community-minded. I can see some of both, personally.
EDIT: I don't necessarily want to be completely dismissive of the idea. There's something to be said for creating situations that allow for people to stretch and try out new roles. That's how people develop. This is informal and stealthy, but it is a way to do that.