Determining Span of Control

Span of Control
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Kharen

Determining Span of Control

When should we add more subordinates? In other words, how can one determine the right span of control?

  David Wilson
Manager, Canada
 

Determining Span of Control

Hi Kharen:

There is no magical formula or perfect answer. Determining when to add subordinates will vary from organization to organization, depending on the model and variables used. Factors, such as the number of new or total customers, increase or total revenue/position, nature of the staff supervised, number of organizational layers, etc.

In one organization where I worked, a "consolidated administrative position (CAP)" formula was used to link the number of operational staff to the number of clients, and then built the organization based on the operational numbers. For example, there was one Operational Supervisor for every 10 operational staff, and one manager for every 8-10 Supervisors, etc. Support staff (e.g., HR, Finance, IT, Purchasing) were added based on the same type of concept (e.g., one HR position for every 100 operational positions, one IT position for every 200 operational positions, etc.).

Many organizations use the concept of FTEs (or Full Time Equivalents) versus the total number of positions (where the positions are only part-time). Researching industry best practices and benchmarking is also very useful. If your organization has more staff than another competitor, it may want to control issues such as span of control and number of organizational levels.

I would also recommend you review to technical papers:
1. The Relationship Formulas of V. A. Graicunas as outlined in a paper published under the title "The Manager's Span of Control" by Urwick, L.F. Harvard Business Review, 1956); and
2. "The Determination of Span of Control (2006)" by Marian Hopej and Janusz Martan.

Your organization will need to examine and consider budget costs versus revenue/profit, customer satisfaction and the nature of the organization's services. For organizations requiring lower level positions, the span of control might be wider (e.g., one foreman with 20 labourers and equipment operators) than an organization with more complex positions (e.g., one Supervisor with 5 technicians and 5 engineers), the span of control might be narrower.

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