2.1 Internal Business - Organizational Structure Flashcards
What is organisational structure?
Shows the levels of management and responsibility within a company.
Who is responsible for what, who is the boss of who.
What is Hierarchy?
Levels of authority - e.g. Finance manager reports to CFO
What is the “span of control”?
How many people report each manager
e.g. The Finance manager might have 3 different people reporting to him, so the span of control is 3
What is delegation?
Giving tasks or authority to those lower in the chain
e.g. the CEO might get the CFO to make the financial decisions
What is the difference between centralised and decentralised decision making/structure?
Centralised - when one or two people make all of the decisions
Decentralised - when multiple people in the business are involved in making decisions, empowering staff.
What is the difference between tall and flat organisational structures?
Tall - multiple layers of management, chain of command i.e. everyone has someone to report to in a chain. More accountability, and each person only manages a few people. Span of control is small
Flat - few layers of management. Span of control for each manager is big.
What are some examples of tall and flat organisational structures?
ANZ - tall - chain of command
Apple - flat
What are advantages and disadvantages of tall organisational structures?
Advantages: clear division of responsibility. Each manager has to manage a few employees meaning they can coach them more closely.
Disadvantage: communication is slower. Takes time to go down the chain.
What are advantages and disadvantages of flat organisational structures?
Advantage: Better communication. Employees feel more a part of influencing the company.
Disadvantage: Confusion over responsibility/roles, and each manager has to manage more employees, meaning they can’t coach them as closely.
