Flat companies need dedicated development teams
Companies are removing middle-management layers, but flattening does not remove coordination. Gore, Valve and Zappos show three ways that work reappears—and where a dedicated development team can fit without recreating the management layer.
Companies are removing the middle-management layer.
Gartner predicted in October 2024 that through 2026, one in five organisations would use AI to flatten their structure, removing more than half of their middle-management positions.
Monday.com cut around 20% of its staff in July 2026. The plan described fewer management layers and smaller teams that run themselves, and their co-CEO called the old structure "not the organization that fits the new AI era."
In Australia, the AI Jobs Index tracks publicly announced workforce reductions where AI was named as a driver: 3,610 roles where the attribution was explicit, and 11,934 once reductions with mixed attribution are included, across 13 approved announcements. Individual events include WiseTech Global at 2,000 roles in February 2026 and Atlassian at 1,600 in March.
Three companies that ran flat structures.
W.L. Gore, founded in 1958 and organised through a lattice. Gore describes a team-based culture where associates build connections without traditional chains of command. Every associate has a sponsor, and leaders are expected to emerge through skill, capability and followership.
Valve, model published 2012. Valve’s employee handbook describes no managers, desks on wheels and employees moving to the work they judge most valuable. It also describes peer reviews and stack ranking as formal processes for feedback and compensation. Former hardware lead Jeri Ellsworth later described a hidden informal management layer beneath that model; that is one former employee’s account, not Valve’s stated position.
Zappos, holacracy from 2013. Around 1,500 people, no managers, self-defined roles. In 2015 staff were offered the choice of committing to the system or taking severance, and 18% left. Turnover that year reached 30%, ten points above the company's normal rate. The company left Fortune's 100 Best Companies to Work For for the first time in eight years, with survey scores down on 48 of 58 questions. Zappos has since moved toward a market-based system in which teams operate as independent small businesses with their own profit and loss.
What each did with the coordination.
The three arrived at different arrangements for the work that managers had been doing.
Gore placed it inside small teams, with sponsors attached to individuals. Zappos, after the holacracy period, placed it inside teams that carry their own profit and loss. At Valve, ex-employee accounts describe it re-forming informally, without a documented structure to attach it to.
Two of the three ended with the work organised into teams. Gore did not have a hierarchy to remove, and most self-managing companies either started that way or changed over many years; the Zappos transition was made in a single move.
Individual hires need the direction the company just removed.
A flat organisation has fewer people whose role is to direct other people.
Individual contractors arrive needing their work sequenced, their questions answered, their output reviewed and their onboarding carried. In an organisation that has removed the roles that did that, those tasks move to whoever is available, which is usually a senior engineer.
A team is a different unit. It brings the coordination inside itself: its own lead, its own delivery rhythm, one stream of work, accountable as a group.
Senior developers are more experienced. They need less direction, they catch problems earlier, and they get more done. That is what makes a flat structure work: a company can remove the layer because its people no longer need it. Staff the same structure with juniors and the layer comes back under another name.
It does not bring decisions about what to build. Roadmap, priorities, architecture standards and product calls stay with the people who own the product.
The only coordination that transfers is the tech lead's.
We build dedicated development teams in Vietnam. Five senior developers minimum, recruited for the roles you name, working for one customer only, on twelve-month terms. Each team has its own tech lead, and you interview every hire. The detail of how that works is on hire dedicated developers.
The team is a delivery unit inside your business. You set the roadmap and the priorities, you own the product decisions and the standards the work is held to, and the team takes a stream of that work and delivers it. The tech lead coordinates the five developers. That is the only coordination that transfers.
Build your team to tell us what you are working on.
The company histories and market figures on this page are sourced above. The interpretation of what they mean for a dedicated development team is ours.
Frequently asked questions
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