Span of Control

1 January 2017

Corporations often see a shift in executive teams throughout the course of their existence. Often times when during a company merger, acquisition, or a vote by the Board of Directors to replace the company’s leadership, a new style of management will emerge. Different leaders have various ideas on how the management of the company is to be handled. Some CEO’s like to have a small executive team, with separate areas of the business combined into segments and receive reporting through their direct reports, while others like to have a large executive team with a different leader for each business segment.

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With the number of different management styles out there, employees need to be able to adapt to these changes. In the example provided, the CEO of Fiat decided to flatten the management organization between Fiat and Chrysler. In doing so, the CEO increased the number of direct reports he had under his span of control. In reducing the number of management levels, each of his direct reports had a broad area of the business to control and be responsible for. The move to flatten the span of control allows the business to bring out its employees talents, skills, and strengths.

A move like this can be a positive one for the employees as it boosts morale and gives power to the employees of the business to collaborate and be a part of the company’s success (Griffin, 2012). Giving everyone in the organization the feeling of having a voice is a good way to keep all employees engaged and passionate about the company’s success. The change in the management structure promotes the business to the workforce and provides an opportunity for the management team to build on the success of its employees.

While a flat management structure has some positives, there are also some issues that leaders should keep a watchful eye out for to ensure the shit in control is successful. Managers in a flat structure need to be sure to share any research or information they may have with others and not keep it secretive. If a manager can be open and even a little vulnerable, the success rate in using a flat structure can be positive (Griffin, 2012).

The flat structure does cause managers to end up with a heavier workload and can lead to confusion among its leaders about who is responsible for what roles Griffin, 2012). When so many people are reporting to one manager, a sense of distrust can be built among the reporting chain. This is why it is important to keep an open dialogue with employees to keep their trust. Flattening the management organization reduces the company’s complexity. The span of control is spread out and reduces the centralization of authority. The defined structure of every employee’s roles and responsibilities is less controlled and more open. This allows everyone to approach their jobs with the freedom to accomplish tasks in their own way as long as they work is getting done.

Every organization needs to evaluate the business and determine what span of control provides the best return for the company. If the business is one where the jobs require specific skills to accomplish tasks, a tall management structure may be the best suited for continuing progress. Organizations with jobs that allow a less defined skill set, a flat management structure provides the ability to tap every employee’s skills and achieve their full potential.

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