1.4.3 Organisational Design

Question 1

organisational structure

Answer 1

shows how employees and management are organised in a business

Question 2

what does an organisational structure determine?

Answer 2

-authority
-responsibility
-job roles and titles
-accountability
-communication flow routes

Question 3

what does an organisation chart show?

Answer 3

management hierarchy in business- span of control, line of management, chain of command

Question 4

what do the levels of hierarchy refer to?

Answer 4

the number of layers within an organisation

Question 5

span of control

Answer 5

the number of subordinates for whom a manager is directly responsible

Question 6

what does span of control depend on?

Answer 6

-experience and personality of manager
-nature of the business
-skills and attitudes of the employees
-tradition and culture of the organisation

Question 7

narrow span of control

Answer 7

allows for closer supervision of employees, more hierarchy layers may be needed, more effective communication

Question 8

wide span of control

Answer 8

subordinates have more independence, more appropriate if labour costs are too high as number of managers is reduced
-could increase creativity and employees may come up with more innovative ideas

Question 9

chain of command

Answer 9

the lines of authority within a business

Question 10

flat structure

Answer 10

less layers= less staff= lower costs

Question 11

advantages of flat structure

Answer 11

-collaboration and open communication
-faster decision-making
-creativity and innovation
-increasing efficiency and motivation

Question 12

disadvantages of a flat structure

Answer 12

-role ambiguity and a lack of a clear hierarchy
-no clear promotions or career advancements
-employees could take on multiple roles
-reduces efficiency and motivation

Question 13

tall structure

Answer 13

more layers= more staff= higher costs

Question 14

advantages of tall structure

Answer 14

-clear hierarchy of authority
-promotes specialisation and expertise in departments
-opportunities for career advancements and promotions
-increases efficiency and motivation

Question 15

disadvantages of tall structure

Answer 15

-communication barriers
-slow decision-making
-leads to excessive levels of management
-reduces efficiency and motivation

Question 16

delayering

Answer 16

the process of removing layers in the hierarchy
(cutting costs and increasing efficiency)

Question 17

why change organisational structure?

Answer 17

-more formal structure may be required for a growing business
-reduces costs and complexity
-employee motivation may need boosting
-customer service needs improving

Question 18

benefits of delayering

Answer 18

-improves communication and speeds up decision making
-reduces costs
-business is more agile and responsive to changes in the external environment

Question 19

drawbacks of delayering

Answer 19

-increases responsibilities of managers
-decreases ability to make informed decisions

Question 20

matrix structure

Answer 20

a structure where individuals work across teams and projects, as well as within their own department or function

Question 21

advantages of a matrix structure

Answer 21

-flexibility and shared knowledge between departments
-promotes collaboration by bringing together employees from different departments

Question 22

disadvantages of a matrix structure

Answer 22

-confusion regarding your role and responsibilities
-hard to know who your superior is/ who to report to

Question 23

what does authority determine?

Answer 23

who makes decisions in an organisation

Question 24

centralised decision-making

Answer 24

decisions made at the top of the hierarchy- senior management

Question 25

advantages of centralised decision-making

Answer 25

-easier to implement prat ices and decisions for the whole business
-easier to coordinate and control, no departments become too independent

Question 26

disadvantages of centralised decision-making

Answer 26

-decision making is not made by someone who specialises in the area
-employees may feel disconnected form decisions or the process

Question 27

decentralised decision-making

Answer 27

decisions are spread out to include more junior managers in the hierarchy

Question 28

advantages of decentralised decision-making

Answer 28

-decisions can be made closer to the customers (departments are more aware of the needs for their customers)
-improves motivation

Question 29

disadvantages of decentralised decision-making

Answer 29

-may not be ‘strategic’ decisions
-harder to achieve tight financial control over the whole business
-harder to ensure consistent practices and policies at different locations of that business

Question 30

delegation

Answer 30

the assignment to others of the authority for a particular function, task or decision

Question 31

what does job empowerment involve?

Answer 31

gives employees the power to do their job
-motivation and customer service

-front-line staff can have authority to make decisions
-encouraging employee feedback
-showing more trust and belief in employees