At Spotify, when people moved teams, they often kept their original manager. This created a chaotic web of reporting lines, making it impossible to establish clear accountability, consistent performance management, or unified team direction, ultimately undermining the model.
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Companies mistakenly bundle management with authority, forcing top performers onto a management track to gain influence. Separate them. Define management's role as coordination and context-sharing, allowing senior individual contributors to drive decisions without managing people.
Despite internal failures and employees questioning why the outdated, aspirational model wasn't removed from public view, Spotify continued to leverage the hype. The vision of autonomous 'squads' was a powerful magnet for attracting talent, even if it didn't reflect the operational reality.
Before emulating a company like Spotify, leaders should examine its entire business. The Spotify model that underpays creators to achieve profitability reveals a culture that might not be worth replicating, regardless of its internal structure.
In his review of thousands of org charts, serial acquirer Brad Jacobs flags managers with only one direct report as a key indicator of organizational bloat. He calls this "companionship" rather than management, highlighting it as an inefficient layer that slows communication, adds cost, and ultimately harms shareholder value.
The success of any org model is tied to preconditions like executive backing and a collaborative culture. Simply renaming teams to "squads" and "tribes" without changing underlying behaviors is just "installing a new set of jargon" and leads to failure.
The famed organizational design was merely an aspirational "wishlist" that Spotify never fully adopted. Companies copying it are chasing a fantasy primarily used for recruiting, not a proven operational model that the company itself ever ran on.
The "3 A's" framework offers a practical alternative to the pitfalls of unchecked autonomy seen at Spotify. True empowerment means ensuring teams have strategic guardrails (Alignment), clear responsibility for outcomes (Accountability), and the capability to succeed (Ability).
A former Spotify agile coach admitted they focused too much on autonomy, which created "really dumb problems." Teams lacked standard tooling like a common version control system, proving that autonomy requires strategic guardrails and alignment to be effective at scale.
Expedia received 20 million support calls for itineraries because each department (marketing, tech, product) focused only on its own metrics. No single silo owned the cross-functional problem of preventing calls, so the problem festered despite its massive scale. True ownership must transcend departmental lines.
Organizing by function (e.g., all sales together) seems efficient but incentivizes teams to optimize their individual metrics, not the company's success. This sub-optimization prevents cross-functional learning and leads to blame games, ultimately harming the entire customer value stream and creating a non-learning organization.
