1.4.3 Organisational Design Flashcards
Define Organisational design
Organsiational design refers to a diagram or chart which shows the lines of authority and layers in the hierarchy of the business.
What is hierarchy?
A hierarchy system in a business where employees are ranked due to their status and authority.
What is the ‘chain of command’
The chain of command in a business is the flow of information through the organisation.
What is a span of control?
Give an example.
The number of subordinates someone can delegate to, e.g. an employee who is a Head of Department in a school may have 6 teachers working for them. Their span of control is 6
What is Decentralisation?
Where a business divides up the organisation of it’s business into areas, e.g. north, south, east, west. The business will have seperate budgets for each area.
What is Centralisation?
Where a business has it’s organisation of management and administration at one central head office. The business has one central shared budget.
What are the 6 things an organisational chart show?
- ) Name of departments
- ) Job roles
- ) Responsibilities and accountability
- ) Lines of authority
- ) Lines of communication flow in the organisation
- ) Chains of command in the organisation
What are the 3 main types of organisational structure?
1.) Tall Structure
2.) Flat Structure
3.) Matrix structure
What are the advantages of a tall hierarch structure?
-Supervisors normally have a small span of control so they can get to know their subordinates really well.
-Knowing subordinates means they can delegate the right tasks + make sure their team is well trained.
What are the disadvantages of a tall hierarchal structure?
-Lots of layers + a long chain of command = inflexible.
-Communications within the org. are slow.
-Expensive as there are more managers + supervisors.
What are the advantages of a flat structure?
-Fewer layers of hierarchy between the bottom + the top of the org. = fast communication.
-Lots of delegation means that staff are given greater responsibility = more opportunities to use their abilities.
What are the disadvantages of a flat structure?
-Staff can be overworked due to less supervision = stress + demotivation.
-Can create a power struggle of the manager is rarely around.
-Wide span of control means managers have too many staff to manage + May loose touch with them. What
What are the advantages of a matrix structure?
-Matrix structure is ideal for a business that works on a project-by-project basis
-Very flexible structure means that staff from different departments can jump in + out of roles.
-Perfect to exploit the specific skills of staff.
What are the disadvantages of a matrix structure?
-Possible co-ordination problems between departments.
-Conflict of interests across projects.
-Staff stretched across different projects, not spending enough time in their own departments.
