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Company Organization
34
Company Organization
Regardless of a company’s size in terms of head count, there are several ways in which they can structure their workforce. Although in small start-up companies, it is not unusual to find everyone reports to the boss/manager/owner as in a wheel organization (Fig. 34.1). This is a convenient, rapid response approach when there are no actual departments comprised of multiple employees. There is no attempt to create a measurement or level of responsibility between employees. Also there is reluctance on the part of employees to act without consent of the boss. When the head count exceeds a dozen or so employees, it is time to consider alternative structures. The most common organization is the line organization (Fig. 34.2). This organization structure is utilized in small, medium, and large technological companies. The line organization diagram shows levels of authority or seniority vertically (chain of command) and simultaneously shows peer or similar ranking horizontally. Line organizations tend not to be broad horizontally as there is usually a practical limit to the functions or departments required, i.e., engineering, manufacturing, sales, administration, etc. Whereas vertically, the experience of subordinates will determine the number that can effectively report to the supervisor. In other words, less supervision is required for senior level personnel.
Sales Eng.
Machinist
Machinist
Engineer
Manager Owner
Administrator
Figure 34.1 Wheel organization.
Technical Career Survival Handbook. http://dx.doi.org/10.1016/B978-0-12-809372-6.00034-7 Copyright © 2017 Elsevier Inc. All rights reserved.
Engineer
Technician
Technician
88
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Figure 34.2 Line organization.
Medium and large companies will have line organization charts for each department, i.e., engineering, marketing, sales and manufacturing, and so on. Collectively, they define the company organization structure. Actual names would normally be inserted in the diagrams (Fig. 34.3). This is an alternative organization structure that focuses more on the tasks or projects usually associated with products that a company produces. The primary advantage of this product/project organization is that members of each product line are simply focused on the success of the single product and attention is not diverted to other lines. Thus, team members have specialties and backgrounds associated with the specific products and are hence experts. There is also a competitive atmosphere, which is created between the product lines that inherently leads to successful results. On the negative side, unless there is sufficient cross training, the departure of a team member may create a serious void and disrupt progress of that product marketing effort. Product/project organizations tend to be broad horizontally because both products and projects may be numerous. ITAC, a consulting engineering company that I worked for part time for at one point had as many as 11 departments reporting to the president. One department consisted of 21 employees under a single manager. Again, because consulting engineering companies tend toward employing more experienced personnel, less supervision per employee is required. A hybrid organization, sometimes referred to as a matrix organization, is created when the line organization is combined with the product/project structure on a temporary basis. This is typically used for consulting engineering companies where multiple projects are encountered in the normal course of business. This structure requires a project manager be assigned for the duration of the project, let us say 6 months. For the project duration, a mechanical engineer, mechanical designer, a civil engineer, and a civil designer are temporarily assigned to the project. While working on the project, the team members continue to report to their respective discipline supervisors/
Company Organization
89 PRODUCT MANAGER
A-LINE SUPERVISOR
B-LINE SUPERVISOR
C-LINE SUPERVISOR
SR. ENGINEER
Engineer
SENIOR ENGINEER
Engineer
DESIGNER
DESIGNER
DESIGNER
Figure 34.3 Product organization.
managers although they receive project-related work direction (dotted line) from the project manager. This requires the project manager, sometimes referred to as the program manager, has an understanding of the team member’s capabilities and a reasonable expectation of their abilities to complete the work. At the conclusion of the project, the discipline managers should collaborate with the project manager to assess the job performance of the team members in preparation for their annual performance reviews. The key to success with the hybrid organization is team members must be self-starting and require a minimum amount of supervision in their discipline. Normally, there is no need to move personnel work spaces within the office for the sake of the temporary assignment. Song: “Never Know” As popularized by: Jack Johnson 2008
Company Organization
Regardless of a company’s size in terms of head count, there are several ways in which they can structure their workforce. Although in small start-up companies, it is not unusual to find everyone reports to the boss/manager/owner as in a wheel organization (Fig. 34.1). This is a convenient, rapid response approach when there are no actual departments comprised of multiple employees. There is no attempt to create a measurement or level of responsibility between employees. Also there is reluctance on the part of employees to act without consent of the boss. When the head count exceeds a dozen or so employees, it is time to consider alternative structures. The most common organization is the line organization (Fig. 34.2). This organization structure is utilized in small, medium, and large technological companies. The line organization diagram shows levels of authority or seniority vertically (chain of command) and simultaneously shows peer or similar ranking horizontally. Line organizations tend not to be broad horizontally as there is usually a practical limit to the functions or departments required, i.e., engineering, manufacturing, sales, administration, etc. Whereas vertically, the experience of subordinates will determine the number that can effectively report to the supervisor. In other words, less supervision is required for senior level personnel.
Sales Eng.
Machinist
Machinist
Engineer
Manager Owner
Administrator
Figure 34.1 Wheel organization.
Technical Career Survival Handbook. http://dx.doi.org/10.1016/B978-0-12-809372-6.00034-7 Copyright © 2017 Elsevier Inc. All rights reserved.
Engineer
Technician
Technician
88
Technical Career Survival Handbook 0DQDJHU RZQHU
7HFK6DOHV 6XSHUYLVRU
0DQXIDFWXULQJ 6XSHUYLVRU
(QJLQHHULQJ 6XSHUYLVRU
,QVSHFW 7HVW 6XSHUYLVRU
6DOHV(QJLQHHU 1RUWK
7HFKQLFLDQ
65(QJLQHHU
7HFKQLFLDQ
6DOHV(QJLQHHU 6RXWK
7HFKQLFLDQ
&KHPLFDO (QJLQHHU
7HFKQLFLDQ
6DOHV(QJLQHHU :HVW
+XPDQ5HVRXUFH $GPLQLVWUDWRU
'HVLJQHU
'HVLJQHU
Figure 34.2 Line organization.
Medium and large companies will have line organization charts for each department, i.e., engineering, marketing, sales and manufacturing, and so on. Collectively, they define the company organization structure. Actual names would normally be inserted in the diagrams (Fig. 34.3). This is an alternative organization structure that focuses more on the tasks or projects usually associated with products that a company produces. The primary advantage of this product/project organization is that members of each product line are simply focused on the success of the single product and attention is not diverted to other lines. Thus, team members have specialties and backgrounds associated with the specific products and are hence experts. There is also a competitive atmosphere, which is created between the product lines that inherently leads to successful results. On the negative side, unless there is sufficient cross training, the departure of a team member may create a serious void and disrupt progress of that product marketing effort. Product/project organizations tend to be broad horizontally because both products and projects may be numerous. ITAC, a consulting engineering company that I worked for part time for at one point had as many as 11 departments reporting to the president. One department consisted of 21 employees under a single manager. Again, because consulting engineering companies tend toward employing more experienced personnel, less supervision per employee is required. A hybrid organization, sometimes referred to as a matrix organization, is created when the line organization is combined with the product/project structure on a temporary basis. This is typically used for consulting engineering companies where multiple projects are encountered in the normal course of business. This structure requires a project manager be assigned for the duration of the project, let us say 6 months. For the project duration, a mechanical engineer, mechanical designer, a civil engineer, and a civil designer are temporarily assigned to the project. While working on the project, the team members continue to report to their respective discipline supervisors/
Company Organization
89 PRODUCT MANAGER
A-LINE SUPERVISOR
B-LINE SUPERVISOR
C-LINE SUPERVISOR
SR. ENGINEER
Engineer
SENIOR ENGINEER
Engineer
DESIGNER
DESIGNER
DESIGNER
Figure 34.3 Product organization.
managers although they receive project-related work direction (dotted line) from the project manager. This requires the project manager, sometimes referred to as the program manager, has an understanding of the team member’s capabilities and a reasonable expectation of their abilities to complete the work. At the conclusion of the project, the discipline managers should collaborate with the project manager to assess the job performance of the team members in preparation for their annual performance reviews. The key to success with the hybrid organization is team members must be self-starting and require a minimum amount of supervision in their discipline. Normally, there is no need to move personnel work spaces within the office for the sake of the temporary assignment. Song: “Never Know” As popularized by: Jack Johnson 2008