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Stop blaming others and start performing at your highest level.

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Stop blaming others and start performing at your highest level.

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Tracking performance improves performance

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Performance measurement and control systems. It's a hot topic these days-in the business press, in books, in the world of management.

Whether you are managing a call center or internal HR operation...or spearheading a Six Sigma project...or are the president of the United States attempting to cure our health care system, you must master the interrelated concepts of a performance measurement and control system.

The key components of a performance measurement and control system include:

1. Setting realistic expectations that are measurable

2. Thinking through how to continuously capture measuring information

3. Developing strategies and tactics capable of accomplishing clearly defined expected outcomes

4. Monitoring/tracking feedback from actual results

5. Taking corrective action when there is a deviation between actual and predicted results

There are many types of control systems. The basic underpinnings of Management by Objectives, as originally formulated by Peter F. Drucker, involve the application of these five components or steps.

Management's importance, noted Drucker, derives from its two major tasks-deciding what is to be done (for a nation, a business firm, or social service institution) and deciding how to do the job and controlling its execution, and measuring its results.

Weight Control: An Example That's Easy To Understand

A simple example explains better than any theoretical explanation the performance measurement and control process. Say, you want to lose weight.

First, you decide how much weight you want to lose. You are conservative. So you set your target level at three lbs per week.

What did you just do? You set a target level of performance for your weekly weight loss. This is the variable you want to both improve and control.

Most importantly, you have something measurable. It's a performance indicator. You will need a weight loss process to obtain the measurable outcome you desire.

Said Drucker:"To think through the appropriate measurement is in itself a policy decision and therefore highly risky. Measurements, or at least criteria for judgment and appraisal, define what we mean by performance."

Again, you have established a standard or target level of performance. Further, you have also established a unit of measure that works-pounds are a measure of weight.

In short, you set a realistic expectation that is measurable. No fluff. You either lose weight or you don't.

OK, What's Step Two?

You have to decide how you are going to continuously capture measuring information. What's your mechanism for doing this?

You buy or use a scale. Joseph Juran called this a sensor. In short, you need a way to collect information on your performance. How else can you monitor or track if you are succeeding?

So far, you've done two steps-namely, set a realistic expectation that is measurable and figured out a way to continuously capture measuring information. Sounds pretty good. You agree?

Memorize your first two steps! It's easy now. But it gets harder as we progress.

The Third Step Is...

Develop your strategy and tactics for accomplishing your expected outcome, that is, losing three lbs. per week.

A strategy can be defined as a what to do plan to accomplish the outcome you want to achieve (three lbs. per week).

Your strategy would probably sound something like this: "I will exercise more and eat less."

But this is vague and general statement. Really meaningless in terms of action. It says nothing specific. At best, it can be called a good intention.

It tells you what you want to do. But-and this is a big but-it doesn't tell you how to do it.

So, you would probably want to get specific. The specifics can be called your tactical (how-to-do-it) work plan. The tactical plan would probably be put into the form of a list. That list would probably resemble the following:

I will go to the gym four times per week for two hours or more.

I will eat a prescribed diet

Indeed, you may get very specific about your exercise regimen, that is, provide details as to the exact exercises you will perform. And you would probably choose a daily diet routine recommended by a host of experts.

So far so good? You now have your strategy and tactics to accomplish your desired outcome-three lbs. per week. That's your goal.

OK! We Will Proceed to the Forth Step...

Test your comprehension of this process. Assume you've adhered to your strategy and tactical plan. Seven days have passed.

What comes next? After the first week, you'll get a scale and record your weight.

You want to know if the program working? You want to know if your strategy and tactics are paying off.

Let's put this in more highfalutin terms. You want to monitor and track feedback from actual results. This is a fancy way to say: I will weigh myself using a scale every week.

The Final Step...

You compare actual results to hoped-for results. And you are prepared to take corrective action if there is a deviation between actual and expected results.

Oh boy! You followed the strategic and tactical plan perfectly. But regrettably you shed only one lb.

Now, what do you do? What are your options?

Well, you could wait another week. That's a viable option. Or, you could change your strategy and your accompanying work plan.

Or, you could lower your target level or standard of performance.

Sooner or later-assuming you wait another week-you will be down to changing your strategy/tactical work plan or downgrading your expectations.

If you change your strategy/tactical work plan, you could possibly change the number of days you exercise, your specific exercises, time spent exercising and your diet plan. And, then, you would start the procedure just outlined all over again.

We can now introduce some interchangeable words for standard/target level of performance/expectations-namely, desired outcome, predicted result, desired result, expected outcome and several others which crop up from time to time. They all mean the same thing.

Let's Review...

We began with five steps or basic functions vital to the control of any process. For starters, we introduced the concept of setting standards or target levels of performance.

Your target level of performance was to lose three lbs. per week. This could be called your expectation, your desired outcome, your desired result and so on.

We indicated that it was important to select a measurable performance outcome...and one that was capable of being captured with a measuring device (a scale in this case).

We proceeded to developing your strategy and tactics for losing weight. Aha! Next, you were comparing "feedback from actual results. " That is, you were weighing yourself (using a scale) to compare actual weight-loss to your quantified goal of three lbs. per week.

We called this step "comparison of actual performance with targets." Finally, we discussed the general actions available when a major deviation between actual and predicted results occur.

You can lower your goal. Or you can change your strategy and tactics. Your choice.

We strongly advise that you memorize the five steps involved in performance measurement and control. If you memorize it, you'll see how things fit into this framework every day.

Let's Add Some More Drucker Insights...

In the oversimplified "weight control" example, knowing what to measure and how to measure it was quite straightforward. But in actual practice, the performance measurements selected require thought.

Drucker illustrated the fact that the performance measurement selected was equivalent to defining the right problem.

If the wrong measurements are selected but attained, the real problem won't be solved. But it will take years or even decades to realize the wrong problem has been solved.

If the right measurements are selected, but not realized, the strategy and tactics can be changed in the hope of accomplishing the selected measurements.

If the right measurements are in place, it doesn't take very long to evaluate if the strategy and tactics are working.

To repeat: The performance measurement in the weight control example suggests itself. But in most cases the selection of the performance metric is more involved.(Subsequent articles will deal with the problem of defining the problem through performance metrics)

Your Homework Assignment Is...

Evaluate the government's proposed health-care plan using the strategic framework just outlined. Specifically discuss what metrics are being used and whether or not they are the right metrics.

Further, explain the strategies and tactics the government plans to use to accomplish the desired outcomes. Detail how the government will continuously monitor or track results. Elaborate upon the infrastructure that will be created to take corrective action if, indeed, deviations between actual and predicted results occur.

Just kidding. We hope that these are the type of questions that will soon be asked throughout America and to our congressional representatives.

Unfortunately, at this point in time, these questions have not been answered by anyone in government. Perhaps you can share your thoughts with us.

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Introduction to Performance Measurement and Control Systems

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Welcome to the HR Exchange Network, a trusted online news source for more than 70,000 Human Resources professionals and thought leaders. Looking for the latest HR headlines, advice or insights? The HR Exchange Network is dedicated to covering the latest industry news and trends.

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Leadership in film

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This feature on Saving Private Ryan is a section under Leadership Movies, a series of films with leadership themes. Learn about how you can become a better leader by watching leadership in action.

LEADERSHIP MOVIES' RATING: (5 out of 5)

What is the Movie About?

Saving Private Ryan is an academy award winning war movie set during the invasion of Normandy during World War II.

The movie starts with the recollection of a World War II veteran on the beaches of Omaha. After the successful capture of Omaha beach, the men from Easy Company were given a mission to find and evacuate Private Ryan from deep inside enemy lines.

This is a wonderful movie about heroism, brotherhood and sacrifice.

Leadership Takeaways

1. Heroism and Sacrifice
This is a touching story about men who gave their lives for a mission. We can learn so much about sacrificing our own lives for the sake of others from this movie.

2. Brotherhood
The movie also illustrates the value of brotherhood. It shows us the value of watching out for one another and to work out each other's issues together. All of us have our differences but we are united in a common goal.

3. Earn the sacrifice
Many people have sacrificed their time, money and effort so that you can get to where you are today. Never take what you have for granted, and make the sacrifice of others worth it.

Best Movie Quotes

"James... earn this. Earn it." - Captain John H. Miller's dying words to Private James Ryan

"I don't gripe to you, Reiben. I'm a Captain. We have a chain of command. Gripes go up, not down. Always up. You gripe to me, I gripe to my superior officer, and so on and so forth. I don't gripe to you. I don't gripe in front of you. You should know that, as a Ranger." - Captain John H. Miller's response to Private Reiben

"Ours is not to reason why, ours is but to do and die."- Corporal Upham

"You can tell her that when you found me, I was here, and I was with the only brothers I have left. And that there was no way I was deserting them. I think she'd understand that." - Private Ryan

Movie Trailer
Return to Leadership Movies Return to Home Page
Other Leadership Movies

You can find out more about other leadership movies from the list below.
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This feature on Saving Private Ryan is a section under Leadership Movies, a series of films with leadership themes. Learn about how you can become a better leader by watching leadership in action. LEADERSHIP MOVIES' RATING: (5 out of 5) Saving Private Ryan is an academy award winning war movie set during the invasion of Normandy during World War II.

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How to make the most of your most valuable asset.

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A human resource is a single person or employee within an organization and part of the overall personnel or workforce of that company.

Learn more about human resources so you can better understand their role in an effective organization.

What Is a Human Resource?

A human resource is one person within a company's overall workforce, with each person lending their skills and talents to the organization to help it succeed. Any person willing to trade their labor, knowledge, or time for compensation in an effort to improve the organization is a human resource. It doesn't matter if they're part-time, full-time, freelance, or contract employees.

Employees must be hired, satisfied, motivated, developed, and retained. A human resources department is the department that manages a company's human resources. Humans need more management than other resources and a different approach, so that's why it's useful to have an entire department devoted to them. Whether it's mediating interpersonal conflicts or setting up a retirement plan, the human resources department is trained to handle it.

Alternate definition: Human resources is the field that deals with managing people, pay, and training.

Alternate name: Human capital

Acronym: HR

How Does Human Resources Work?

The goal of human resources is to use a company's people most effectively. Human resources might deal with issues such as:

These areas each contribute to employee satisfaction and performance. By attending to these different concerns, human resources can ensure a high-functioning and effective workforce, which in turn helps the company reach its goals and objectives more efficiently.

The human resources department also ensures the company is adhering to labor regulations and works to keeps the environment free from harassment and other impediments to a strong workforce.

For example, imagine Chris is a sales rep for a company. Chris is one of the company's human resources: an employee. If Chris has concerns about her employee benefits or questions about an enrollment form, she would contact the Human Resources department for assistance. If Chris and another employee or manager have a conflict, the human resources department can help find a solution. And the department makes sure that Chris and the other members of her team are receiving appropriate training so that they can perform their duties efficiently.

Criticism of Human Resources

Some people take issue with regarding employees as "resources." In their view, to consider workers as human resources commodifies them and reduces them to a figure on a balance sheet, or a means to an end. Instead, they promote renaming "human resources" to better encourage the full development of the human workforce.﻿﻿

Alternatives to Human Resources

Many of the functions of a human resource may in some cases be executed by non-human resources. In other words, robots or computers sometimes replace human employees, especially in hazardous conditions or for repetitive tasks. This is called automation, and it can greatly improve efficiency.

For example, you may often find robots on production lines, such as for cars. Automating certain parts of the production can increase production speed, but humans are still needed for some tasks, especially those that involve critical thinking.﻿﻿

Human resources functions may also be executed by specialized departments or staff. Instead of a general human resources manager, there may be a compensation and benefits manager, a training supervisor, or an employee recruitment specialist. Such specialization allows for greater efficiency and, often, improved profitability.

Key Takeaways

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A human resource is a single person or employee within an organization and part of the overall personnel or workforce of that company. Learn more about human resources so you can better understand their role in an effective organization.

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Different types of business require different ways of thinking.

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Different types of business require different ways of thinking.

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Choosing the best organizational structure for your company, division, or team is a lot like picking out a new car.

At the most basic level, you're always looking for something road-worthy - something that can take you (and your passengers) from point A to point B without a hitch.

But beyond that, there are a lot of options to consider. Automatic or manual? Four-wheel drive or two? Built-in GPS? Leather interior? Flux capacitor? (Only if you're going back in time, of course.)

In the world of organizational structures, the options you have to choose from include things like chain of command (long or short?), span of control (wide or narrow?), and centralization (centralized or decentralized decision-making?), just to name a few.

What's the point of an organizational structure? As a business leader, do you even need one? As I said, org structures help you define at least three key elements of how your business is going to run.

As your company gets bigger, an organizational structure can also be helpful for new employees as they learn who manages what processes at your company.

Then, if you need to pivot or shift your leadership, you can visualize how the work flows would work by adjusting your organizational structure diagrams.

To put it simply, this chart is like a map that simply explains how your company works and how its roles are organized.

Here's what each of those elements means to an organization:

Chain of Command

Your chain of command is how tasks are delegated and work is approved. An org structure allows you to define how many " rungs of the ladder" a particular department or business line should have. In other words, who tells whom to do what? And how are issues, requests, and proposals communicated up and down that ladder?

Span of Control

Your span of control can represent two things: who falls under a manager's, well, management ... and which tasks fall under a department's responsibility.

Centralization

Centralization describes where decisions are ultimately made. Once you've established your chain of command, you'll need to consider which people and departments have a say in each decision. A business can lean toward centralized, where final decisions are made by just one or two entities; or decentralized, where final decisions are made within the team or department in charge of carrying out that decision.

You might not need an org structure right away, but the more products you develop and people you hire, the harder it'll be to lead your company without this crucial diagram.

(To dive deeper into what all of these different organizational structure components are, check out my earlier post, " The 6 Building Blocks of Organizational Structure.")

In this post, we'll explore how you can combine those components to form different types of organizational structures. We'll also highlight the benefits and drawbacks of different structure types so you can evaluate which is the best option for your company, division, or team. Let's dive in.

Mechanistic vs. Organic Organizational Structures

Organizational structures fall on a spectrum, with "mechanistic" at one end and
"organic" at the other.

Take a look at the diagram below. As you'll probably be able to tell, the mechanistic structure represents the traditional, top-down approach to organizational structure, whereas the organic structure represents a more collaborative, flexible approach.

Here's a breakdown of both ends of the structural spectrum, their advantages and disadvantages, and which types of businesses are suited for them.

Mechanistic Structure

Mechanistic structures, also called bureaucratic structures, are known for having narrow spans of control, as well as high centralization, specialization, and formalization. They're also quite rigid in what specific departments are designed and permitted to do for the company.

This organizational structure is much more formal than organic structure, using specific standards and practices to govern every decision the business makes. And while this model does hold staff more accountable for their work, it can become a hindrance to the creativity and agility the organization needs to keep up with random changes in its market.

As daunting and inflexible as mechanistic structure sounds, the chain of command, whether long or short, is always clear under this model. As a company grows, it needs to make sure everyone (and every team) knows what's expected of them. Teams collaborating with other teams as needed might help get a business off the ground in its early stages, but sustaining that growth - with more people and projects to keep track of - will eventually require some policymaking. In other words, keep mechanistic structure in your back pocket ... you never know when you'll need it.

Organic Structure

Organic structures (also known as "flat" structures) are known for their wide spans of control, decentralization, low specialization, and loose departmentalization. What's that all mean? This model might have multiple teams answering to one person and taking on projects based on their importance and what the team is capable of - rather than what the team is designed to do.

As you can probably tell, this organizational structure is much less formal than mechanistic, and takes a bit of an ad-hoc approach to business needs. This can sometimes make the chain of command, whether long or short, difficult to decipher. And as a result, leaders might give certain projects the green light more quickly but cause confusion in a project's division of labor.

Nonetheless, the flexibility that an organic structure allows for can be extremely helpful to a business that's navigating a fast-moving industry, or simply trying to stabilize itself after a rough quarter. It also empowers employees to try new things and develop as professionals, making the organization's workforce more powerful in the long run. Bottom line? Startups are often perfect for organic structure, since they're simply trying to gain brand recognition and get their wheels off the ground.

Now, let's uncover more specific types of organizational structures, most of which fall on the more traditional, mechanistic side of the spectrum.

Depending on the size of a business and its goals, the organizational structure of the team will vary. Each type has its advantages and disadvantages; however, there is a universal benefit to establishing a clear organizational structure. It helps employees understand their role within a company, which enables them to manage expectations and goals.

A business needs to have an organizational structure in place to be successful. There are several types of organizational structures commonly used by companies, nine of which we expand upon below.

1. Functional Organizational Structure

One of the most common types of organizational structures, the functional structure departmentalizes an organization based on common job functions.

An organization with a functional org structure, for instance, would group all of the marketers together in one department, group all of the salespeople together in a separate department, and group all of the customer service people together in a third department.

The functional structure allows for a high degree of specialization for employees, and is easily scalable should the organization grow. Also this structure is mechanistic in nature - which has the potential to inhibit an employee's growth - putting staff in skill-based departments can still allow them to delve deep into their field and find out what they're good at.
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Disadvantages

Functional structure also has the potential to create barriers between different functions - and it can be inefficient if the organization has a variety of different products or target markets. The barriers created between departments can also limit peoples' knowledge of and communication with other departments, especially those that depend on other departments to succeed.

Advantages

Functional organization increases efficiency, provides stability, and boosts accountability. It allows departments - with employees who share similar skills and knowledge - to focus on their specialized tasks within their respective fields. Because the roles and responsibilities of this organizational structure example rarely change, department employees can consistently work on similar assignments and hone their skills.

The fixed structure of functional organization also operates through management. It provides employees with a chain of command. It guides communication between the team and keeps the team accountable.

2. Product-Based Divisional Structure

A divisional organizational structure is comprised of multiple, smaller functional structures (i.e. each division within a divisional structure can have its own marketing team, its own sales team, and so on). In this case - a product-based divisional structure - each division within the organization is dedicated to a particular product line.

This type of structure is ideal for organizations with multiple products and can help shorten product development cycles. This allows small businesses to go to market with new offerings fast.
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Disadvantages

It can be difficult to scale under a product-based divisional structure, and the organization could end up with duplicate resources as different divisions strive to develop new offerings.

Advantages

Companies and their employees can experience the benefits of the product-based divisional structure. If one division performs poorly, this does not automatically translate across the organization. Because of their separation, divisions may flourish (or fail) concurrently. This system allows companies to mitigate risk.

3. Market-Based Divisional Structure

Another variety of the divisional organizational structure is the market-based structure, wherein the divisions of an organization are based around markets, industries, or customer types.

The market-based structure is ideal for an organization that has products or services that are unique to specific market segments, and is particularly effective if that organization has advanced knowledge of those segments. This organizational structure also keeps the business constantly aware of demand changes among its different audience segments.
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Disadvantages

Too much autonomy within each market-based team can lead to divisions developing systems that are incompatible with one another. Divisions might also end up inadvertently duplicating activities that other divisions are already handling.

Advantages

Because this organizational structure focuses on specific market segments, it provides each division with autonomy. The divisions work separately, which allows employees to work independently and enables them to focus on the needs of their particular industry.

4. Geographical Divisional Structure

The geographical organizational structure establishes its divisions based on - you guessed it - geography. More specifically, the divisions of a geographical structure can include territories, regions, or districts.

This type of structure is best-suited to organizations that need to be near sources of supply and/or customers (e.g. for deliveries or for on-site support). It also brings together many forms of business expertise, allowing each geographical division to make decisions from more diverse points of view.
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Disadvantages

The main downside of a geographical org structure: It can be easy for decision- making to become decentralized, as geographic divisions (which can be hundreds, if not thousands of miles away from corporate headquarters) often have a great deal of autonomy. And when you have more than one marketing department - one for each region - you run the risk of creating campaigns that compete with (and weaken) other divisions across your digital channels.

Advantages

Geographical divisions allow companies the advantage of catering to a specific customer. Based on the differences in language, culture, and customs one would find across the world, companies cannot necessarily expect the same operations to work in different locations. Not only does it allow organizations to tailor their approach based on geography, but it allows the division to react quickly and efficiently to any geographical market changes.

5. Process-Based Structure

Process-based organizational structures are designed around the end-to-end flow of different processes, such as "Research & Development," "Customer Acquisition," and "Order Fulfillment." Unlike a strictly functional structure, a process-based structure considers not only the activities employees perform, but also how those different activities interact with one another.

In order to fully understand the diagram below, you need to look at it from left to right: The customer acquisition process can't start until you have a fully developed product to sell. By the same token, the order fulfillment process can't start until customers have been acquired and there are product orders to fill.

Process-based organizational structure is ideal for improving the speed and efficiency of a business, and is best-suited for those in rapidly changing industries, as it is easily adaptable.
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Disadvantages

Similar to a few other structures on this list, process-based structure can erect barriers between the different process groups. This leads to problems communicating and handing off work to other teams and employees.

Advantages

As mentioned, one of the most significant benefits of the process-based structure is that it increases efficiency and speed. If Department B cannot start its processes until Department A finishes, this compels Department A to work promptly and proficiently. This organizational model also promotes intradepartmental (within the department) and interdepartmental (across multiple departments) teamwork.

6. Matrix Structure

Unlike the other structures we've looked at so far, a matrix organizational structure doesn't follow the traditional, hierarchical model. Instead, all employees (represented by the green boxes) have dual reporting relationships. Typically, there is a functional reporting line (shown in blue) as well as a product- based reporting line (shown in yellow).

When looking at a matrix structure org chart, solid lines represent strong, direct-reporting relationships, whereas dotted lines indicate that the relationship is secondary, or not as strong. In our example below, it's clear that functional reporting takes precedence over product-based reporting.

The main appeal of the matrix structure is that it can provide both flexibility and more balanced decision-making (as there are two chains of command instead of just one). Having a single project overseen by more than one business line also creates opportunities for these business lines to share resources and communicate more openly with each other - things they might not otherwise be able to do regularly.
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Disadvantages

The primary pitfall of the matrix organizational structure? Complexity. The more layers of approval employees have to go through, the more confused they can be about who they're supposed to answer to. This confusion can ultimately cause frustration over who has authority over which decisions and products - and who's responsible for those decisions when things go wrong.

Advantages

An advantage of a matrix structure is that it promotes collaboration and communication. This open line of communication ultimately allows businesses to share resources and allows employees to develop new skills from working with different departments.

7. Circular Structure

While it might appear drastically different from the other organizational structures highlighted in this section, the circular structure still relies on hierarchy, with higher-level employees occupying the inner rings of the circle and lower-level employees occupying the outer rings.

That being said, the leaders or executives in a circular organization aren't seen as sitting atop the organization, sending directives down the chain of command. Instead, they're at the center of the organization, spreading their vision outward.

From an ideological perspective, a circular structure is meant to promote communication and the free flow of information between different parts of the organization. Whereas a traditional structure shows different departments or divisions as occupying individual, semi-autonomous branches, the circular structure depicts all divisions as being part of the same whole.

Disadvantages
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From a practical perspective, the circular structure can be confusing, especially for new employees. Unlike with a more traditional, top-down structure, a circular structure can make it difficult for employees to figure out who they report to and how they're meant to fit into the organization.

Advantages

Most examples of organizational structure have a top-down hierarchy. Alternatively, this type of structure follows an outward flow and contributes to information flowing freely across the business. Its benefits include keeping all employees aligned with the processes and goals of the company and encouraging employees to collaborate between departments.

8. Flat Structure

While a more traditional organizational structure might look more like a pyramid - with multiple tiers of supervisors, managers and directors between staff and leadership, the flat structure limits the levels of management so all staff are only a few steps away from leadership. It also might not always take the form or a pyramid, or any shape for that matter. As we mentioned earlier, It's also a form of the "Organic Structure" we noted above.

This structure is probably one of the most detailed, It's also thought that employees can be more productive in an environment where there's less hierarchy-related pressures. This structure might also make staff feel like the managers they do have are more like equals or team members rather than intimidating superiors.

Disadvantages

If there's a time when teams in a flat organization disagree on something, such as a project, it can be hard to get aligned and back on track without executive decisions from a leader or manager. Because of how complicated the structure's design is, it can be tricky to determine which manager an employee should go to if they need approval or an executive decision for something. So if you do choose to have a flat organization, you should have a clearly marked tier of management or path that employers can refer to when they run into these scenarios.

Advantages

The elimination of middle management employees defines the flat structure type. Its advantages are instantaneous. First, it reduces the expenses of the company. Second, it allows staff to build direct relationships with upper management. And lastly, it shortens the decision-making process.

9. Network Structure

A network structure is often created when one company works with another to share resources - or if your company has multiple locations with different functions and leadership. You might also use this structure to explain your company workflows if much of your staffing or services is outsourced to freelancers or multiple other businesses.

The structure looks nearly the same as the Divisional Structure, shown above. However, instead of offices, it might list outsourced services or satellite locations outside of the office.

If your company doesn't do everything under one roof, this is a great way to show employees or stakeholders how outsourcing of off-site processes work. For example, if an employee needs help from a web developer for a blogging project and the company's web developers are outsourced, the could look at this type of chart and know which office or which person to contact outside of their own work location.

Disadvantages

The shape of the chart can vary based on how many companies or locations you're working with. If it's not kept simple and clear, there may be a lot of confusion if multiple offices or freelancers do similar things. If you do outsource or have multiple office locations, make sure your org chart clearly states where each specific role and job function lies so someone can easily understand your basic company processes.

Advantages

The outsourcing nature of the network structure provides companies with the advantages of lower costs, more focus, and increased flexibility. Outsourcing allows organizations to save money, as they don't have to bear the expense of setting up a department for the same purpose. It also gives companies the flexibility to change their processes and the ability to focus on their core functions.

Why is having an organizational structure important?

Imagine a business that has no organizational structure. Instantly, questions arise about the systems and processes. Who makes the decisions? How are employees held accountable? What are the company's goals? These questions are practically impossible to answer without a functional organizational structure.

Organizational structure is necessary for running a successful business because it improves workflow and efficiency, promotes communication, identifies company needs, and aligns employees with company goals. It directly affects how a business operates daily. When a company establishes a structure that works, the combined efforts of its employees, in conjunction with its systems and processes, allow the company to make better decisions for its future.

Navigating Organizational Structures

Organizational structures are central to a successful team. Employees can move comfortably, confidently, and efficiently when given a clear definition of their role within an organization.

Structure types will vary from business to business, so it's important to remember that these structures are not one size fits all. Every type may not suit your organization, but chances are, one of them will. Use this post to determine which organizational structure works for you, and then it's time for the real work to begin.
Editor's note: This post was originally published in December 2014 and has been updated for comprehensiveness.

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9 Types of Organizational Structure Every Company Should Consider

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Choosing the best organizational structure for your company, division, or team is a lot like picking out a new car. At the most basic level, you're always looking for something road-worthy - something that can take you (and your passengers) from point A to point B without a hitch.

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Different approach, same goal. SUCCEED

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Updated on:

In one of our previous articles, we discussed organizational chart best practices. Now let's take a look at types of organizational charts structures which can be used in different scenarios. And you don't have to worry about creating them too. Our organizational chart software supports all the types mentioned below.

Organizational Structure Types

1) Hierarchical Structure

The hierarchical model is the most popular organizational chart type. There are a few models that are derived from this model.

In a hierarchical organization structure, employees are grouped with every employee having one clear supervisor. The grouping is done based on a few factors, hence many models derived from this. Below are few of those factors

Function - employees are grouped according to the function they provide. The below image shows a functional org chart with finance, technical, HR and admin groups.

Geography - employees are grouped based on their region. For example in USA employees might be grouped according to the state. If it's a global company the grouping could be done according to countries.

Product - If a company is producing multiple products or offering different services it can be grouped according to the product or service.

These are some of the most common factors, but there are many more factors. You can find org chart examples for most of these types in our diagramming community.

This is the dominant mode of organization among large organizations. For example Corporations , Governments , and organized religions are hierarchical organizations with different levels of management , power or authority .

2) Matrix Structure

In a Matrix organizational structure, the reporting relationships are set up as a grid, or matrix, rather than in the traditional hierarchy. It is a type of organizational management in which people with similar skills are pooled for work assignments, resulting in more than one manager to report to (sometimes referred to as solid line and dotted line reports, in reference to traditional business organization charts).

For example, all engineers may be in one engineering department and report to an engineering manager. But these same engineers may be assigned to different projects and might be reporting to those project managers as well. Therefore some engineers might have to work with multiple managers in their job role.

3) Horizontal/Flat Structure

This is an organizational chart type mostly adopted by small companies and start-ups in their early stage. It's almost impossible to use this model for larger companies with many projects and employees.

The most important thing about this structure is that many levels of middle management are eliminated. This enables employees to make decisions quickly and independently. Thus a well-trained workforce can be more productive by directly getting involved in the decision-making process.

This works well for small companies because work and effort in a small company are relatively transparent. This does not mean that employees don't have superiors and people to report. Just that decision making power is shared and employees are held accountable for their decisions.

So in summary, when deciding on the suitable organizational chart, it is important to have an understanding of the current organizational structure of your company.

4) Network Structure

Network organizational structure helps visualize both internal and external relationships between managers and top level management. They are not only less hierarchical but are also more decentralized and more flexible than other structures.

The idea behind the network structure is based on social networks. Its structure relies on open communication and reliable partners; both internal and external. The network structure is viewed as agiler than other structures because it has few tires, more control and bottom flow of decision making.

Using a Network organizational structure is sometimes a disadvantage because of its complexity. The below example of network org chart shows the rapid communication between entities.

5) Divisional Structure

Within a divisional structure, each organizational function has its own division which corresponds to either products or geographies. Each division contains the necessary resources and functions needed to support the product line and geography.

Another form of divisional org chart structure is the multi-divisional structure. It's also known as M-form. It's a legit structure in which one parent company owns several subsidiary companies, each of which uses the parent company's brand and name.

The main advantage of the divisional structure is the independent operational flow, that failure of one company does not threaten the existence of the others.

It's not perfect either. There can be operational inefficiencies from separating specialized functions. Increase in accounting taxes can be seen as another disadvantage.

6) Line Organizational Structure

Line organizational structure is one of the simplest types of organizational structures. Its authority flows from top to bottom. Unlike other structures, specialized and supportive services do not take place in these organizations.

The chain of command and each department head has control over their departments. The self-contained department structure can be seen as its main characteristic. Independent decisions can be taken by line officers because of its unified structure.

The main advantage of a line organizational structure can be identified as the effective communication that brings stability to the organization.

7) Team-based Organizational Structure

Team-based organizational structures are made of teams working towards a common goal while working on their individual tasks. They are less hierarchical and they have flexible structures that reinforce problem-solving, decision-making and teamwork.

Team organization structures have changed the way many industries work. Globalization has allowed people in all industries around the world to produce goods and services cooperatively. Especially, manufacturing companies must work together with the suppliers around the globe while keeping the cost to a minimum while producing high-quality products.

Other Types of Organizational Charts

The ones shown above are the most commonly used org chart structure types or organogram structure types as some call them. But there are plenty more models which have various advantages and disadvantages based on the situation and organization. You can easily experiment with different models using our org chart software.

In a future article, we're hoping to talk about the advantages and disadvantages of using organizational charts. Stay tuned for that article and hope you enjoyed this one.

Have questions? Feel free to ask them in the comments or you can reach to us via our social media channels.

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Types of Organizational Charts | Organization Structure Types for Companies

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Types of organizational charts used across various organizations in many industries. These include the most common org chart structure types plus the various org chart models derived from the main ones. All organizational chart types include editable templates which you can edit and create your own org chart.

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Shop smart. shop S-Mart

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How to write SMART goals (with examples)

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SMART goals are Specific, Measurable, Achievable, Relevant, and Time-Bound. Here, we work through an example of how to write them.

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A step by step guide

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Are resources being distributed equally?

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Are resources being distributed equally?

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Globalization motives are idealistic, as well as opportunistic, but the development of a global free market has benefited large corporations based in the Western world. Its impact remains mixed for workers, cultures, and small businesses around the globe, in both developed and emerging nations.

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What Is Globalization?

Globalization refers to the spread of the flow of financial products, goods, technology, information, and jobs across national borders and cultures. In economic terms, it describes an interdependence of nations around the globe fostered through free trade.

Key Takeaways

Understanding Globalization

Corporations gain a competitive advantage on multiple fronts through globalization. They can reduce operating costs by manufacturing abroad, buy raw materials more cheaply because of the reduction or removal of tariffs, and most of all, they gain access to millions of new consumers.

Globalization is a social, cultural, political, and legal phenomenon.

Socially, it leads to greater interaction among various populations.

Culturally, globalization represents the exchange of ideas, values, and artistic expression among cultures.

Globalization also represents a trend toward the development of a single world culture.

Politically, globalization has shifted attention to intergovernmental organizations like the United Nations (UN) and the World Trade Organization (WTO).

Legally, globalization has altered how international law is created and enforced.

On one hand, globalization has created new jobs and economic growth through the cross-border flow of goods, capital, and labor. On the other hand, this growth and job creation are not distributed evenly across industries or countries.

Specific industries in certain countries, such as textile manufacturing in the U.S. or corn farming in Mexico, have suffered severe disruption or outright collapse as a result of increased international competition.

Globalization's motives are idealistic, as well as opportunistic, but the development of a global free market has benefited large corporations based in the Western world. Its impact remains mixed for workers, cultures, and small businesses around the globe, in both developed and emerging nations.

The History of Globalization

Globalization is not a new concept. Traders traveled vast distances in ancient times to buy commodities that were rare and expensive for sale in their homelands. The Industrial Revolution brought advances in transportation and communication in the 19th century that eased trade across borders.

The think tank, Peterson Institute for International Economics (PIIE), states globalization stalled after World War I, and nations' moved toward protectionism as they launched import taxes to more closely guard their industries in the aftermath of the conflict. This trend continued through the Great Depression and World War II until the U.S. took on an instrumental role in reviving international trade.

One of the critical steps in the path to globalization came with the North American Free Trade Agreement (NAFTA), signed in 1993. One of NAFTA's many effects was to give American auto manufacturers the incentive to relocate a portion of their manufacturing to Mexico where they could save on the costs of labor. NAFTA was replaced in 2020 by the United States-Mexico-Canada Agreement (USMC).

Governments worldwide have integrated a free market economic system through fiscal policies and trade agreements over the last 20 years. The core of most trade agreements is the removal or reduction of tariffs.

This evolution of economic systems has increased industrialization and financial opportunities in many nations. Governments now focus on removing barriers to trade and promoting international commerce.

Pros and Cons of Globalization

Proponents of globalization believe it allows developing countries to catch up to industrialized nations through increased manufacturing, diversification, economic expansion, and improvements in standards of living.

Outsourcing by companies brings jobs and technology to developing countries, which helps them to grow their economies. Trade initiatives increase cross-border trading by removing supply-side and trade-related constraints.

Globalization has advanced social justice on an international scale as well, and advocates report that it has focused attention on human rights worldwide that might have otherwise been ignored on a large scale.

One clear result of globalization is that an economic downturn in one country can create a domino effect through its trade partners. For example, the 2008 financial crisis had a severe impact on Portugal, Ireland, Greece, and Spain. All these countries were members of the European Union, which had to step in to bail out debt-laden nations, which were thereafter known by the acronym PIIGS.

Globalization detractors argue that it has created a concentration of wealth and power in the hands of a small corporate elite that can gobble up smaller competitors around the globe.

Globalization has become a polarizing issue in the U.S. with the disappearance of entire industries to new locations abroad. It's seen as a major factor in the economic squeeze on the middle class.

For better and worse, globalization has also increased homogenization. Starbucks, Nike, and Gap dominate commercial space in many nations. The sheer size and reach of the U.S. have made the cultural exchange among nations largely a one-sided affair.

What Is Globalization and Why Is it Important?

In essence, globalization is about the world becoming increasingly interconnected. Countries today are more connected than ever before, due to factors such as air travel, containerized sea shipping, international trade agreements and legal treaties, and the Internet. In the world of business, globalization is associated with trends such as outsourcing, free trade, and international supply chains. Globalization is important as it increases the size of the global market, and allows more and different goods to be produced and sold for cheaper prices.

Globalization is also important because it is one of the most powerful forces affecting the modern world, so much so that it can be difficult to make sense of the world without understanding globalization. For example, many of the largest and most successful corporations in the world are in effect truly multinational organizations, with offices and supply chains stretched right across the world. These companies would not be able to exist if not for the complex network of trade routes, international legal agreements, and telecommunications infrastructure that were made possible through globalization. Important political developments, such as the ongoing trade conflict between the United States and China, are also directly related to globalization.

Is Globalization Good or Bad?

It depends. Proponents of globalization will point to the dramatic decline in poverty that has taken place throughout the world over the past several decades, which many economists attribute in part to increased trade and investment between nations. Similarly, they will argue that globalization has allowed products and services such as cellphones, airplanes, and information technology to be spread far more widely throughout the world. On the other hand, critics of globalization will point to the negative impact it has had on specific nations' industries, which might face increased competition from international firms. Globalization can also have negative environmental impacts due to economic development, industrialization, and international travel.

How Does Globalization Impact Society?

Globalization has had a large impact on societies around the world, leading to massive migrations from rural to industrial or urban areas, leading to the rapid growth of cities and trade hubs. While this has led to an overall increase in incomes and a higher standard of living in general, it has also led to problems of urbanization including crime, domestic violence, homelessness, and poverty. Concepts of national identity, culture, and consumption patterns also change as goods from around the world become increasingly available and at low prices. The competitiveness of global capitalism may also lead to more individualistic ideals that contradict the cultural orientations of certain, more collectivist societies.

What Is an Example of Globalization?

A simple example of globalization would be a car manufactured in the U.S. that sources parts from China, Japan, S. Korea, Sri Lanka, and South Africa. The car is then exported to Europe, where it is sold to a driver who fills the car's gas tank with gasoline refined from Saudi oil.

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Globalization in Business With History and Pros and Cons

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Globalization is the spread of products, investment, and technology across national borders and cultures.

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Top performers in the global market. As the world shrinks, business grows.

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Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

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Defining test of a companies true CSR.

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Executive Summary

A great many large companies talk about their values, or about how much they care for their employees and other stakeholders. The coronavirus crisis is the time for them to make good on that commitment. The author offers some things that corporations can do to help their employees, small suppliers, health care providers, and communities.

Daniel Grizelj/Getty Images

In these difficult times, we've made a number of our coronavirus articles free for all readers. To get all of HBR's content delivered to your inbox, sign up for the Daily Alert newsletter.

For millions of Americans, the new relief law will be too little too late. It is expected to take three weeks for cash payments to reach laid-off employees and small businesses. Businesses may defer payments and cut costs, but employees who have lost their income without warning cannot wait three weeks to feed themselves and their families. For much of America, this is a crisis that requires immediate action that only companies can take.

The way large companies respond to this crisis is a defining moment that will be remembered for decades. Thirty-eight years ago, seven people in Chicago died from taking poisoned Tylenol pills. It was a rare and localized event, but Johnson & Johnson immediately pulled all Tylenol from all stores everywhere, taking a huge loss to avoid even a single additional death. People still talk about that decision. People who weren't even born at the time are still studying that case in business schools.

A great many large companies talk about having a social purpose and set of values, or about how much they care for their employees and other stakeholders. Now is the time for them to make good on that commitment. Research suggests that people only truly believe that their company has a purpose and clear values when they see management making a decision that sacrifices short-term profitability for the sake of adhering to those values.

When the U.S. drugstore chain CVS chose to go more deeply into health care, it decided that it could no longer sell tobacco products, giving up $2 billion in revenue. When my social-impact-consulting firm, FSG, encountered the 2008 recession, we made a decision not to lay off people, but instead to reduce salaries on a sliding scale so that those who made the most took the deepest cuts and those who made the least took a very minor reduction. More than a decade later, people still talk about that decision - and we have decided to repeat it now.

I understand that corporate leaders face pressure from investors and bankers to conserve cash and reduce losses, but neither investors nor bankers will go hungry. Even retirees, who have seen their savings depleted, can expect to see stocks recover as long as they don't sell in panic. Companies write off the costs of restructuring, product failures, or acquisitions that go wrong all the time. Everyone will understand writing off losses due to the coronavirus pandemic. Here are some things that companies can do to help their employees, small suppliers, health care providers, and communities.

Employees. What companies do to help their laid-off employees - above and beyond what is required or expected - will be remembered and repaid in increased loyalty, higher productivity, and a lasting reputational benefit for many years to come.

Continuing to pay wages, even at less than full pay, is one option. Walmart, Microsoft, Apple, and Lyft have all made commitments to continue payments to hourly workers for at least the first two weeks of lockdown. This is essential not only as a matter of corporate responsibility; it will also substantially reduce the costs of rehiring employees when the economy returns to normal.

Lending money to employees is another option. Left on their own, many employees will turn to the exorbitant charges of credit card debt and payday lenders who will levy a 20%-plus interest rate at a time when corporations can borrow at 2% or 3%. That difference in interest rates can be the difference between bankruptcy and economic survival. Corporations should use their corporate credit and collateral to arrange low- or no-interest loans to their employees. They should calculate employees' take-home pay after payroll deductions, and ask their banks to make loans available equal to a month of net wages at 3% interest, guaranteed by the corporation. Employees can pay the loans back over the next year out of their salaries when they return to work.

In all likelihood, very few of a company's employees will actually require medical care, but if they have no insurance, that too can bankrupt them. Companies should offer to cover the medical expenses of all non-insured employees - probably somewhere between 2% and 5% will actually incur significant bills, and companies can negotiate with their insurer an additional premium to cover them. Sadly, employees may also need help to cover funeral costs for the few who succumb.

Small suppliers. Companies should offer advance payments to their small suppliers, giving them cash today for goods that they will need when they return to production. It's the corporate equivalent of buying gift cards to keep your local store in business.

Health care providers. Some parts of the world face severe shortages in basic medical supplies, but as a global company you have access to resources everywhere. The need for masks in China and South Korea has waned while it is still growing in the United States and Europe. Companies should purchase and ship supplies from where they are available to where they are needed. They should tap their inventory of whatever they have that might help, send it where it will do the most good, and take the loss.

Communities. Major corporations should use their foundations to aid food pantries, free clinics, and other nonprofits in addressing immediate needs of the communities where they have operations.

No one expects or requires major companies to take extraordinary measures to help their many stakeholders, but the bold and creative steps they take today to deliver immediate assistance will define their legacy tomorrow.

If our content helps you to contend with coronavirus and other challenges, please consider subscribing to HBR. A subscription purchase is the best way to support the creation of these resources.

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Coronavirus Is Putting Corporate Social Responsibility to the Test

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Executive Summary A great many large companies talk about their values, or about how much they care for their employees and other stakeholders. The coronavirus crisis is the time for them to make good on that commitment. The author offers some things that corporations can do to help their employees, small suppliers, health care providers, and communities.

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Till they make it.
Do customers really demand a socially responsible company or just cheap, accessible goods

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Despite the widely accepted ideal of "shared value," research led by Harvard Business School's Kasturi Rangan suggests that this is not the norm-and that's OK. Most companies practice a multifaceted version of CSR that spans theaters ranging from pure philanthropy to environmental sustainability to the explicitly strategic. To maximize their impact, companies must ensure that initiatives in the various theaters form a unified platform. Four steps can help them do so:

Pruning and aligning programs within theaters.

Companies must examine their existing programs in each theater, reducing or eliminating those that do not address an important social or environmental problem in keeping with the firm's business purpose and values.

Developing metrics to gauge performance.

Just as the goals of programs vary from theater to theater, so do the definitions of success.

Coordinating programs across theaters.

This does not mean that all initiatives necessarily address the same problem; it means that they are mutually reinforcing and form a cogent whole.

Developing an interdisciplinary CSR strategy.

The range of purposes underlying initiatives in different theaters and the variation in how those initiatives are managed pose major barriers for many firms. Strategy development can be top down or bottom up, but ongoing communication is key.

These practices have helped companies including PNC Bank, IKEA, and Ambuja Cements bring discipline and coherence to their CSR portfolios.

HBR Reprint R1501B

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Despite the widely accepted ideal of "shared value," research led by Harvard Business School's Kasturi Rangan suggests that this is not the norm-and that's OK. Most companies practice a multifaceted version of CSR that spans theaters ranging from pure philanthropy to environmental sustainability to the explicitly strategic.

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Developed the theory of business administration.
Founder of modern management.
Five primary functions of management and fourteen principles of management.

1. Planning

2. Organizing

3. Commanding

4. Co-ordinating

5. Controlling

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Henri Fayol (29 July 1841 - 19 November 1925) was a French mining engineer, mining executive, author and director of mines who developed a general theory of business administration that is often called Fayolism. He and his colleagues developed this theory independently of scientific management but roughly contemporaneously. Like his contemporary Frederick Winslow Taylor, he is widely acknowledged as a founder of modern management methods.

Fayol was born in 1842 in a suburb of Constantinople (now Istanbul). His father (an engineer) was in the military at the time and was appointed superintendent of works to build Galata Bridge, which bridged the Golden Horn. The family returned to France in 1847, where Fayol graduated from the mining academy " École Nationale Supérieure des Mines" in Saint-Étienne in 1860.

That same year, aged 19, Fayol started working at the mining company named " Compagnie de Commentry-Fourchambault-Decazeville" in Commentry, in the Auvergne region. He was hired by Stéphane Mony, who had decided to hire the best engineers from the Saint-Étienne Mining School, and Fayol joined the firm as an engineer and trainee manager. Mony made Fayol his protégé, and Fayol succeeded him as manager of the Commentry mine and eventually as managing director of Commentry-Fourchambault and Decazeville.

During his time at the mine, he studied the causes of underground fires, how to prevent them, how to fight them, how to reclaim mining areas that had been burned, and developed a knowledge of the structure of the basin. In 1888 he was promoted to managing director. During his time as director, he made changes to improve the working situations in the mines, such as allowing employees to work in teams, and changing the division of labor. Later, more mines were added to his duties.

In 1900 Fayol became a member of the Comité Central des Houillères de France, member of the board of the Comité des forges and administrator of the Société de Commentry, Fourchambault et Decazeville. Eventually, the board decided to abandon its iron and steel business and the coal mines. They chose Henri Fayol to oversee this as the new managing director. Upon receiving the position, Fayol presented the board with a plan to restore the firm. The board accepted the proposal. At that time, the company was at the verge of bankruptcy. With rich and broad administrative experience, Fayol contributed a lot in turning the fortune of the company. When he retired in 1918, the company was financially strong and one of the largest industrial combines in Europe.

Based largely on his own management experience, he developed his concept of administration. In 1916 he promoted his ideas in Administration Industrielle et Générale, at about the same time as Frederick Winslow Taylor published his Principles of Scientific Management. After his retirement he became the Director of the Centre of Administrative Studies in Paris.

Fayol's work became more generally known with the 1949 publication of "General and industrial administration", the English translation of the 1916 work "Administration industrielle et générale". In this work Fayol presented his theory of management, known as Fayolism. Before that Fayol had written several articles on mining engineering, starting in the 1870s, and some preliminary papers on administration.

Mining engineering

Starting in the 1870s, Fayol wrote a series of articles on mining subjects, such as on the spontaneous heating of coal (1879), the formation of coal beds (1887), the sedimentation of the Commentry, and on plant fossils (1890).

His first articles were published in the French Bulletin de la Société de l'Industrie minérale, and beginning in the early 1880s in the Comptes rendus de l'Académie des sciences, the proceedings of the French Academy of Sciences.

Fayol's work was one of the first comprehensive statements of a general theory of management. He proposed that there were six types of organisational activity, including management as one of these, five primary functions of management and fourteen principles of management.

Types of organisational activity

Fayol divided the range of activities undertaken within an industrial undertaking into six types:

technical activities

commercial activities

financial activities

security activities

accounting activities, and

managerial activities.

Functions of management

In his original work, Administration industrielle et générale; prévoyance, organisation, directing, coordination, controle, five primary functions were identified:

The control function, from the French contrôler, is used in the sense that a manager must receive feedback about a process in order to make necessary adjustments and must analyze the deviations. Lately scholars of management combined the directing and coordinating function into one leading function.

Principles of management

1. Division of work - In practice, employees are specialized in different areas and they have different skills. Different levels of expertise can be distinguished within the knowledge areas (from generalist to specialist). Personal and professional developments support this. According to Henri Fayol specialization promotes efficiency of the workforce and increases productivity. In addition, the specialization of the workforce increases their accuracy and speed. This management principle of the 14 principles of management is applicable to both technical and managerial activities.

2. Authority and Responsibility - According to Henri Fayol, the accompanying power or authority gives the management the right to give orders to the subordinates.

3. Discipline - This principle is about obedience. It is often a part of the core values of a mission and vision in the form of good conduct and respectful interactions.

4. Unity of command - Every employee should receive orders from only one superior or behalf of the superior.

5. Unity of direction - Each group of organisational activities that have the same objective should be directed by one manager using one plan for achievement of one common goal.

6. Subordination of Individual Interest to General Interest - The interests of any one employee or group of employees should not take precedence over the interests of the organisation as a whole.

7. Remuneration - All Workers must be paid a fair wage for their services. The wages paid must be as per a certain standard of living to the employee at the same time it is within the paying capacity of the company.

8. Centralization and Decentralization - This refers to the degree to which subordinates are involved in decision making.

9. Scalar chain - The line of authority from top management to the lowest ranks represents the scalar chain. Communications should follow this chain. However if someone needs to communicate some other person in emergency he/she might use "Gang Plank". ≤Fayol suggested the concept of 'Gang Plank' to avoid delays and allow direct communication between two subordinates at the same level.≥

10. Order - this principle is concerned with systematic arrangement of men, machine, material etc. There should be a specific place for every employee in an organization. That is 'a place for everything (people) and everything has a place'.

11. Equity - All the employees in the organization must be treated equally with respect to the justice and kindliness.

12. Stability of tenure of personnel - High employee turnover is inefficient. Management should provide orderly personnel planning and ensure that replacements are available to fill vacancies.

13. Initiative - Employees who are allowed to originate and carry out plans will exert high levels of effort.

14. Esprit de corps - Promoting team spirit will build harmony and unity within the organization.

Some Fayolian principles still influence some contemporary management theories to a certain degree.

Books, translated

IN 1930, Industrial and General Administration. Translated by J.A. Coubrough, London: Sir Isaac Pitman & Sons.

1949. General and Industrial Management. Translated by C. Storrs, Sir Isaac Pitman & Sons, London.

Articles, translated, a selection

1900. "Henri Fayol addressed his colleagues in the mineral industry 23 June 1900." Translated by J.A. Coubrough. In: Fayol (1930) Industrial and General Administration. pp. 79-81 (Republished in: Wren, Bedeian & Breeze, (2002) "The foundations of Henri Fayol's administrative theory")

1909. "L'exposee des principles generaux d'administration". Translated by J.D Breeze. published in: Daniel A. Wren, Arthur G. Bedeian, John D. Breeze, (2002) "The foundations of Henri Fayol's administrative theory", Management Decision, Vol. 40 Iss: 9, pp. 906 - 918

1923. "The administrative theory in the state". Translated by S. Greer. In: Gulick, L. and Urwick. L. Eds. (1937) Papers on the Science of Administration, Institute of Public Administration. New York. pp. 99-114

1. ^ Morgen Witzel (2003). Fifty key figures in management. Routledge, 2003. ISBN 0-415-36977-0, p.96.

2. ^ Wren, D.A. (2001). "Henri Fayol as a strategist: a nineteenth century corporate turnaround". Management Decision. 39 (6): 475-487. doi:10.1108/EUM0000000005565.

3. ^ Wood, John C.; Wood, Michael C. (2002), Henri Fayol: Critical Evaluations in Business and Management, Taylor & Francis, ISBN 978-0-415-24818-1

4. ^ Voxted, S., "100 years of Henri Fayol", Management Revue, Volume 28, No. 2 (2017), pp. 256-274, accessed 14 February 2021

5. ^ Daniel A. Wren, Arthur G. Bedeian, John D. Breeze, (2002) "The foundations of Henri Fayol's administrative theory", Management Decision, Vol. 40 Iss: 9, pp.906 - 918 state: "It was not until the Storr's translation that Fayol's (1949) Administration Industrielle et Générale reached a wider audience, especially in the USA and established Fayol as a major authority on management."

6. ^ The first English translation by J.A. Coubrough in 1930 didn't have that much impact. The first translation in German was published around the same time in 1929.

7. ^ Derek Salman Pugh, David John Hickson (2007) Great Writers on Organizations: The Third Omnibus Edition, p.144

8. ^ Fayol, Henri (1917), Administration industrielle et générale; prévoyance, organisation, commandement, coordination, controle (in French), Paris, H. Dunod et E. Pinat, OCLC 40224931

9. ^ Pryor, J.L.; Guthrie, C. (2010). "The private life of Henri Fayol and his motivation to build a management science". Journal of Management History.

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Henri Fayol (29 July 1841 - 19 November 1925) was a French mining engineer, mining executive, author and director of mines who developed a general theory of business administration that is often called Fayolism. He and his colleagues developed this theory independently of scientific management but roughly contemporaneously.

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Order - this principle is concerned with systematic arrangement of men, machine, material etc. There should be a specific place for every employee in an organization. That is 'a place for everything (people) and everything has a place

Corporate hierarchy refers to the arrangement and organization of individuals within a corporation according to power, status, and job function. It delineates authority and responsibility, designating leadership over employees, departments, divisions, and other executives depending on their place within the strata