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The transaction cost approach can be utilise as a method of which an institution can get by its employees behaviour and performance. Shirking and Free riding were identified break levels of productivity in employees and thus governing bodys would attempt to reduce the levels of con and free riding by implementing methods of improving task visibility where employees ar acknowledged discretely for good performance from the tasks they undertake and are thus satisfied for performing tasks well. Jones discovered that the way that an organization can outgrowth task visibility and satisfaction in employees is through a reduction in the number of hierarchic levels in an organization, hence a flatter organizational structure. This termination that Jones discovered supported the hypothesis that Employee performance and satisfaction testament be positively related to the level of vertical peculiarity except at high levels[1]. The working logic rear this hypothesis is th at as the hierarchical level of an organization increases one-time(prenominal) a certain optimum point task visibility put start reducing.

However from a cost prospect The advantages of using vertical differentiation as a outline of control condition is subject to diminished returns [1], as productivity ordain increase with a Flatter and broader management structure be will also increase due to the need of particular managerial supervision and thus these costs may outmatch the benefits. References [1] - tax Visibility, Free Riding, and Shirking: Explaining the Effect of Structure and engineering on Employee Beh avior Gareth R. Jones The Academy of Manag! ement Review Vol. 9, No. 4 (Oct., 1984), pp. 684-695 Published by: Academy of Management Stable uniform resource locator: hypertext transfer protocol://www.jstor.org/stable/258490If you want to get a full essay, high society it on our website: OrderCustomPaper.com

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