The structuring of organisations doesn’t seem to be fashionable in present-day management studies. Even Henry Mintzberg, whose book of that title (1979) influenced me quite greatly, plays it down in his current work. But organisations still have formal structures of control and accountability, and no one reading this blog is likely to doubt the proposition that structures are important. One aspect of organisation structure is the ‘span of control’ – quite simply the the number of people reporting to an individual manager. Early management writers had dogmatic views about what this number should be: no more than ‘five, or at the most, six subordinates whose work interlocks’, according to Lydal Urwick (1956).
This may seem rather theoretical, but I think span of control may be relevant to some current debates – even, perhaps, the debate about public sector salaries. Let’s play with some numbers: think of an organisation with about 40 members. If the span of control is constant at three (three people reporting to each manager, from the chief executive down to the lowest level in the hierarchy) the organisation will have four levels and a total of 40 members, of whom 13 (32.5%) will be team leaders, managing other staff. Double the span of control to six, and we encompass 43 people within just three levels, and only seven of the organisation’s members (16.3%) are managing other staff. That of course is simplistic: in most organisations, spans of control will vary according to a number of factors, including the complexity of the work being undertaken by team members, the degree of intervention that is needed from team leaders, and the extent to which team leaders have personal workloads in addition to being managers. But the basic point remains true: the smaller the average span of control, the more levels will exist from top to bottom of the organisation chart.
From my observation (and it’s been widely reported) private sector organisations in the UK have been doing quite a bit of ‘de-layering’ in recent years – increasing the size of teams and flattening their organisation structures. That chimes well with the desire to empower people, so that they can exercise greater control over their own work, and with the need to reduce overhead costs. The process has been assisted by the development of management information systems. Spans of control (team sizes) of seven to ten seem now to be quite common, even at the chief executive level. Deep organisations, with many levels from top to bottom, feel distinctly old-fashioned.
It seems, however, that de-layering has occurred less in parts of the UK public sector, where spans of control as small as three are still quite common in the upper reaches of organisations. The more levels there are in an organisation, the more salary differentials there are bound to be, and the more members of staff regarded as ‘senior managers’. Concern has been expressed in the UK about the rapid increase in the number of public sector staff receiving salaries greater than £50,000 pa ( a threshold level for the disclosure of remuneration in annual reports), and about what some regard as the excessive salaries of some chief executives. The number of hierarchical levels in organisations must be relevant, I suggest, to both these issues.
So how should all this concern the construction industry? Well, at the very least we can critically observe what is happening in our own organisations; and, perhaps, urge that construction professionals in the public sector should enjoy the empowerment that comes from shallow organisations. Some might want to extend the discussion into the public spending debate, and suggest that leaner, shallower public client organisations could help to mitigate, however slightly, cuts in vital construction programmes.
Someone once suggested to me that reducing the size of his team had given him a ‘quieter life” - I didn’t think to ask at whose expense he enjoyed that benefit.