Week 1 PSP: Three Ways to Organize a Company

I was intrigued by the different ways in which companies organize their people. Based on my understanding, Spotify is organized into small cross-functional groups called squads, which don’t have an explicit hierarchy within them but have a product manager or ‘product owner’. Multiple squads form tribes, while chapters connect people with similar functional expertise and guilds bring together people with shared interests. Each squad has a specific mission it works on and includes a product manager, QA analyst, UX designer, engineer and more. The product manager handles prioritization of work but not necessarily the process to be followed by the squad.

Airbnb is organized functionally, with PMs reporting to product leaders, designers to design leaders, and so on for engineering and other functions. Because of the design focus of Airbnb, the design arm and leadership has a strong influence on decisions about what gets built. As I understand it, Spotify puts PMs more at the forefront whereas Airbnb gives more influence to design and senior leadership. It seems like the PM has less unilateral authority here.

Zappos was the most unique org chart because of its use of Holacracy and its lack of a traditional hierarchy. The teams are self-managed and cross-functional, with authority distributed across the different roles. This allows for greater adaptability, and PMs and other professionals probably have a more equal say in decisions about what gets built as compared to Airbnb.

It feels like the PM has the most autonomy in Spotify, followed by Zappos, and then Airbnb. I would want to work at Spotify because of the additional autonomy, but also because Zappos’ structure feels very unfamiliar and might be a difficult adjustment, whereas Spotify feels more structured. Airbnb is more design-focused and has more centralized decision-making, so I am less interested in that, although I think it works well for them.

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