Organisational structure

Question 1

Management structure

Answer 1

• How the company management is organised borh horizontally and vertically
• horizontally - function or operation
• vertically - hierarchy of responsibility

Question 2

Factors affecting organisational structure

Answer 2

• company size
• ownership size
• business objectives
• external factors
• technology

Question 3

Span of control

Answer 3

• Tall structures
  
  • line managers have small span of control and therefore focus on limited activities
• Flat structures
  
  • fewer levels of management, therefore, greater span of control
  • provides a leaner and more flexible organisation

Question 4

Types of organisational structure

Answer 4

• entrepreneurial
• functional
• product derived
• system approach

Question 5

Entrepreneurial(benefits and limitations)

Answer 5

• Benefits
  
  • direct control, therefore, quick decision making
  • reduced management cost
• Limitations
  
  • company size
  • relies on effectiveness of one person

Question 6

Features of a functional structure

Answer 6

• specialisation within departments
• built on forml procedures
• distinct delegation of authority within lines of hierarchy

Question 7

Functional(benefits and limitation)

Answer 7

• Benefits
  
  • task focus makes it highly suitable for single or product related companies
• Limitations
  
  • inflexible structures which tends to be slow to react to new demands/changes

Question 8

Product derived(benefits and limitations)

Answer 8

• Benefits
  
  • allows product/market specialisation
  • allows a degree of autonomy and identity within the organisation
  • more rapid decision making possible
  • more flexible
    
    • allows for expansion of product/services
  • easier overall performance measurement possible
• Limitations
  
  • possible conflicts between divisions with regard to allocation of fixed costs,budget and financing
  • can produce duplication of activity within the organisation therefore higher costs

Question 9

Matrix features

Answer 9

• skeletal structure from which specialist teams can be formed to perform set tasks
• teams made up of personnel from different departments
• team personnel may have more than one manager
• suited to organisations that continuously run large projects

Question 10

Matrix(benefits and limitations)

Answer 10

• Benefits
  
  • better coordination achieved via specialist teams
  • allows personnel the opportunity to develop their potential
  • more flexible organisation able to cope with a dynamic business market
• Limitations
  
  • lines of accountability can become blurred
  • having more than one manager at a time may place heavy demands on the individual and may lead to conflicts of interest