The Finding
A multi-year study of more than 250 companies and several thousand managers, led by Donald Sull of MIT Sloan School of Management together with Rebecca Homkes of London Business School and the LSE Centre for Economic Performance, found something that cuts against how most leadership teams talk about alignment. Only 9% of managers said they could rely on colleagues in other functions and business units all of the time; roughly half said they could rely on them most of the time.
The more striking finding sits alongside it. Across the companies studied, vertical alignment — the process by which strategy cascades from the top team down through the organisation — was generally sound. The central execution problem was horizontal: coordination across units, not agreement within them.
This matters because “leadership alignment” is usually discussed as a top-team problem. Get the senior group aligned on the plan, the thinking goes, and alignment will follow. The research suggests the opposite failure mode is more common: a genuinely aligned leadership team sits above an organisation where different functions are quietly working from different assumptions about priorities, timelines and who owns what.
What It Means in Practice
Inside a growing organisation, this usually doesn’t look like open disagreement. It looks like smooth-sounding meetings followed by diverging behaviour once people return to their desks.
A sales function agrees a priority in principle, then continues operating against its own quarterly targets because nobody has reconciled the two. A product team and a delivery team both believe they own a decision, so it gets made twice, in two different directions, before anyone notices. A regional or site lead interprets a company-wide priority through the lens of their own operating pressures, producing a version of “alignment” that would be unrecognisable to the person who set the priority.
None of this shows up as conflict. It shows up as drift — small, reasonable-seeming local decisions that, in aggregate, take the organisation somewhere the leadership team did not collectively choose. By the time it becomes visible, usually through a missed handoff or a customer-facing inconsistency, leadership often reaches for more communication as the fix: another town hall, another cascade deck, another round of “make sure your team understands this.” That rarely addresses it, because the gap was never about whether people heard the message. It was about whether the structures connecting functions were built to carry it.
Why It Happens
Michael Beer and Russell Eisenstat, writing in Sloan Management Review, examined why senior teams in growing organisations so often fail to surface what they collectively already know about their own implementation problems. Their research identified a set of mutually reinforcing barriers — among them an unclear strategy sitting alongside conflicting priorities, a top-down or laissez-faire senior management style, and poor vertical communication — that quietly block both implementation and organisational learning. As they put it, without addressing the barrier that prevents problems from being discussed openly, none of the other barriers can be resolved either.
There is also a simpler, structural reason cross-unit alignment degrades with growth. Every additional function, layer or site adds interfaces, not just headcount. A ten-person team has a handful of relationships to keep aligned; a two-hundred-person organisation spread across several functions has an order of magnitude more, most of them informal and undocumented. Alignment that once happened by proximity — people simply overhearing each other’s priorities — has to be deliberately engineered once that proximity disappears. Few organisations redesign for this at the point it stops working; most keep running the informal version longer than it can bear.
The two explanations reinforce each other rather than competing. Beer and Eisenstat’s barriers explain why senior teams often do not notice the gap — silence and conflict-avoidance keep it invisible at the level where it could most easily be addressed. The interface-growth explanation shows why the gap keeps widening underneath that silence, regardless of whether leadership has noticed it. A senior team can be entirely well-intentioned, communicate clearly and still preside over worsening horizontal drift, because the drift is a structural consequence of growth rather than a failure of individual effort.
Where It Varies Across London
This pattern is not unique to London. What changes here is the timeline over which organisations meet it, and the density of variables layered on top of it.
ONS data on UK business activity, size and location has for over a decade shown London accounting for close to a fifth of all VAT- and PAYE-registered businesses in the UK — a concentration no other region approaches. That density has two consequences for alignment specifically. First, specialist roles are easier to fill discretely in London than almost anywhere else in the UK, which means growing organisations here tend to fragment into more narrowly specialised functions, sooner, than a comparable organisation growing in a smaller market — more interfaces, earlier. Second, a deep and highly mobile talent pool means London organisations absorb people from a wider range of previous employers and sectors, each carrying their own implicit assumptions about how decisions are supposed to travel between functions. Those assumptions rarely get made explicit; they simply collide.
Multi-site operation compounds this further. An organisation running teams across several London locations, or across a London head office and regional sites, adds a geographic layer to the coordination problem on top of the functional one — a theme examined in more depth in relation to multi-site growth specifically.
None of this means London organisations are worse at alignment. It means the conditions that eventually expose the gap in any growing organisation tend to arrive here in a more compressed window. An organisation growing at a similar pace in a smaller regional market might take several years to accumulate enough specialist functions and site locations for horizontal coordination to become the dominant problem; in London, the same accumulation can happen inside a single funding round or a single expansion phase, simply because the surrounding market makes each individual step — hiring the specialist, opening the second site, poaching from a competitor two streets away — easier to take.
Where this shows up
Written for organisations in London. See the London market page for related reading, or browse the other hubs on the Markets page.
Questions worth considering
- Is what looks like a communication problem actually a decision-rights problem — a case where two functions each believe they own the same call?
- If cross-functional reliance were measured directly, rather than assumed from the top team’s own cohesion, what would it show?
- Where has proximity been quietly doing the work that structure should now be doing instead?
Your team is facing similar challenges?
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