Organisational Structures

Question 1

What is the span of control?

Answer 1

The number of employees managed directly by another employee. Based on principle - managed can only effectively manage limited number of employees
- wider means fewer layer of management

Question 2

What is the chain of command?

Answer 2

The formal line of authority within a business along which communication passes. Flows down from top to lower level employees. It defines who reports to whom. Helps maintain accountability

Question 3

What is delayering?

Answer 3

The removal of one or more levels of hierarchy from a business’s organizational structure. 2 main reasons - reduce costs by having fewer employees and to improve communication within the organisation

Question 4

What is delegation?

Answer 4

Passing down authority to more junior employees.

Question 5

What is a flat organisational structure?

Answer 5

A structure with a few levels of hierarchy, comparatively wide span of control and a short chain of command, decentralized.
Employees - autonomy at some level

Question 6

What is a tall organisational structure?

Answer 6

A structure with many levels of hierarchy, relatively narrow spans of control and a lengthy chain of command, more centralized. Common in larger organizations

Question 7

What does the organisational structure to

Answer 7

Outlines the reporting relationships, roles and responsibilities of employees. Consider - structure affects the management, communications and operations.

Question 8

What is a centralized organisational structure?

Answer 8

Authorize for decision making rests with the senior management- center of a business

Question 9

What is decentralized structure

Answer 9

When authority for decision making is delegated further down towards hierarchy towards functional or middle managers.

Question 10

Advantages of a centralized structure

Answer 10

• effective coordination and control of business operations from the centre.
• fast and decisive decision making can increase competitiveness consistency across the whole organization

Question 11

Disadvantages of centralized structure

Answer 11

• middle managers lack of autonomy can impact their motivation
• highly bureaucratic - rules and processes - slowing communication of decision making
• ignores insights of lower level staff who are likely to be closer to customers

Question 12

Decentralized advantages

Answer 12

• better able to respond to local market conditions and meet customer needs
• staff able to contribute to decision making - may be more fulfilled and loyal
• prepares junior management for career development

Question 13

Decentralized disadvantages

Answer 13

• diseconomies of scale - such as the duplication of staff roles may emerge
• may be difficult to tightly control budgets
• during times of crisis leadership may not be clear.

Question 14

Directors

Answer 14

Larger business often have a board of directors - strategic business decisions - new cooperate policies, growth objectives.

Question 15

Managers

Answer 15

Have many responsibilities to help operate effectively on day to day

Question 17

Tall structure advantages

Answer 17

Provides a clear structure of authority and defined roles and responsibility

Promote specialization, and expertise within each department or function

Offers opportunities for career advancement, and promotion within the organization

All increases motivation

Question 18

Flat organizational structure advantages

Answer 18

Promote a culture of collaboration and open communication

Decision-making can be more efficient as communication is quick quicker

Encourages creativity, and innovation as employees have more autonomy and flexibility

All improves efficiency

Question 19

Disadvantages of a tall organizational structure

Answer 19

Can create communication barriers between upper and lower levels of hierarchy

Decision-making can be slow as information plus pass through multiple players of management

This can lead to bureaucracy and excessive levels of management

Question 20

Disadvantages of flat structure

Answer 20

Employee and management rules may not be clearly defined, causing confusion

Employees may need to take on multiple responsibilities leading to burnout and stress

Can lead to role ambiguity and lack of clear hierarchy.

May not provide clear advancement of promotion

Question 21

Real life example of a business with flat organisational structure

Answer 21

Valve corporation - video game developer and published behind life, portal and steam platform.
Why? High speed innovation - without layers of middle management requiring reports or approval - valve pivots instantly. Build immediately
Increased autonomy and motivation - employees not told what to do choose what to do, increasing passion

Question 22

Real life example of tall organisational structure?

Answer 22

Tesco PLC
Multiple layers allow for narrow spans of control - managers directly supervise fewer staff - high quality control and strict compliant - operational procedures
Specialization of roles - duties highly defined - employees become expert in specific tasks
Structure - clear chain of command esp for massive retailers - top management