A chain of command in your business can provide an orderly system for supervising employees at various levels. It can also create many communication problems in your business. As each level of the hierarchy protects its own territory and asks for input into communications, messages can become garbled and never arrive at their destinations. Anticipating the problems with communications in the chain of command can help you watch for bottlenecks and errors.
Subordinates may be reluctant to report bad news to their superiors. For example, a sales team that misses a sales target may be shy about telling the sales manager, who may in turn wish to avoid communication with a financial officer. This built-in reluctance in a chain of command can prevent notification of problems from reaching the top tiers. In other words, the primary decision-makers may not have all the information they need to make the decision, because employees throughout the chain of command are protecting their jobs.
Top-tier executives may establish what they think is clear policy only to find that employees farther down the chain either don't understand the policy or that it never reaches them. For example, if the company establishes a policy that customers will have 60 days to pay invoices, and customer service personnel don't get the memo, they may continue offering 90-day payment periods.
A company may need all departments to weigh in on a decision such as whether to open a new branch. This requires meetings between department heads and their staff, and that means scheduling many individuals who may have scheduling conflicts and other priorities. This can bog down the decision-making process as each department delays communication about its input on the problem. A company may experience missed opportunities as a result.
The top of the chain of command may intend for an initiative to create a certain result, but the way that initiative is carried out may produce surprises. For example, if a company decides to offer discounts on merchandise reaching its expiration date, salespeople may communicate the idea to customers that the operation is becoming a discount store. Customers could delay buying full-price items in anticipation of an upcoming discount. The original intention of moving dated inventory could result in lost revenues on all future inventory.
