Thursday, July 30, 2009

Streamlining the Organization

Organization X used this chain of command to handle a critical project:

Chief Executive Officer
Special Project Advisor
1st Vice President
2nd Vice President
Regional Vice President
Department Director
two Local Managers who had direct contact with the problem.

Result? Extraordinary communication problems and confused authority in the field produced a disaster.

Organization Y used this chain of command in a similar situation:

Chief Executive Officer
Local Manager.

[The 1st Vice President was available for assistance regarding resources.]

Organization Y also had a complex chain of command under normal circumstances, but they reduced it in order to handle the pressing project more effectively. By doing so, they put the ultimate decision maker in touch with the decision maker who was on the scene.

Result: Clarity and success.


pawnking said...

Ah, you neglected to add an important element to the results: prestige!

In your Organization X, the CEO did not have to be seen communicating with the common folk, and therefore can view his time as being very important, and worth his high salary. In Organization Y, people may see the CEO interacting with a manager who makes only 1/10 of his salary, and they may wonder why he’s wasting his time with such unimportant people.

The result for the company may be much better for Organization Y, but the result for the CEO for Organization X is arguably superior.

Rob said...

I would argue if it's important or urgent enough for the CEO to want or need to make the final decision then they should manage the project. If not they should delegate the decision to somebody else, you have to have trust and faith in those below you, if you don't you need new people. I always remember the advice of a goal that although was realistically unachievable, was none the less worth pursuing, that is the role of a manager should be to make themselves redundant.