Four dimensions of organizational hierarchy are identified: inequality of skills and knowledge, inequality of rewards, inequality of authority, and inequality of information distribution. Instead of the prevailing and largely untested hypothesis that hierarchical structure is positively related to organizational effectiveness, an alternative hypothesis is formulated, viz., that it is negatively related. This hypothesis is linked to a causal model interrelating hierarchical structure with work alienation, organizational commitment, and organizational effectiveness. Some evidence for the alternative hypothesis is examined. The four-dimensional concept is then used to assess the burgeoning literature on industrial democracy. The phenomenon of "shop-floor democracy" is conceptualized as involving a process of destratification with respect to allfour dimensions of hierarchy. In view of environmental pressuresfor the rationalization of organizations as well as the secular trend in this direction, a destratification-rationalization hypothesis is formulated: As the positive slope of the relationship between these two clusters of variables increases, organizational effectiveness increases and work alienation decreases. To test this hypothesis an experimental approach, whether in the laboratory or in the field, is essential.
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