The Cost of Vertically Misaligned Management
Published by admin on Wed, 01/22/2014 - 09:31
Unnatural organizational layering results in gaps and compressions between managers and their direct reports. The resulting impact comes right off the bottom line.
Tell me if you’ve experienced either of these:
Both these examples are indications of vertically misaligned management. These are instances where the manager-direct report relationship works contrary to natural and logical organizational layering. The nature of a managerial hierarchy is such that each level of management should add value to the level below, and that all managers should be functioning one level higher than their direct reports. When this doesn’t occur, as in the cases above, effectiveness, efficiency and trust within the organization is compromised.
Imagine an old time factory assembly line with 5 steps in the assembly. The first employee launches a new item into the process. This allows the next in line to build on the work of the first, allowing the next in line to build further, and so on. Employees at each step in the process are required to perform a specific, discrete and un-interchangeable task and by doing so, enable the employee at the next step to complete his or her work.
This is a logical and natural system that requires each employee doing particular work in a particular order. If there is a step that is unoccupied, then the system is compromised. If there are two employees occupying the same step, then there is inefficiency and confusion as to who adds the part, and again the system is compromised.
Now imagine tilting that assembly line so that it is vertical instead of horizontal. What you see is the layering of an organization, where Managers at each layer, from the CEO down, have a specific type of work to do and in so doing are adding value to the next level down.
But, when a Manager and Direct Report occupy the same layer, as in example 1 above, it creates a “compression” – the two roles are doing the same type of work. And when there is a missing layer, as in example 2, it results in a “gap” between Manager and Direct Report – the two roles too far apart. Do you recognize the symptoms below?
Symptoms of Compression
Symptoms of Gaps
If you consider misalignment – either compressions or gaps – in terms of the percentage of time an individual or team misspends due to these impacts, you can then link that time to percentage of salary. The result is the precise dollar amount that a gap or compression costs your organization.
In the next issue of Forrest Fire, we’ll talk about the nature of work at each layer in a managerial hierarchy.
Until then, I’d like you to think about the number of layers in your organization. Can you count them all? What makes each layer distinct from the next? And while you’re at it, can you distinguish the work of, say, a manager and a director, or a director and a VP?