Understanding Organizational Structure: Chains, Spans, and Delegation

Posted on Mar 27, 2025 in International Business Economics

The Core Elements of Organizational Structure

The fundamental structure of a business defines:

  1. The roles and job titles of employees.
  2. The decision-making processes.
  3. Who is responsible for specific tasks.
  4. The relationships between different positions.
  5. How information is disseminated.

Chains of Command and Spans of Control

Long Chain of Command, Narrow Span of Control

In departments like production, a manager might be supported by a few assistant managers, each overseeing skilled workers. This setup allows for close supervision, ensuring high quality. This is characteristic of a tall organizational structure.

Short Chain of Command, Wide Span of Control

In higher education departments, a head of department might oversee a few senior staff and many lecturers. This structure allows staff a degree of independence and is typical of a flat organizational structure.

Why Businesses Use Organizational Charts

  1. To Identify Communication Flow Problems: Organizational charts illustrate how employees are connected. Communication errors can be traced along the chart.
  2. To Clarify Individual Positions: Charts help employees understand their responsibilities, who they report to, and who is accountable to them.
  3. To Pinpoint Areas Needing Specialists: Firms can identify where specialized skills are required.
  4. To Show Relationships Between Sections: Charts illustrate how different parts of the firm connect.

Key Concepts

Chain of Command

The structure within an organization that allows instructions to flow from senior management to lower-level management.

Span of Control

The number of subordinates who report directly to a manager.

Henri Fayol’s Argument on Span of Control

Henri Fayol argued that the span of control should ideally be between three and six, because:

  1. It ensures tight managerial control from the top.
  2. There are physical and mental limitations to a manager’s ability to effectively control a larger group.

Types of Managers

Line Managers

Have direct authority over subordinates in their departments and can make decisions within their area.

Staff Managers

Specialist advisors who provide support to line managers and the board of directors.

Functional Managers

Specialists with the authority to direct line managers in their area of expertise.

Delegation

Authorizing subordinates to perform specific tasks.

When Delegation is Likely to Be Effective

  1. Employees are empowered to make effective decisions, fostering self-confidence and control.
  2. Delegation isn’t solely used when managers are overloaded, preventing resentment.
  3. Delegation is planned, with clear objectives.
  4. Managers explain delegated tasks clearly, avoiding confusion and errors.
  5. Subordinates participate in defining the task.
  6. Employees are given full responsibility for the delegated task.
  7. Managers avoid interfering with delegated tasks.
  8. Tasks are delegated to suitable employees.
  9. Adequate support and resources are provided.

Factors Influencing Organizational Structure

  1. Size of the organization
  2. Views of owners or leadership styles
  3. Business objectives
  4. External factors
  5. Changes in technology
  6. The informal structure
  7. Corporate culture