143 Analysis of Functional Relationships

143.1 Basic Factors

The identification of work and skill requirements provides the basis for determining staffing needs. The next step is to analyze the organizational structures to ensure that functional alignments and reporting relationships are appropriate to the unit’s mission. The criteria used to make such a determination are identified in subchapter 130. Critically important criteria, as outlined in previous sections, are repeated below:

  1. Review functional statements and job descriptions to eliminate duplication of responsibility between subordinate units of the organization, as discussed in 133. Where such duplication is found, functional responsibility is assigned to the subordinate unit having dominant interests in the activity under review.
  2. Group functional activities to ensure homogeneity of work as discussed in 135.
  3. Establish a span of control consistent with the guidelines discussed in 136.
  4. Establish a hierarchy of responsibility in vertical reporting relationships consistent with the guidelines discussed in 134.1.
  5. Align contingent work relationships so they are consistent with the concepts discussed in 134.2.

143.2 Reporting Relationships

143.21 Administrative

An administrative reporting relationship establishes a clear line of authority between positions or units in the organizational hierarchy. The actions of the subordinate are subject to the direction and approval of the next higher level of management, irrespective of the autonomy the latter may choose to grant to, or withhold from, subordinate levels. Subordinate positions never report administratively to more than one higher level supervisor.

143.22 Functional

A functional reporting relationship establishes a connection between positions or organizational units at different management levels based on the specialized nature of the function for which a mutual responsibility is shared. In this type of situation — often referred to as an indirect reporting relationship — the higher level position or unit provides functional guidance and support to positions or units lower in the organizational structure.

For example, Human Resources at Headquarters has functional responsibility for human resources activities in the areas. However, these activities report administratively and directly to the vice president, Area Operations. There is no formal line of authority in a strictly functional relationship.

143.23 Management of Reporting Relationships

The administrative head of an organization integrates all unit activities through the exercise of organizational authority. Detailed functional expertise is usually located immediately below this level of management, where administrative authority and functional direction are joined.

Sometimes it is necessary to separate administrative and functional reporting relationships. A separate functional reporting relationship might be justified when:

  1. The knowledge essential to effective performance is so specialized that the function can only be placed in the higher levels of the organization (e.g., the Postal Service medical program).
  2. The consequences of an incorrect decision are so great as to require continuing consultation with a higher organizational level having policy responsibility for the functional area in question (e.g., international mail).
  3. The sensitivity of the function requires total uniformity of execution throughout the entire organization (e.g., labor relations or purchasing).

Organizational relationships are analyzed in terms of the adequacy of functional direction. Where it is appropriate, functional reporting relationships can be formally established so that sanction channels of communication are not reflected in the administrative structure.

143.3 Line and Staff Relationships

While line relationships are based on the exercise of organizational authority, staff relationships are founded on the exercise of organizational influence and the authority of knowledge. While line managers are empowered to make operating decisions, staff personnel act in an advisory role. Line managers report administratively to the next higher level of management. Staff managers report administratively to line or staff management and often functionally to another level of management outside and, sometimes, above the unit structure.

Staff functions are analyzed based on the following criteria:

  1. Appropriate placement within the structure. If the reporting point is too low in the structure, the exercise of influence is impaired.
  2. Extent of need. Functional expertise may be readily accessible to line management outside the immediate structure, obviating the need for redundant internal staff.

143.4 Responsibility and Authority

A principle rule in organizational design requires authority to be commensurate with responsibility. Managers cannot be held accountable for results over which they have limited or no control. Analyze reporting relationships to uncover any organizational defects such as:

  1. Placement of authority at one or more levels above the designated level of responsibility.
  2. Placement of essential organizational resources outside the managerial control of the manager who needs them most and who should be accountable for their use.
  3. Granting overlapping authority to two or more positions or units that could lead to jurisdictional conflicts.