Valve Corporation: Does flat management have a half-life?

This case study explores Valve Corporation, an entertainment software provider. It assesses the products, the flat management structure (anarcho-syndicalism in a political economic context), the benefits and costs of such a structure, and whether it has lessons for firms elsewhere in the economy.

Scope

Analysis of Valve's product range and past successes.

Assessing the context of a flat management structure theoretically.

Assesses how flat management works in practice, with the benefits and disadvantages of an absence of hierarchy evaluated.

Reasons to buy

What is Valve Corporation?

How is Valve Corporation run?

What are the benefits of a flat management structure?

What are the disadvantages of a flat management structure?

Companies mentioned

None

Table of Contents

OVERVIEW

Catalyst

Summary

A BRIEF HISTORY OF VALVE

Valve's beginnings

The games software market is lucrative

Valve's game production is high end

Steam digitized video game distribution

Steam brings ecommerce advantages to games software

Steam is well received by consumers

Steam diversifying services but retaining focus on gamer

Steam’s complementary services: Steam Music and Steam Broadcast

Expanding onto other platforms

Source powers Valve’s games

Valve’s future ambitions: wearable tech and Steam Machine

ANARCHO-SYNDICALISM: HOW VALVE IS MANAGED

Who is manning the Valve?

Cabals help Valve complete larger projects

Valve shows some traits of anarcho-syndicalism

Valve in practice for employees

Valve’s recruitment process

Valve’s performance measurement: Stack rankings and Peer review

How Valve counters malfeasance

Valve in mergers and acquisitions

WHERE FLAT MANAGEMENT BENEFITS VALVE

Employees become stakeholders, improving the value chain

Valve evokes strong loyalty in gamers

Valve compared to other gaming studios

Valve refuses to exploit its most popular franchise

Self-funding maintains the company’s vision

Valve’s theoretical benefits

Cabals and resolving disputes

THE COSTS OF VALVE’S MANAGEMENT STYE

Valve is a strong player in a niche market

Windows 8: Microsoft’s revenge?

Valve time: a redundant constraint?

Recruitment for Valve is much more complicated

Recruitment constraints are expressed more harshly

Recruitment errors can be much more costly

Diversifying talent pool is harder

Is flat management viable beyond a certain size?

Valve in theory versus Valve in practice

CONCLUSIONS

Valve goes flat out

APPENDIX

Definitions

Sources

Further Reading

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List of Tables

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List of Figures

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