Describes the various forms of communications methods and management hierarchies commonly used in business, such as Vertical Structure, Small Span of Control, Theory X, Y and Z, Decision-making structure and others.

1. Structure and Communication
By Christina Strong
Katie Amann
Greg Monahan

2. What is Structure?
• According to businessdictionary.com, structure
is:
“The typically hierarchical arrangement of lines of
authority, communications, rights and duties of an
organization. Organizational structure determines
how the roles, power and responsibilities are
assigned, controlled, and coordinated, and how
information flows between the different levels of
management.”
Source: http://www.businessdirectory.com/definition/organizational-
structure.html

3. Examples of Structures
• Movie Studios
Corporate structure: Investors-Management-
Employees

4. Vertical Structure
• Vertical (or tall) companies have a chain of
management. CEO’s make most decisions and
delegate authority to lower-level managers
Advantages
• Easier to manage
• Well-defined
responsibilities for
employees
Disadvantages
• Requires a strong
upper management
• Lacks transparency
Source: smallbusiness.chron.com/vertical-structure-vs-horizontal-structure-
organization-4904.html

5. Horizontal Structure
Horizontal (or flat) structure lacks middle managers. High
level managers handle day-to-day tasks of business, deal
with customers and front line employees
Advantages
• Better employee
moral
• Less red tape
• Cheaper to run an
organization
Disadvantages
• Harder to implement
• Less certainty about
roles within the
company
• Project managers may
be frustrated by lack of
authority
Source: smallbusiness.chron.com/vertical-structure-vs-horizontal-structure-organization-
4904.html

6. Virtual Structure
Uses the horizontal structure approach but
brings together people across different
geographically regions to complete work.

7. Business Unit
A business unit is a division, department or functional
area within a company responsible for a specific
corporate activity e.g, marketing, accounting, etc.

8. Subsidiary
“Organizations that own or control other companies
may operate a subsidiary structure. The subsidiaries
report to a holding company and are responsible for
their own profit and loss accounts.
i.e., DanJaq, LLC controls Eon Productions the
corporation that produces the James Bond franchise.
Source: http://smallbusiness.chron.com/business-organizational-structure-
examples-20580.html

9. According to an article in the Houston Chronicle
“What Is the Difference Between an Informal &
Formal Organization?”…
• “A formal organization
is the literal structure of
the organization
including its
organization chart,
hierarchical reporting
relationships and work
processes.”
• “The informal
organization, often
called the grapevine, is
the informal working
relationships that
develop in organizations
and contribute strongly
to the work culture.”

10. Informal Structure
• i.e. Editors and reporters.
- Reporter writes the story and copyeditor reviews it.
Prior to submission a fellow reporter may have another
reporter or two that offers an opinion on the writing
before it is officially submitted to the copyeditor.
• i.e., An editor asks a top award winning reporter if they
think a story is worth covering
- Hierarchy dictates the editor chooses but instead
reverses the decision by asking a “leader” in their news
team if a story should be covered.
• i.e. Brainstorming screenwriting meeting
- Not an official meeting, but a gathering every week to
help screenwriters develop ideas in a production
company.

11. 5 Important Advantages of Informal
Organization
1. Employees develop some cohesiveness among each other.
2. Creates a sense of “belonging.”
3. Helps employees help each realize their role expectations
and help each other with their work.
4. Reduces fear toward top management and creates
interdependence among employees.
5. Information spreads quicker through the “grapevine.”
Source: http://www.preservearticles.com/2012051832417/5-important-advantages-of-
informal-organisation.html

12. From an article titled, Informal and Formal Need Each
Other”…“The concept of the "informal organization"
transcends the limits of business. Some of the most
vibrant examples of the power of informal organizations
are from the non-business world: the Underground
Railroad, the back channels of lobbying and influence in
the U.S. Congress, the Mafia, and the rumor mill at your
child's middle school. All of these are examples of
organic, informal networks…. motivating people to go
above and beyond their job duties, communicating
information quickly, engaging employees in collaborative
work, and making changes stick. The informal structure is
the complex web of relationships, influences,
interactions, and judgment calls that make a company
what it is.”
http://www.booz.com/informalorg/informal_formal_need_each_other
Benefits of Formal and Informal Structures

13. Benefits of Formal and Informal
Structures
• From an article titled, Informal and Formal
Need Each Other”…”Formal is good at:
creating efficiency, clarifying authority,
communicating priorities, and aligning the
rational behaviors of an organization's
employees with its common objectives. The
formal organization is the lines and boxes that
illustrate the official structures of power and
paths of decision-making.”
Source:
http://www.booz.com/informalorg/informal_formal_need_each_other

14. Decision-making Structure
• Decisions come from the top, and are
delegated outward to a larger amount of
employees
– Most important or essential rules or guidelines are
put in by corporate office, but a large amount of
other decisions are left up to middle managers
– Managers need to make sure decisions that are
made are enforced at a lower level

15. Decision-making Structure
• “Downward flow of communication is
intended to allow managers to control and
coordinate organizational efforts in the
interests of efficiency.” (Yates, 1984)
http://dspace.mit.edu/bitstream/handle/1721.1/48239/internalcommunic00yate.pdf

16. Organization Chart
Source:http://www.scribd.com/doc/95768318/Newspaper-
Organizational-Chart (Scribd)

17. Structure
• Trayvon Martin
– Misleading studio edit by producer fired by the higher
ups in the NBC News organization
– Structure is there to make sure the incident with the
Trayvon Martin 9-11 call don’t happen all the time.
The structure is there to make sure things operate
correctly.
– Youtube video: http://youtu.be/c8WSN9GUIuo
Source: Source:
http://www.csmonitor.com/Commentary/Opinion/2013/0722/How-TV-news-
failed-Trayvon-Martin-George-Zimmerman-and-American-people

18. Discussion
• Do you think it’s more important for an
organization to have a formal or informal
structure? Or a balance of both?

19. Span of Control
Span of Control (or Span of Management) is the
number of people reporting to a manager.
- a smaller span of control = more personal
contact between managers and the daily
activities of employees

20. Example of Large Span of Control
Manager
Employee Employee Employee Employee Employee Employee Employee
• A large span of control leads to a
horizontally structured or flat company

21. Small Span of Control
Department
Head
Manager
Employee Employee
Manager
Employee Employee
• A small span of control leads to a
vertically structured or tall company

22. Determining the Optimal Span of
Control
To determine the optimal span of control,
companies must consider several factors.
1) Coordination within a unit
2) How specialized or similar tasks are
3) Type of information group members know or
need
4) Need for autonomy
5) Need for access to the supervisor

23. Theories X, Y & Z
Theory X and Y video
http://youtu.be/6qm_3saEo7o

24. Theories X, Y & Z are Management Styles

25. Theory X
•Lazy
•Dislikes work
•Works need to be controlled and supervised carefully
•Hierarchical structure is needed
Source: http://en.wikipedia.org/wiki/Theory_X_and_Theory_Y

26. Theory Y
• Ambitious
• Self-motivated
• Enjoy their work
• Creative problem-solvers
• Will see more responsibility & be able to guide
themselves successful completion of their
work.
Source: http://en.wikipedia.org/wiki/Theory_X_and_Theory_Y

27. Theory Y
• Newsweek Karl Guide formal graphics designer during a
talk in 2012 at the Kellogg Center described incidents
during the World Trade Center. He described one journalist
as utilizing a phone at a restaurant then hijacking the
phone behind a counter to get details to her paper about
what was happening on the ground since her cell phone
was not working properly because of the all the issues and
cellular usage occurring at that time.
• Driven to do work
• Self-guided
• Enjoys work (did not lose her cool)
• Creative in problem solving
Source: http://en.wikipedia.org/wiki/Theory_X_and_Theory_Y

28. Theories X, Y & Z are Management
Styles
Theory Z
Dr. William Ouchi's (“Japanese Management Style”)
“Theory Z focused on increasing employee loyalty to
the company by providing a job for life with a strong
focus on the well-being of the employee, both on and
off the job. According to Ouchi, Theory Z management
tends to promote stable employment, high
productivity, and high employee morale and
satisfaction.”
Source: http://en.wikipedia.org/wiki/Theory_Z

29. Theory Z
“Theory Z management tends to promote stable
employment, high productivity, and high
employee morale and satisfaction.”
Theory Z example or (lack thereof)
According to newspaperslayoffs.com Associated press
laid off 10 people in February 2013.
More layoffs include: Salt Lake Tribune, Huff Post Live,
etc.
Source: Poynter (http://www.poynter.org/tag/layoffsbuyoutsstaff-cuts/)

30. Theory Z
• Theory Z management is hard to
implement in an uncertain
industry.
Source: http://newspaperlayoffs.com/2013/02/the-associated-press-10/

31. Discussion
• Which management style do you believe
would be more effective and produce a better
work environment?
• What style of management do you think
companies you’ve worked for have exhibited
in the past?

32. Definitions of communication:
“The discipline of communication focuses on
how people use messages to generate meaning
within and across various contexts, cultures,
channels, and media. The discipline promotes
the effective and ethical practice of human
communication.” National Communication
Association
Source: http://www.natcom.orh/discipline

33. Communication:
Jayson Blair, New York Times Reporter
- More than 50 fabricated stories at the New York
Times
- Investigation cited failure of communication
among senior editors, few complaints from
people he had written about in his articles, his
ability to cover his tracks
Source: “Times Reporter Who Resigned Leaves Long Trail of
Deception” http://www.nytimes.com/2003/05/11/us/correcting-the-record-
times-reporter-who-resigned-leaves-long-trail-of-
deception.html?pagewanted=all&src=pm

34. Jayson Blair

35. How are internal structure and
communication related to decisions
A search for efficiency
- Smaller companies: internal communication can be
handled orally.
- This can be in the form of meetings or
phone calls
- Information can be directly relayed to executives
to all a decision to be made
- Not to say written communication isn’t popular,
is very popular in any workplace in 2013
-still oral communication plays larger role

36. How are internal structure and
communication related to decisions
A search for efficiency
- Larger Companies that are more
departmentalized require more written
communication
- Executives no longer rely on unstructured,
direct oral communication
- Instead rely on structured, planned
procedures to monitor many facets of an
organization
- Remember that many media outlets
today are just the piece of a much
larger organizational puzzle

37. Discussion
What are some examples of communication
systems from your life that you think didn’t
work?

38. Flow of Communication
This is the most commonly seen structure for the internal
flow of communication within an organization.

39. Downward communication system
• Communications flow from the highest-level
executives down to a subordinate
• Best for organizations with very defined structure
where titles clearly denote one’s rank within the
system
• Can run into problems when many people sharing
the same rank distribute information
- because so many different people are
delivering the message, it’s bound to result in
a number of different interpretations (think of
a game of “telephone”

40. Upward Communication System
• The exact opposite of downward
communication information comes from the
lower levels an travels upward
• “Channel of upward communications”
– Based on results and reports from lower level
workers
– These findings are delivered to the corporate
level, who make necessary, reactive changes

41. Upward Communication System
Four main objectives of upward communication:
1) to provide feedback to the superiors
2) to give some useful suggestions to
superiors
3) to make the introduction of new
schemes
4) to give an opportunity to the employee
to vent their problems and grievances
(Shukla, 2010)

42. Upward Communication System
Upward communication is nowhere near as
popular as downward
- not authoritative enough, perhaps too
trusting?
- exists at managerial level

43. Lateral Communication System
• This is the communication system that is seen
more often than any other
• Occurs among equivalents
– Communication within an office
– Internal meetings
– Tries to ensure that employees with an equivalent
job are on the same page

44. Grapevine
• Much less forma than three other systems
• More casual, less business-focused “office
talk”
– Still can lead to important communication
– Can occur upward, downward or horizontally
Shukla, Shikha. Professional Communication.
Lucknow, IND: Global Media, 2010. p 14.
http://site.ebrary.com/lib/michstate.Doc?id=10416604&ppg=19

45. Hawthorne Effect
• First test measured if increased lighting in a
factor improved productivity
– Groups were put into a control (with normal
lighting) and a test group (with brighter lighting)
– Researchers confused when productivity of both
groups (control & test) raised equally

46. Hawthorne Effect
• Second test lowers lights with a test group
until objections from the workers that they
could no longer see
– Production was again increased in both groups
until lights got so low it became a hindrance

47. Hawthorne Effect
• Third test had experimenters change the lights
and told the workers the lights were brighter,
even though they were the exact same
– Lights were well-regarded by workers and
productivity improved
– Conditions were no different with new lights

48. Hawthorne Effect
• Results
– Study showed productivity is related to what the
subjects believe more than actual changes in their
environment
– Also demonstrated that worker productivity
increases when subjects believe they are being
watched
• How could this relate to media?
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1464047/

49. Division of Labor
Division of Labor is the process in which
tasks are clearly divided among employees
who have the competence and authority to
carry them out

50. Division of Labor
Advantages
• Efficient use of labor
• Reduced training costs
• Increased standardization
and uniformity of output
• Increased expertise due
to repetition of tasks
Disadvantages
• Routine, repetitive jobs
• Reduced job satisfaction
• Decreased worker
involvement and
commitment
• Increased worker
alienation
• May not be compatible
with computerized
manufacturing
technologies

51. Departmentalization
The way that an organization combines
divided tasks and allocates the tasks to
work groups
• Clarifies how an individuals work fits into
the over goal of the organization
• Departmentalization can be grouped into
two main categories; by process or by
function

52. Departmentalization
Pros:
• Facilitates coordination and efficiency
• Helps to enhance skill specialization
• Improves coordination of tasks and helps to clearly
define the focus of the group
Cons:
• Creates barriers when it comes to reallocating
resources
• Employees may develop more loyalty towards groups
goals than for the goals of the organization
Source: https://www.boundless.com/business/organizational-structure/responsibility-
within-an-organization/departmentalization-pros/

53. Departmentalization
Business Function
• Grouping activities by function performed.
Example: Different departments for
marketing, accounting, engineering, etc.
• Requires methods for groups to communicate
so that all departments are on the same page

54. Departmentalization
Process
• Groups activities based on product, service, or
customer flow
• Allows processes that require different skills to
be lumped together
Example: Several government departments work
together to issue a drivers license

55. Departmentalization
Product or Service
Example: The development, finance, and
marketing employees for one product all
work in the same department
• This system has the advantage of ironing out
problems earlier in the product-development
cycle.
• The disadvantage is it could lead to the
duplication of products within the company
without proper communication

56. Departmentalization
Customer or Market
• This allows employees to tailor their products
or services to the needs of a particular group.
• This may cause employees to overlook
innovations from other departments

57. Departmentalization
Geography
• Frequently used by national and international
companies
• Increases efficiency by not having to wait for
approval from someone in another time zone
• However, lack of communication may lead to
competition between divisions

58. Departmentalization
Divisional
• When one firm develops several different lines
that operate as separate companies
ie: Gap Inc. is the parent company for
Banana Republic, Gap, Old Navy, Piperlime,
Athleta, and Intermix

59. Questions???