Rethinking Organizational Structure to Increase Efficiency

Thursday, February 11, 2016

Many governments struggle with striking the right balance between specialization and flexibility. There is no perfect answer to this challenge, but focusing on function is a promising place to start. Outdated organizational structures designed to accommodate older technology keep many organizations from building teams, departments, and organizational units in ways that maximize efficiency.

The City of Dayton, Ohio addressed this challenge by developing budget teams around the city’s primary finance-related functions. By focusing on function rather than title or hierarchical structure, the city was able to gain efficiency and concentrate expertise by combining similar tasks. As a result, Dayton’s finance department is made up of two divisions: Tax and Accounting Administration, and Revenue Administration. Tax and Accounting Administration comprises Payroll and Disbursements, Financial Analysis, Tax Compliance, and Treasury, while Revenue Administration comprises Collections, Billing and Meter Reading, and the Utility Contact Center.

In separating Revenue Administration from more traditional finance functions, the city distinguished business areas with a customer service component from core finance roles. Rethinking the groupings within each division also allowed the city to better focus its resources. Because municipalities vary in budget size and demography, there are many potential organizational structures, depending on organizational culture, legal and political environment, and any number of other factors. What does seem to be universal, however, is the importance of giving real thought to the structure of the organization, on both the macro- and micro-level, to position all employees for maximum efficiency.

For more information about Dayton’s organizational structure, click here.

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