Management spans and layers
One of the most obvious sources of organizational cost reduction is to reduce the number of managers by increasing the average number of people reporting to each manager. After a long economic boom, many companies have managers with only 1, 2 or 3 people reporting to them. Most modern ERP systems will give you the average ratios of your management spans for different organizational units. But how can you act on this information to move from a ratio of, say, 1:4 to 1:7?
Our software provides you with an instant cost reduction estimate by considering not only the ratios but also the nuances of geography, new businesses, and different types of unit. It enables you to benchmark yourself against thousands of existing data points, set target spans of controls and identify the precise managers who fall outside your target: not only those with too few reports; but also those with too many (who are therefore not shaping their team’s activities). Our Org Modeller workflow tool then enables you to plan and manage the changes required.