Organization Size and Efficiency: The Choice Between Reading and Writing

H. Theil
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H. Theil: Econometric Institute, Rotterdam, Netherlands

Management Science, 1962, vol. 9, issue 1, 9-15

Abstract: In a recent article in Management Science, F. P. Adler [Adler, F. P. 1960. Relationships between organization size and efficiency. Management Sci. 7 (1, October) 80-84.] developed a simple model to analyze the implications of a growing research organization and the resulting increase of internal mail on the creative productivity of the individual worker of that organization. His approach involves the assumption of a constant fraction of the total written output being read by each individual, and this leads to the interesting conclusion that this total output approaches a finite upper limit when the size of the organization grows indefinitely. In plain terms, this means that when the organization is big enough, everyone devotes his time essentially to reading reports written by others. In this paper an attempt is made to formulate a simple mathematical model which concentrates on the individual's creative output (Section 2); Section 3 contains some brief hints on how to apply it in the framework of an organization.

Date: 1962
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