This article describes the concept of POSDCORB, developed by Luther Gulick and Lyndall Urwick in a practical way. After reading you will understand the definition and basics of this powerful management tool.
POSDCORB stands for?
It was the American political scientist Luther Gulick and the British management consultant Lyndall Urwick who elaborated Henri Fayol‘s management ideas in their management paper Notes on theory of Organisations, which they published in 1937.
Their result was the acronym POSDCORB, which stands for Planning, Organising, Staffing, Directing, Coordinating, Reporting and Budgeting. In doing so, they built on Fayol’s previous 14 management principles. It should be noted that, in 1937, prevailing thinking still dictated a separation between politics and policy. Gulick and Urwick realised that governments were gaining an increased role in the public sphere at this time. With the POSDCORB concept, they demarcated the various important tasks of supervisors, managers and directors. The concept lists all the tasks that managers have to deal with on a daily basis. As such, POSDCORB is still relevant today.
With the POSDCORB concept, Gulick and Urwick took a number of facets within organisational structure and coordination into account. In their opinion, one is advised not to lose sight of the following:
1. Span of control
This entails the number of employees a manager actually manages. The greater the scope of control, the more the manager has to supervise his/her employees’ work. If the manager also has employees who are unable to work independently, then it becomes quite the job to manage all employees in the right way. Which is why Gulick and Urwick stated that the most effective way is to assign 3 to 6 employees to each manager.
2. Unity of command
Just Fayol, Gulick and Urwick also touched upon the ‘unity of command’. This allows an organisation to function smoothly. The concept is simple: every employee has 1 manager who gives him/her assignments and supervises him/her. In all hierarchical levels of an organisation, this concept should serve as the yardstick. In practice, this means that each employee receives his/her assignments from only 1 manager. Directions from multiple managers can lead to confusion among staff.
3. Distinguish between line and staff functions
The POSDCORB concept recommends a delineation between the functions ‘line’ and ‘staff’. This means that a line manager focuses on his/ her ‘unity of command’ and is the only one who gives orders to his/her employees. Conversely, he/she is solely responsible for the performance of his/her employees. As soon as there is an advisory staff department, with specialist knowledge, it should become clear to employees how the role of these staff managers is arranged. In the case of ‘functional authority’, these staff managers also have the opportunity to get involved in departmental policy and support line managers. This must be clear to employees, otherwise the ‘unity in command’ will be compromised.
What is the POSDCORB concept
The POSDCORB concept consists of tasks, which Henri Fayol developed at the beginning of the 20th century. Below all tasks are briefly explained as Gulick and Urwick interpreted them:
It is the task of managers not only to decide what to do, but also to plan this in the agenda. Planning has to do with foresight. This includes short-term planning (weekly, monthly and quarterly), medium-term planning (annual) and long-term planning (looking ahead with a timeline of 3 years). Planning determines the direction of the organisation. On the other hand, a predetermined timespan means that when time runs out, whatever result one has at the time must suffice. The development of this timeline must be closely monitored.
Managers not only have the task of assigning activities, but also have the task of allocating these tasks to their respective departments and employees. To achieve an end result, the manager needs the necessary resources, including budget, raw materials, personnel and their expertise, technology and machines. He/she will have to organise all sorts of things to achieve the end result. To get started as efficiently as possible, it is important that the employees’ division of labour suits the end goal and end result as well as possible.
This section relates to the personnel policy and all related activities within an organisation. Good and competent personnel is crucial for an organisation to function optimally. It is the task of the manager to first identify the expertise, skills and experiences required for certain positions. Based on this, job profiles are drawn up and personnel can be recruited. The entire recruitment, selection and training procedure falls under this staff policy and ensures that the right type of employee is in the right place.
Direction, of course, lies in the hands of the manager; he/she is the person with final responsibility and is held accountable for this. In practice, this means that the manager maintains control over all functions. In addition, the manager monitors but also motivates his employees. He/ she tells them how best to do their work, encourages them and drives them to take on certain challenges.
With this concept, it is the task of the manager to connect different sections and to achieve cooperation. A good manager has a so-called helicopter view, which gives him/her an overview of what is happening and what still needs to be done. From this perspective, he/ she is able to coordinate tasks and manage his employees. It is his/her task to synchronise different departments and to bring them together with the right end goal in mind.
Without reporting, there is no evidence. A clear report keeps communication open throughout the entire organisation. Managers are the linking pin between the management team and their own employees, who form the constituency. Reporting provides insight into the progress and agreements can also be recorded in this way. Other essential information—such as problems with employees, new processes, performances interviews and sales figures—is also made transparent through reporting. Involved parties can also quickly find archived reports.
Finance is the lifeblood of any organisation. The manager is responsible for the management, expenditure and control of the department’s budget and also has to keep an eye on tax details. In addition to employee wages, it is the task of the manager to also properly monitor other expenditures such as materials and investments. If wasteful spending, overruns, errors or even fraud are discovered, the manager is responsible for taking action.
According to Gulik and Urwick, the design of an organisation is very important. A poorly-organised structure leads to dysfunctional departments and, by extension, organisation. This is why different activities must be grouped together in the right way, so that departments can be created, each with their own specialisms. If tasks overlap, this is indicative of an illogical, wasteful and inefficient design. There must also be clarity about responsibilities and hierarchical layers.
It’s Your Turn
What do you think? What is your experience with POSDCORB? Do you recognize the practical explanation or do you have more additions? What are your success factors for setting up a good organisation management strategy?
Share your experience and knowledge in the comments box below.
- Graham, C. B., & Hays, S. W. (1991). Management Functions and Public Administration POSDCORB Revisited. Public management: The essential readings, 28-38.
- Gulick, L., & Urwick, L. (1937). POSDCORB. Institute of Professional Administration, New York.
- Mintzberg, H. (1972). The myths of MIS. California Management Review, 15(1), 92-97.
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