SpanofControlinMichigansClassifiedService

PreparedforGovernorRickSnyder
JeremyStephens,StatePersonnelDirector
December2011

I.

ExecutiveSummary

In May 2011, several stateemployee unions issued a report, New Solutions for Michigan
(NSM), which offered several proposals to save money while maintaining services. NSM
calculated the states classified workforce as having a stafftomanagement ratio (also
knownasspanofcontrol)of5.87:1.NSMcharacterizedthisratioaslowerthanotherstates
and estimated $75 million in savings could be realized by reducing managers and
increasing the span of control to 6.87:1. In September, Governor Rick Snyder asked State
PersonnelDirectorJeremyStephenstoanalyzetheNSMspanofcontrolproposal.
Span of control has often been studied, but few fixed rules have been found. The
recommendedratioofmanagerstoemployeesvariesbasedonindustry,organizationsize,
andtypeofworkperformed.Employersprovidingprofessionalservicessimilartothestate
of Michigans generally operate under lower ratios. The state workforce also faces legal
mandatesthatnecessarilydecreasestaffingratios.
A review of NSM reveals several discrepancies that deflate the span of control for the
classifiedworkforce.NSMdidnotusethegenerallyacceptedformulaforcalculatingspan
of control, which was used in other comparison states. NSM also included hundreds of
employeesasmanagerswhodonotsuperviseanyemployees.Whenthesecorrectionsare
made,thestatesspanofcontrolisapproximately7.35:1(andhasbeenincreasingoverthe
lastdecade).ArecentPricewaterhouseCooperssurveyindicatesMichiganisinlinewiththe
allindustrymedianspanofcontrolforUSorganizationsof7.6:1.
A review of other states cited in NSM as having higher ratios also reveals different
definitionsthataffectthereportedratios.Michigansspanofcontrolappears,ifanything,to
beonthehigherendofstateswhensimilarmodelsareused.
Calculations forthe $75 million in estimatedcost savings werenotexplained in NSM but
appeartohavebeenbasedonabolishingover1000supervisoryandmanagerialpositions
although a representative of one union has stated that layoffs are not envisioned. Even if

supervisorydutiesweresimplyremovedfrommostmanagers,theestimatedcostsavings
appearinsufficient.
Basedontherequestedanalysis,theredoesnotappeartobeawidespreadorsystemicissue
withthespanofcontrolinMichigansclassifiedworkforce.

II.

TheNewSolutionsforMichigan(NSM)Report

In May 2011, a coalition of stateemployee unions presented a report, New Solutions for
Michigan, which offered several suggestions to save the state money without diminishing
services or lowering standards. One of the proposals included in NSM was to prioritize
frontline service delivery by reducing management. The executive summary for that
proposalofferedthefollowingexplanation:
Michiganhascutitsworkforcedramaticallyinrecentyears,butremainstopheavy.
Information provided by the Civil Service Commission shows the state classified
workforce has a basic stafftomanagement ratio of 5.87 to 1, meaning there are
fewerthansixnonsupervisorystaffforeverymanagerand/orsupervisor.
Otherstateshavebeguntolookmorecloselyatdirectingscarcehumanresourcesto
customerservicesratherthanmultiplelayersofmanagement.TexasandIowa,with
broad bipartisan support, have instituted policies setting ratios at 11:1 and 14:1,
respectively, closer to private sector span of control norms. Iowa is seeking to
increaseitsratioto20:1by2016.
Although the fiscal impact of changing the staffing mix is difficult to measure, a
preliminary analysis for Michigan, which has nearly 1,300 unfilled managerial
positions,suggeststhatimprovingtheratiobyone(from5.87:1to6.87:1)couldsave
the state approximately $75 million annually in compensation costs (not including
benefits).Overthelongterm,movingtowardan11:1targetcouldsavehundredsof
millions of dollars in annual spending. We found little evidence the state is even
awareofthisproblemormakingeffortstofixit.
Recommendation: Michigan should begin a long term effort to
improveitsworkertomanagementratio,beginningwithaonestaff
permanagerincreaseinFY2012.

NSMwasatopicofdiscussionduringcollectivebargainingthisfall.TheOfficeoftheState
Employer reached letters of understanding with unions to form a New Solutions
Committeetoexplorewaystodeliverbetterserviceandpursuebettervalue.
In September, Governor Rick Snyder asked State Personnel Director Jeremy Stephens to
review and analyze existing stafftomanagement ratios for the classified workforce. The
governorrequestedrecommendationsastobestpractices.Thegovernoralsoaskedthestate
personnel director to review NSM and analyze its estimate of potential annual savings of
$75millionincompensationcosts.

Civil service commission staff conducted a detailed study, which included analysis of the
classified workforce span of control, a survey of other states, and discussions with the
authorsoftheNSMreport.Theresultsofthatreviewarecontainedinthisreport.

III. DetermininganOptimumSpanofControl
Expertswhohavestudiedtheratioofmanagementtostaffhavenotfoundasingleoptimal
spanofcontrol.Findingaproperratioisabalancingact.Aspanofcontrolthatistoohigh
means leaders are stretched too thin and cannot mentor and coach their employees. This
cancauseburnoutandhigherturnover.Iftheratioistoolow,anorganizationcanbecome
topheavy,whichcanimpactproductivityandcreateconfusionandindecision.
In2003,BarbaraDavisonoftheSaratogaInstitute(anHRbenchmarkingandservicesarm
ofPricewaterhouseCoopers)discussedtrendsinspansofcontrol:
Historically, management effectiveness experts have recommended that individual
managers should have no more than seven or eight people reporting directly to
them. However, recent studies conducted by the Saratoga Institute, a 25yearold
firmthathasdevelopedtheindustrystandardsformeasurementandbenchmarking,
show that the actual number varies considerablyby industry, company size, and
type of work being done. The Saratoga Institute Workforce Diagnostic Benchmarking
Reports2001foundamedianmanagementratioofoneto16inthehealthcaresector,
butonlyoneinfourininformationservices.Bycompanysize,themedianresultalso
variesconsiderablyonemanagertofouremployeesincompanieswith500orless
employeesandonetonineincompanieswith2,000to5,000employees.

A 2009 newsletter from Saratoga implies that this variability continued to be seen eight
yearslater:
An analysis of PwC Saratoga benchmarks reveals that communications/media,
financial service, and professional service organizations tend to have the lowest
[management span of control] numbers, while hospitals and retailers have the
highestnumbers.

ThePwCSaratoga2011/2012USHumanCapitalEffectivenessReportincludesdatafrommore
than 300 organizations with average company revenues of $5.3 billion and 19,000
employees. The executive summary of the report indicates that the allindustry median
span of control for the US operations of the participating companies has decreased from
8.6:1to7.6:1overthelastsevenyears.
Michigansexecutivebranchagencieshavediverseduties,workforces,andchallengesall
ofwhichwillimpactfindinganappropriatespanofcontrol.The93personDepartmentof
CivilRightswillfacedifferentorganizationalchallengesthanthe13,863personDepartment
of Corrections. Agencies with a greater regulatory focus will have different managerial

needsthanagenciesprovidingmoredirectservicestocitizens.Someagencieshaveoffices
throughoutthestatewhileothersaremorecentrallylocatedinjustafewoffices.
The spanofcontrol ratio can be an effective tool in tracking internal changes in
organizationalstructure.Itcanalsobeusedasabenchmarkalbeitanimperfectmeasure
giventheuniquenessandbreadthofstateagenciesvariousmissionstocomparedifferent
entities. NSM faulted the classified workforce for having too low of a span of control,
especiallywhencomparedtootherstates.ButcloserexaminationoftheNSMdatareveals
significantdifferencesinthestandardsusedindefiningspanofcontrolinotherstatesand
significanterrorsinthecalculationofMichigansspanofcontrol.

IV. DeterminingMichigansSpanofControl
TocalculateMichigansspanofcontrol,NSMreliedondatainbiweeklyworkforcereports
published by the Civil Service Commission. Those reports are not designed for spanof
control analysis. The researchers in Washington D.C. who performed the analysis used in
NSM did not contact Civil Service staff to discuss the data and apparently proceeded
without a full understanding of the states classification and coding systems. Commission
staffonlylearnedoftheanalysisafterthereportwasreleased.
Toarriveatafigureof5.87:1forthestatesspanofcontrol,theauthorsofNSMaddedthe
number of employees in bargaining unit codes Y51 (supervisory) and Y98 (managerial)
duringtheApril16,2011payperiodanddividedthetotalintothenumberofclassifiedstaff
notinthesebargainingunits.
However, the generally accepted formula for calculating a span of control ratio is
[N+(S1)]/S,where:
N=Numberofnonsupervisoryemployees
S=Combinednumberofsupervisorsandmanagers

This is the formula used by Texas and Iowa (the comparison states cited in the NSM
executivesummary)andtheUSDepartmentofCommerce,amongothers.Byinsteadusing
theformula[N/S],theNSMcalculationfailedtoinclude7,000employeesinthestaffratioof
itscalculation.Usingthisformulaandthedatacitedbythereportauthors,Michigansratio
wouldbe6.87:1,buttheciteddatastilloverstatesthenumberofsupervisors.
NSM used bargaining unit codes to determine who to consider as a supervisor in
calculating span of control. Including all employees coded Y98 (managerial) greatly
overstatesthenumberofsupervisorsinstateservice.TheY98bargainingunitisassignedto
managerialpositions,whicharedefinedinChapter9oftheCivilServiceRulesasfollows:
Managerial position means a position in the classified service that is assigned
responsibilityforoneormoreofthefollowing:

(a) Establishingpolicyordirectingtheworkofanagencyoroneofitssubdivisions.
(b) Administeringthepoliciesandprogramsofanagencyoroneofitssubdivisions.
(c) Managing,administering,orcontrollingalocalbranchofficeofanagency.
(d) Representingoradvisingthestateinlegalmatters.
(e) Adjudicating disputes involving classified employees or mediating labor
managementrelationsinthepublicorprivatesector.
(f) Assistinginthepreparationfor,orconductof,primaryorsecondarynegotiations
onbehalfoftheemployer.
(g) Administeringpersonneladministration,laborrelations,orthepreparationand
administrationofabudgetatthecentrallevelofstategovernment,anagency,or
oneofitssubdivisions.

Ascanbeseeninthedefinitionabove,notallemployeescodedasmanagerialinthestates
HR systems supervise others. Examples include Assistant Attorneys General, Labor
Mediators,StateAssistantAdministrators,andothers.Areviewofallemployeescodedas
Y51 (supervisory) and Y98 (managerial) employees found 383 employees who do not
supervise and should not be counted as supervisors for calculating the span of control in
the state classified service. Some employees whose positions were miscoded upon
establishmentwerealsodiscovered.
The following table presents data from the fiscalyearend pay period for the last eleven
years.TheTotalSupervisorscolumncontainsthenumberofemployeesintheSupervisory
andManagerialunitsafterexcludingthenonsupervisorypositionsdescribedabove.

Total
Units
Date
Employees Y51&Y98
9/29/2001
61,933
10,012
9/28/2002
58,200
9,091
9/27/2003
55,038
8,344
9/25/2004
55,095
8,311
9/21/2005
54,506
8,311
9/23/2006
54,346
8,409
9/22/2007
52,926
8,121
9/20/2008
53,508
8,110
9/19/2009
53,715
8,092
9/18/2010
52,307
7,852
9/17/2011
49,974
7,267

Adjustment
(463)
(440)
(424)
(433)
(453)
(455)
(421)
(418)
(419)
(400)
(383)

Total
Supervisors
9,549
8,651
7,920
7,878
7,858
7,954
7,700
7,692
7,673
7,452
6,885

Ratio
6.48
6.72
6.95
6.99
6.93
6.83
6.87
6.96
7.00
7.01
7.26

Onefinaladjustmentshouldbemadetoprovideamoreaccuratespanofcontrolratiofor
the classified service. As of the end of FY 2011, 89 supervisors in frozen supervisory
positionshadnodirectreports.Thesefrozenpositionswereclassifiedassupervisorswhen
created, but due to organizational or other changes have been frozen to mark them for
reclassificationwhennextfilled.
Using this more accurate count of supervisory employees and the appropriate formula
for calculating span of control results in an overall ratio of 7.35:1, a figure 25% higher
thantheratioreportedinNSM.
Thisdataalsoindicatesthatthenumberofstatesupervisorshasdecreasedatagreaterrate
since 2001 than nonsupervisory staff. During a period when total state employment
decreased by 19.3%, the number of supervisors decreased by 27.9%, while the number of
nonsupervisory staff declined by 17.7%. The states span of control increased by 13.4%
duringthistime.ThedatashowsthatstateagenciesarealreadydoingwhatNSMsuggests
hasnotbeenoccurringshiftingresourcestowardnonsupervisorypositions.
One final consideration is special personal service (SPS) employees, whom agencies may
hire when authorized by the Civil Service Commission. These SPS appointments are for
servicesthatare(a)temporary,intermittent,orirregularor(b)sospecializedoruniquethat
theyarenotnormaltoorcannotberecruitedtotheclassifiedservice.Lastfiscalyear,there
were roughly 800 such employees who worked the equivalent of 135 fulltime equivalent
positions.TheseemployeesarealsoexcludedfromtheNSMcalculationsandtheirinclusion
wouldfurtherincreasethestaffingratioforMichigan.

V.

ComparisonswithOtherStates

NSM criticized the states management levels through comparisons to other states with
purportedlyhigherratios.CivilServicestaffsurveyedallotherstatesseekinginformation
on their staffing patterns.After repeated attempts to solicit span of control data, 27 states
responded. Fifteen states either selfreported a spanofcontrol metric (marked by an
asteriskinthetablebelow)orprovideddatasufficientforstafftocalculateone.Michigans
overallspanofcontrolof7.35:1isabovethemedianreportedspanofcontrol(6.48:1)and
nearlyatthemean(7.39:1):
Executive
Employees

Numberof
Supervisors

Spanof
Control

Alabama

31,703

8,816

3.60

Arizona

36,769

4,937

7.45

California

227,000

31,455

7.22

Indiana

29,835

Iowa

19,257

State

6.20*
1,670

11.53

Massachusetts

44,000

3,500

12.57

Montana

12,963

2,250

5.76

Nebraska

13,802

Ohio

55,009

6,832

8.05

Pennsylvania

73,945

15,005

4.93

Texas

147,188

11,309

13.02

Utah

21,715

3,387

6.41

Virginia

63,040

15,276

4.13

Washington

60,310

9,302

6.48

Wisconsin

33,619

3,944

8.52

5.00*

AreviewofthedatareportedbyTexasandIowa(thecomparisonscitedinNSMsexecutive
summary) illustrates the difficulty in comparing a spanofcontrol metric between states.
While the Texas managementtostaff ratio of 13.02:1 appears nearly double Michigans,
data fromthe Texas StateAuditors Office (SAO) raisesquestions as towhether the Texas
andMichigandataaretrulycomparable.
A query of the Texas SAOs online FullTime Equivalent State Employee System indicates
that the Texas Department of Criminal Justice (TDCJ) has a headcount of 40,021 non
supervisory employees managed by a total of 540 supervisors and managersfor a
reportedmanagementtostaffratioof75:1.Acursoryanalysisofanonlinesalarydatabase
from the Texas Tribune, however, shows that, as of August 2011, the TDJC employed
51Directors, 91 Wardens, 100 Assistant Wardens, 120 Majors of Correctional Officers,
288Captains of Correctional Officers, 804 Lieutenants of Correctional Officers,
1,795Sergeants of Correctional Officers, 817 Maintenance Supervisors, 84 Managers,
844FoodServiceSupervisors,678LaundryManagers,304ProgramSupervisors,7Regional
managersand12RegionalSupervisors.TheTDJCswebsitestatesspecificallythatseveralof
these classifications are supervisory, but they are not all included in the SAOs spanof
controlcalculation.
Alloftheseclassificationsandthe5,995incumbentswouldbeconsideredsupervisorsor
managers in Michigans classification system. When recalculated to include just these
classesassupervisors,theTDCJsspanofcontrolwouldbelessthan6.7:1ratherthan75:1.
RevisingthispartofjustoneTexasagencysdatalowersTexassspanofcontrolfrom13.0:1
to8.8:1.AsimilaranalysisofallTexasstateagencydatacouldrevealotherdifferencesinthe
definitionofsupervisorormanager.
The other state mentioned in NSMs executive summary is Iowa, which substantially
reorganized its classification plan in 1992 in response to a mandate from the Iowa
legislature to increase the span of control of supervisory positions in Iowa state
government. To comply with this legislation, executive branch departments chose to

removesupervisorydutiesfrommanymanagementlevelpositionsinIowasPublicService
Executive (PSE) class series. These positions retained their program management duties,
butwereplacedinanewExecutiveOfficer(EO)classseriesthatwasnolongerincludedin
themanagementportionofIowasspanofcontrol.
Currently,Iowahas456EOemployeesand400PSEemployees.WhileemployeesinIowas
EO series no longer perform supervisory duties sufficient for a collective bargaining
exemption under Iowas classification system, they must manage programs or
organizational segments with staff, budgets, and clients served comparable to their PSE
counterparts. And while EO employees may not approve leave, issue performance
evaluations,ordisciplineemployees,theydocoordinateleaverequests,provideinputinto
staffperformanceevaluationsanddisciplinaryproceedings,andparticipateindetermining
employeesgoalsandobjectives.
While these differences in supervisory authority may be one of degree rather than kind,
thereareaspectsoftheIowamodelthatareintriguing.Furtheranalysisanddiscussionis
necessary to determine if an EOtype classification series in Michigan would facilitate
implementation of alternative organizational structures that may be of interest to agency
directorsortheexecutiveoffice.
What Michigan should avoid is a focus on increasing span of control through paper
exercises,suchasmerelychangingpositiondescriptionsandtitles.Numerousstudieshave
indicated this is precisely what happened during the implementation of the National
Performance Review recommendation of a 15:1 ratio infederal agencies citedin theNSM
report.InareviewoftheresultsofthefirstsixyearsoftheClintonadministrationseffortto
reinvent the federal workforce, Paul C. Light, Director of Governmental Studies at the
BrookingsInstitution,observed:
Just because the number of senior executives or middle managers has remained
steady or declined does not mean that the number of layers they occupy has held
constant or diminished. At the middle levels, for example, many agencies have
reduced the number of managers by merely assigning different titles.According to
theGeneralAccountingOffice,fortyonepercentofthedownsizingofsupervisorsat
the NASA Marshall Space Flight Center in Huntsville, Alabama, involved such
reclassification,asdidfortypercentofthecutsattheBureauofLandManagement
and thirtyfive percent at the Federal Aviation Administration. The Social Security
Administration cut nearly 2,800 middlelevel supervisory titles from 19931998, but
created 1,900 new nonsupervisory titles, including 500 team leaders and 1,350
managementsupportspecialists.

IfaspanofcontrolistobesuggestedforMichiganbasedonreferencingotherstatesratios,
fullconsiderationofthedifferentcalculationmethodsusedinotherstatesmustoccur.

VI. VariationsbetweenStateAgencies
As mentioned earlier, different state agencies have different missions, workforces, and
requirements that lead to different spans of control. The spans of control for Michigans
executivebranchagenciesrangefrom5.16:1to10.81:1:
NSM
CSC
%
Department/Agency
Report Calculation Difference
Agriculture
5.06
6.93
37.0%
AttorneyGeneral
0.63
5.16
719.0% [1]
CivilRights
4.00
5.81
45.3%
CivilServiceCommission
5.56
7.22
29.9%
CommunityHealth
4.88
5.95
21.9%
Corrections
6.25
7.50
20.0%
Education
5.32
6.57
23.5%
EnvironmentalQuality
6.48
8.32
28.4% [2]
HumanServices
7.18
7.36
2.5%
LaborandRegulatoryAffairs
3.73
7.82
109.7% [3]
Technology,Management&Budget
5.70
7.28
27.7%
MilitaryandVeteransAffairs
6.49
7.88
21.4%
NaturalResources
6.48
10.81
66.8% [2]
State
3.73
5.73
53.6%
StatePolice
6.86
7.98
16.3%
StrategicFund
3.81
10.17
166.9% [4]
Transportation
5.60
7.18
28.2%
Treasury
5.12
6.10
19.1%

1.

Discrepancy largely due to the inclusion of nonsupervisory attorneys in the NSM count of
supervisorystaffintheDepartmentofAttorneyGeneral.

2.

DNRandDEQwereseparatedaftertheNSManalysis.

3.

Part of discrepancy due to calculation error in NSM report. Using NSMs formula, original
reportshouldhavelistedLARAs(thenDELEGs)spanofcontrolas6.45.

4.

WorkforceDevelopmentAgencymovedtoStrategicFundafterNMEsanalysis.

Agencies were asked to explain those areas within their organizations with relatively
narrow spans of control. Several factors were raised that should be considered when
reviewingspanofcontrolinthestateclassifiedservice:
StatutoryorOtherLegalRequirements:Staffingratiosmaybestatutorilymandated.The
MichiganVehicleCode,forexample,requiresatleastoneSecretaryofStateofficeineach
countyandineachcityof10,000ormorethatisnotwithinfivemilesofacountylocation.

Branch supervisors serve as working supervisors and are responsible for the efficient
operationofbranchoffices.Manybranchesinsmallercommunitieshavenarrowspansof
controloftenoneortwoemployeesandasupervisor.Ofthe131SecretaryofStatebranch
offices,77haveastafftomanagementratioof5:1orlower.
Litigationmayalsoresultinmandatedstaffingratios.TheDepartmentofHumanServices
is operating under a modified settlement agreement that mandates that each Foster Care,
Adoption, CPS, Licensing, and POS Monitoring Supervisor will be responsible for the
supervisionofnomorethanfivecaseworkers.
Contractual Employees: Managers and supervisors in state service also may oversee
contractualemployees,whoarenotreflectedinstaffingratios.Forexample,forsupervisors
and managers within the Public HealthAdministration in the Department of Community
Healthwhooverseecontractualstaff,thespanofcontrolmorethandoublesfrom5.9:1to
12.0:1 if the 328 contractual employees from the Michigan Public Health Institute and
SoutheastMichiganHealthAssociationareincluded.Similarly,inDCHsMedicalServices
Administration, the span of control increases from 7.5:1 to 11.2:1 if contractual staff is
considered. Similar situations exist at other agencies, including the Departments of
Education,Transportation,andState.
Unfilled Vacancies: DTMB reported that they are currently working to fill positions
vacated during the most recent incentivized retirement. Following this type of largescale
turnover, agencies typically replace managerial staff first. This allows managers to play a
roleintheselectionanddevelopmentoftheirnewteammembers.Giventhetimingofthe
NSManalysis(April2011),someagencyspecificspansofcontrolcouldhavebeenimpacted
bythisactivity.
Additionalfactorsthatimpactspanofcontrolmentionedbystateagenciesandsupported
byPwCssurveysinclude:thesizeoftheorganization;theproximityofemployeestoeach
otherandtotheirmanager;thetypeofserviceproduced;thecomplexityandsensitivityof
thework;andtheconsequencesoferror.

VII. EstimatedSavingsfromaHigherSpanofControl
NSM suggests that a $75million savings in wage compensation could be generated by a
onepoint increase in the states ratio of staff to supervisors. The NSM report does not
specifyhowthisfigurewasgenerated.Whencontacted,theresearcherswhoreachedthat
figure indicated it was based on simply eliminating the number of supervisory and
managerial positions necessary to increase the ratio by 1 point. The NSM researchers
counted all 6,970 Y51 and Y98 unitcode employees as managers to calculate a span of
controlof5.87:1.TheNSMresearchersdeterminedthatnumbercouldbeincreasedto6.87:1
by simply eliminating 14.56% of supervisory positions. The $75 million figure represents

10

14.56% of the gross pay for those unit codes. Achieving these savings would require the
abolishmentofapproximately1,000supervisoryandmanagerialpositions.
It is difficult to reconcile the NSMs stated goal to save these funds without diminishing
services or lowering standards, while eliminating 1,000 managers and supervisors. In
addition to often providing direct services to citizens, supervisors and managers in state
serviceareresponsibleforplanningandorganizingwork,identifyingandmitigatingrisks
andliabilitytothestate,ensuringquality,takingcorrectiveactionwhenneeded,andahost
ofotheractivities.Theresponsibilitiesperformedbythesemanagersandsupervisorswould
notbediminishedorabolishedalongwiththeirjobs.
An article from the October 6, 2011, issue of MIRS Capitol Capsule discussing NSM
suggeststhat at least one coalition union does notforesee layoffs as themeansto achieve
theprojectedsavings:
Weareagainnotaskingforanybodytolosetheirjobsbutwhatweresayingiswe
need to stand by the people who do the heavy lifting, said UAW6000 Legislative
LiaisonRayHOLMAN,whosaidtheunionsarestandingbythereport.
Hesaidthatonepossibilityisthatpeoplecouldbeunclassifiedasmanagersandjoin
therankandfile.
A lot of those positions, they could come back into the collective bargaining unit.
They may lose a title but they may not lose a job. That might be a better pill for
somebodytoswallow,saidHolman.

This statement is incongruous with the assumptions of the NSM calculation. To reduce
thosepaycostsby14.56wouldrequirethecompleteeliminationofthepositions.Thelarge
scalemovementofsupervisorypositionsintolowerpaidnonsupervisorypositionswould
notaccomplishsuchsavings.
The states span of control could be increased by 1 point by returning 835 supervisors to
nonsupervisorypositions.Assuminga$5,000to$10,000paydifferentialbetweenfirstline
supervisorsandthefullfunctioningorleadworkeremployeestheysupervise,suchaction
would result in $4.2 to $8.5 million in wage savings. At these wage differentials, at least
7,500 employees would need to be moved into staff positions to reach $75 million in
savings. This is greater than the total number of supervisors and managers currently
workingforthestate.
In addition, in the Business and Administrative and Scientific and Engineering units, a
significantproportionofmanagerswouldqualifyforspecialistpositionsintheirclassseries
at roughly the same rate of pay earned as managers, thereby further decreasing any
savings. Furthermore, in all units, many staff employees are eligible for overtime while
supervisorsandmanagersarenot.Additionalovertimepaidwoulddiminishsavings.

11

Sincesupervisoryemployeesgenerallymakemorethanotherstaff,ahigherspanofcontrol
wouldachievesomemarginalcostsavings,butanysuchsavingswouldappeartobemuch
smallerthanthe$75millioncitedinNSM.

VIII.BestPracticesandRecommendations
There is no single rule of thumb for defining the appropriate span of control for state
agencies. A comparison to other states reveals that Michigans span of control appears
comparable to other states reported figures. Further analysis also reveals that Michigans
ratios might appear even more efficient after further investigation of differing definitions
used in other states to calculate the ratios. Simple managerial ratios may not be the most
appropriate measure of managerial responsibility and efficiency. Given the difficulties
inherent in calculating and comparing span of control within and between organizations,
continued focus on agencies missions and performance seems appropriate. Quality
improvementandleaninitiativesadvocatedbybothGovernorSnyderandanotherpartof
NSMcanaddressefficientstaffinginindividualareasandachieveandmeasureefficiencies
moreeffectivelythanmererelianceonaspanofcontrolratio.
Recommendations:
In conclusion, while this report does not recommend the establishment of executively
directedminimumspansofcontrolforstateagencies,wedosuggestdepartmentscontinue
the ongoing review of their organization structures to ensure they strike the appropriate
balancebetweendesiredorganizationalflexibilityandnecessaryinternalcontrols.TheCivil
Service Commission could take the following steps to facilitate the executives
implementationofanydesiredorganizationalchanges:
1.

Review the classification system to ensure it supports more flexible organizational

structures. This will include a review of Iowas experience with its Executive Officer
series as a means to better differentiate managerial positions with minimal
supervisorydutiesandmorefocusonprogrammanagement.

2.

WithinputfromtheOfficeoftheStateEmployerandotherinterestedparties,review
the system for reviewing and classifying specialist positions. Anecdotal evidence
suggests that agencies will sometimes establish and fill a managerial position rather
than a specialist position due to a perceived or an actual difficulty in establishing
higherlevelspecialistpositions.Theexperienceofotherpublicsectoremployersmay
alsoprovideguidance.

3.

To more accurately track and report the states span of control, audit the unitcode
assignmentforallsupervisoryandmanagerialpositionsanddevelopandimplement
anautomatedprocesstomonitorunitcodeassignment.

12

Sources
BarbaraDavison.Managementspanofcontrol:howwideistoowide?JournalofBusiness
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