This is also called span of management, span of authority, span of supervision, span of authority, span of responsibility or levels of organization. This principle is based on the principle of relationship.
The skills necessary for entrepreneurship are quite different from that of running a large and diverse organization, large organizations requires more concern for people, controlling specialized departments and a talent for sensing issues buried deep in the organization.
Why organizations strive for growth? Organizations grow their revenue by increasing their customer base, as a consequence, the product and services need more changes and support.
To serve the customer better, the organization has to employee more resources. Small organizations are more easily affected by the sudden changes in the external environment; hence the business leaders feel compelled to grow or perish.
Growth ensures that the organization has better control over the necessary external resources like raw material, skilled workers and technological advancement. Growth also ensures that the organization can compete globally, can penetrate new markets and can provide good service and influence customer loyalty.
Big organization can invest in complex products, has means to control cost and can be aggressive in marketing strategies. All such measures result in stabilizing the market in long term and act as deterrent to new entrants.
Having several products and technologies provides better market intelligence for new products and changing customer preferences.
It ensures that while older products lose market share and turn out to be obsolete, the newer are in queue to replace them. A growing organization provides exciting and vibrant work environment, better career growth opportunities and can attract best available brains.
It should be noted that a growth is the stage of becoming large, once it has attained the large status, it may get stagnant and might only provide a long and stable career.
Characteristics of organizational size Technology required to produce the product is major determinant of size, an airplane, space shuttles, communication satellites, cable bridges, a sport stadium etc require technology that requires a large number of people.
Hence both technology and size are interrelated and influence the structure of the organization. Amount of task specialization increases with size, the work design is focused and require individuals and teams to deliver a well defined quality of task. Management hierarchy grows with size: Increased size results in more specialization and decentralization of decision making, the tasks are delegated to teams and are managed by the lower level managers or supervisors.
The span-of-control discussed later, makes it necessary to add more management layers for better control of resources and inter-organizational interactions. The rate at which the size influences the organizational structure decreases as the size increases, thus the impact of size increase in more in a small organization.
Job satisfaction decreases as the size increases, more specialization and focused work design causes an increase in peer competition; thereby reduces the career growth opportunities.
Differences between large and small organizations Large.Management is about leverage.. Most people work on a ratio of They work for an hour and they get one hour’s productivity. Managers have to get far more leverage from their time than As an organization grows in size, it either needs more managers to control the productivity, thereby adding layers of management hierarchy, or it increases the span-of-control, increasing exponentially the management complexity.
Energy Management & Mechanical Services. Canada Post. As one of Canada Post’s largest service centers in Ontario this commercial facility required a comprehensive structural heating and cooling system assessment.
Definition: The Span of Management refers to the number of subordinates who report directly to a manager. Factors Determining Span of Management The span of management can be determined on.
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Time management series Time management.
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