Unity of command: Refers to an organisational structure or leadership structure in which each employee reports to only one supervisor. This eliminates confusion associated with receiving conflicting orders from several different supervisors. It also encourages accountability, more effective information flow, and better co-ordination between employees.
Authority and responsibility: As with any organisation, each employee will most likely have at least one authoritative figure to report to (i.e. a boss, manager or supervisor). The only exempt employee would be a CEO, business owner or President, but even then he or she might have to follow the Board of Directors or stockholders orders to an extent. Each employee will be responsible for reporting to that figure and following orders and completing tasks.
Span of Control: Typically refers to how many subordinates a supervisor or manager has. It isn't uncommon to see a 'Span of control' of 1 to 10 subordinates, and in some cases more. In organisations that use cross-functional reporting, supervisors or managers might share that role with another supervisor or manager in a different department.
Contingency factors: Contingency theory refers to a behavioural theory which states that there is no one right way to run or structure an organisation' it depends on the internal and external situations.
Using Org Charts to Create an Organisations Design
Organisational charts are useful for communicating, modelling and creating structure in any organisation. The organisational design capabilities within an organisational chart include:
- Creating teams and groups - Project teams usually are comprised of employees with different skill sets from different departments or business functions. Project teams can be documented easily within an org chart. They can be used for measuring skill mix, costs, resources used and more. By viewing metrics, such as productivity level or performance rating, within the org chart, managers can easily create project teams.
- Displaying ad hoc project teams - Some organisations have teams such as disaster recovery teams or subcommittees that may come together and dismantle daily. These teams and corresponding metrics can be viewed quickly and easily through the org chart, with simple searching capabilities and conditional formatting features.
- Getting the most out of the workforce - HR and executive teams can use the org chart to model different workforce structures, and compare it to the current design to evaluate costs, gaps, and overlaps.
- Testing different scenarios - For any organisation that is planning to or has already started reorganisation, M&A (merger and acquisition), or other workforce change, organisational charts can provide the map for understanding the new or updated workforce. Modelling "what if": scenarios has never been easier. Org charts can provide HR and executive teams with dynamic calculations to evaluate objectives, budget and compliance restraints.
- Implementing hierarchy - Organisational charts can be used to determine and propose hierarchy for a business unit, department or division. Org charts can be used to develop a divisional structure of any size.
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