Span of Management - Organizing, Contemporary Management B Com Notes | EduRev

Contemporary Management

B Com : Span of Management - Organizing, Contemporary Management B Com Notes | EduRev

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Meaning of Span of Management:

Depending upon the complexity of organisational activities and relationships amongst superiors and subordinates, it becomes important the superiors manage an optimum number of subordinates that result in optimum organisational output. All the subordinates cannot be managed by one superior. There has to be a limit on the number of subordinates who can be effectively managed by one superior.

The number of subordinates that a superior can effectively supervise is known as span of management or span of control. In the 19th and middle of 20th century, management writers determined 5 or 6 as the optimum number that a manager could effectively manage at the upper level.

Beyond this number, managers faced problems like:

1. Overburdened with work.

2. Difficulty in coordinating the activities of large number of people.

3. Difficulty in controlling.

Thus, optimum number of subordinates that a manager could supervise was determinable but today, it is not so. Exact number of employees that managers can effectively supervise cannot be defined. Span of management is situational in nature.

Depending on the number of employees that can be supervised or controlled by managers, there can be two kinds of structures in the organisation:

I. Tall structures, and 

II. Flat structures.

I. Tall structures:

These structures are found in classical bureaucratic organisations. In this structure, a manager can supervise less number of subordinates. He can, therefore, exercise tight control over their activities. This creates large number of levels in the organisation. This is also known as narrow span of control. A tall structure or a narrow span of control appears like this.

Span of Management - Organizing, Contemporary Management B Com Notes | EduRev

Merits of a Tall Structure:

1. Managers can closely supervise activities of the subordinates.

2. There can be better communication amongst superiors and subordinates.

3. It promotes personal relationships amongst superiors and subordinates.

4. Control on subordinates can be tightened in a narrow span.

Limitations of a Tall Structure:

1. It creates many levels in the organisation structure which complicates co-ordination amongst levels.

2. More managers are needed to supervise the subordinates. This increases the overhead expenditure (salary etc.). It is, thus, a costly form of structure.

3. Increasing gap between top managers and workers slows the communication process.

4. Decision-making becomes difficult because of too many levels.

5. Superiors perform routine jobs of supervising the subordinates and have less time for strategic matters.

6. Employees work under strict control of superiors. Decision-making is primarily centralised. This restricts employees’ creative and innovative abilities.

7. Strict control leads to low morale and job satisfaction. This can affect productivity in the long-run.

To overcome the limitations of a tall structure, many organisations reduce the number of levels in the hierarchy by downsizing the organisation. Downsizing is “the process of significantly reducing the layers of middle management, expanding spans of control and shrinking the size of the work force.”

Many companies downsize their work force through the process of restructuring. Restructuring is “the process of making a major change in organisation structure that often involves reducing management levels and also possibly changing some major components of the organisations through divestiture and/or acquisition.”

“The most common and most serious symptom of mal-organisation is multiplication of the number of management levels. A basic rule of organisation is to build the least possible number of management levels and forge the shortest possible chains of command.” — Peter F. Drucker

II. Flat Structures:

These structures have a wide span of control. When superior supervises a larger number of subordinates, flat structure is created with lesser number of hierarchical levels. A departure was made from tall structures to flat structures by James C. Worthy who was a consultant in the L. Sears, Roebuck and company.

A structure where span of control for each managerial position is 4 appears as follows:

Span of Management - Organizing, Contemporary Management B Com Notes | EduRev

To illustrate, if organisations A and B, both have 256 workers and the span of control for each managerial position is 2 for company A and 4 for company B, there will be 9 levels in company A (requiring 128 supervisors at the lowest level, 64 at the next higher level and so on) and 5 levels in company B. A narrow span of control creates more levels in the organisational hierarchy than the wide span of control.

The levels in case of organisation B(5) where span of control is 4 appears as follows:

Span of Management - Organizing, Contemporary Management B Com Notes | EduRev

(The span of 4 prevails for each functional area at each level). For the sake of simplicity, the figure represents the span for only one functional area and one level.

Merits of a Flat Structure:

1. There is low cost as less number of managers can supervise organisational activities.

2. The decision-making process is effective as superiors delegate authority to subordinates. They are relieved of routine matters and concentrate on strategic matters. The decision-making is decentralised.

3. Subordinates perform the work efficiently since they are considered worthy of doing so by the superiors.

4. There is effective communication as the number of levels is less.

5. It promotes innovative abilities of the top management.

Limitations of a Flat Structure:

1. Superiors cannot closely supervise the activities of employees.

2. Managers may find it difficult to co-ordinate the activities of subordinates.

3. Subordinates have to be trained so that dilution of control does not affect organisational productivity.

Both tall and flat structures have positive and negative features and it is difficult to find the exact number of subordinates that a manager can effectively manage. Some management theorists like David D. Van Fleet and Arthur G. Bedeian assert that span of control and organisational efficiency are not related and many empirical studies have proved that span of control is situational and depends on a variety of factors.

Some studies proved that flat structures produce better results as decentralised decision making has less control from the top, promotes initiative and satisfaction at work. Large number of members in a group can better solve the complex problems as group decision making is based on greater skill variety.

Other studies proved that people working in tall structures produce better results as less number of members in a group can come to consensus of opinion and evaluate their decisions more thoroughly. Group cohesiveness is high and, thus, commitment to decisions is also high. Members feel satisfied with their decisions and conflicts are reduced.

Factors Affecting Span of Management:

The following factors help in determining the suitable span of management:

1. Competence of managers:

If managers are competent in their jobs, they can have a wide span of management. Competence of managers is judged by their ability to make decisions related to motivational plans, leadership styles, communication channels and chains, techniques of control etc. Managers who rank high on these parameters can effectively supervise larger number of subordinates.

2. Nature of work:

If employees perform similar and repetitive work, managers can supervise large number of subordinates and, thus, have a wide span of control. Non-repetitive and challenging work requires narrow span of control. Changes in the nature of work also affects the span of management.

Frequent changes as a result of dynamic environment support a narrow span as superiors frequently have to direct the activities of subordinates. Stability in the nature of work supports a wide span of management as superiors’ directions are not frequently required to carry out the work processes.

3. Assistance to managers:

If managers have access to technical or secretarial assistance, a larger group of subordinates can be managed. Span of control can, therefore, be wide. Staff assistance can be useful for collecting and processing information related to various decisions and issuing orders to the subordinates. Managers save time in communicating with subordinates, direct the activities of larger number of subordinates and focus on other strategic organisational matters.

4. Competence of subordinates:

If subordinates are competent to manage their jobs without much assistance from the superiors, span of control can be wide. Competent subordinates do not require frequent directions from the superiors with respect to various organisational activities. Superiors can thus, manage a larger group of subordinates.

5. Plans and policies:

If plans clearly define the organisational/individual goals and policies, superiors can supervise a larger group of subordinates and have a wide span of control. Clearly defined plans include well-formulated policies procedures, methods etc. Particularly, if standing plans are well defined, subordinates know the broad guidelines within which they have to make decisions in similar and repetitive situations.

They do not approach the superiors every time they face a similar problem-solving situations. Superiors can, thus, manage a larger group of subordinates. However, if most of the decisions are made by resorting to single use plans (programmes, budgets, projects etc.), managers have to be frequently approached and the span can, thus, be narrow.

6. Organisational level:

The top executives look after important and specialised activities and, therefore, the span is narrow at the top level but at lower levels the span can be wide, since supervisors are mainly concerned with routine jobs. According to J.C. Worthy, a manager can supervise as many as 20 subordinates at the lower levels.

7. Authority-responsibility structure:

If authority-responsibility structure is well-defined and understood, superiors can supervise larger number of subordinates. People work within the confines of their responsibility and take directions from superiors only when required. Lack of clarity in authority-responsibility structure will create confusion in the organisation. Jobs and who will perform which job, who is accountable to whom will not be clear. In such a situation, managers cannot supervise a large group of subordinates. The span of management will, thus, be narrow.

8. System of control:

Effective techniques of control can enable the manager to supervise larger number of subordinates. Effective system of control promotes decentralisation. Superiors do not actively involve in the decision-making processes as decisions are taken at the levels where they are required. There is extensive delegation, clarity of jobs, authority-responsibility relationships and freedom to take decisions. The span of control can, thus, be wide.

9. Financial factors:

Both narrow and wide structures have financial constraints. A narrow span requires more managers and is, thus, a costly form of structure. Wide span, on the other hand, may result into organisational inefficiencies. Proper balance has to be maintained between the costs and benefits of the span that a manager can effectively supervise.

These factors are situational in nature and the span of management is also, thus, situational. Sometimes it can be narrow and sometimes wide. For the same organisation, it can be different for different functional areas and different levels. The span is usually narrow in the finance department and wide in the marketing department for the same level. It may be different in different organisations for the same functional areas and levels.

Graicunas Theory on Span of Management:

A French management consultant, V.A. Graicunas, introduced a theory on span of management which explains three kinds of relationships that a superior can have with subordinates. He formulated a theory and suggested the number of subordinates under one superior based on mathematical calculations. Superior-subordinate relationships are based on mathematical formulae.

The kind of relationships and the formulae for arriving at the number of relationships is as follows:

Span of Management - Organizing, Contemporary Management B Com Notes | EduRev

Graicunas identified three types of relationships:

1. Direct single relationships,

2. Direct group relationships, and 

3. Cross relationships.

1. Direct single relationship:

This is the relationship between the superior and his immediate subordinates. It represents direct contact of the superior with his subordinates. If there are 3 subordinates (A, B and C) under one superior (X), there will be three direct single relationships, represented by the formula n. These are relationships between X and A, X and B, and X and C.

2. Direct group relationships:

This is the relationship of superior with subordinates in the presence of other subordinates. All possible combinations of superior and subordinate relationship-exist in group relationships. It represents contact of the superior with one or more subordinates while others (one or more) assist the relationships.

For one superior (X) and three subordinates (A, B, C), there will be 9 direct group relationships as follows:

1. X and A with B providing assistance

2. X and A with C providing assistance

3. X and B with C providing assistance

4. X and A with BC providing assistance

5. X and B with AC providing assistance

6. X and C with AB providing assistance

7. X and AB with C providing assistance

8. X and AC with B providing assistance

9. X and BC with A providing assistance

The number of relationship (9) is represented by the formula:

Span of Management - Organizing, Contemporary Management B Com Notes | EduRev

3. Cross relationships:

While the subordinates work under the same superior, they also interact amongst themselves. These are the relationships amongst subordinates. As interaction with B and B’s interaction with A will be different as viewed by the managers and, therefore, this relationship will also be different. Based on the formula n (n -1), with 3 subordinates, 6 such relationships will be formed.

These are between:

A and B

B and A

A and C

C and A

B and C

C and B

With every increase in the number of subordinates by one, increase in the number of relationships is by more than one. While, with 2 subordinates, the total number of relationships is 6, with 3 subordinates, it is 18.

The theory does not seem to have any practical application as it emphasises on the number of relationships and not on the importance of relationships. Based on Gaicunas’ theory, many other management thinkers also suggested numerical limits on the span of management, ranging from 3 to 9 for top managerial positions and 8 to 30 for supervisory management. More than the number of subordinates that can affect the ability to manage the subordinates, managerial effectiveness is judged by the situational factors that can affect the span of management.

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