A new model for work is required. Hierarchies, simple branching networks, are obsolete. They work well when information flows mostly in one direction: down. Hierarchies are good for command and control. They are handy to get things done in small groups. But hierarchies are rather useless to create, innovate, or change.
We have known for quite a while that hierarchies are ineffective when things get complex. For example, matrix management was an attempt to address the weakness of organizational silos resulting from simple, branching hierarchies. In matrix management people have more than one reporting line and often work across business units. However, the performance management system and job structure usually remain intact so that it adds more complication, rather than increased effectiveness.
Any hierarchy, even one wrapped in matrices, becomes an immovable beast as soon as it is created. The only way to change a hierarchical organization is to create a new hierarchy. This is why reorganization is so popular; and so ineffective. Most organizations still deal with complexity through reorganization. Just think of the last time a new CEO came in to ...