A company with a formal org chart is a company big enough to have an informal org chart that accurately describes how things actually get done.
From Byrne Hobart at The Diff, a list of scaling bottlenecks often encountered by startups: Recruiting, decision-making, management, and more.
[O]ne of the biggest scaling bottlenecks ends up being the related problems of asymmetric information and decision fatigue. In a small company with a flat corporate hierarchy, information travels fast. If people are working long hours in close proximity, it’s almost impossible for anything to stay secret. And if everyone’s either a founder or a direct report of one, there isn’t much room for politics. A company with a formal org chart is a company big enough to have an informal org chart that accurately describes how things actually get done. Whether this is described as “politics” or as “effective” partly depends on people’s relative positions in both. And that adds an inescapable tax to growth: more people means more conflicting interests, and more cases where the right choice for the company as a whole conflicts with the right choice for individuals.
On delegation in particular, very much a limiting factor for learning and growth:
Effective delegation can be best defined in negative terms: a manager is not delegating unless their subordinates at least occasionally make exactly the opposite decision from the one their manager would have made.