23 Organisation structure and employees

Question 1

Define formal organisation

Answer 1

Internal structure of a business shown by an organisation chart

Question 2

Define directors

Answer 2

Those who are appointed by owners to run the business

Question 3

Define managers

Answer 3

Those who are responsible for planning, controlling, organising within their department and to acieve the objectives of the owners

Question 4

Define supervisors

Answer 4

Those who monitor the work in their particular area

Question 5

Define operatives

Answer 5

Skilled workers involved in the production process

Question 6

Define general staff

Answer 6

Staff that do not have any specific skills

Question 7

Define professional staff

Answer 7

Highly skilled and trained staff

Question 8

Define chain of command

Answer 8

Route through which orders are passed down the hierarchy

Question 9

Define subordinates

Answer 9

People who are under control of a more senior worker

Question 10

Define span of control

Answer 10

Number of people a person is directly responsible for in a business

Question 11

Define flat structure

Answer 11

Organisation structure with fewer layers in the hierarchy

Question 12

Define tall structure

Answer 12

Organisation structure with more layers in the hierarchy

Question 13

What are the advantages of a flat structure

Answer 13

1. Communication is better because the chain of command is short
2. Management costs are lower because there are fewer layers of management
3. Control may be more firendly and less formal because their is direct contact between layers

Question 14

What are the disadvantages of a flat structure

Answer 14

1. Less motivation because there is less chance of promotion

2. The span of control is wide which may be more frustrating for senior workers

Question 15

What are the advantages of a tall structure

Answer 15

1. More motivation because there is a clear route for promotion

Question 16

What are the disadvantages of a tall structure

Answer 16

1. Communication can be poor because there is a long chain of command
2. Management costs will be higher
3. Control tends to be more formal and less friendly because of all the layers

Question 17

Define delegation

Answer 17

Authority to pass down work from superior to subordinate

Question 18

What is the advantage and disadvantage of delegation?

Answer 18

Motivates workers because they feel as they are being ‘trusted’ to complete the task

May be dissatisfied because they may think that ‘extra’ work is given without any reward

Question 19

Define centralised

Answer 19

Type of organisation system where most decisions are made at the top of the organisation and then passed down the chain of command

Question 20

Define decentralised

Answer 20

Type of organisation system where decision making is pushed down the chain of command and away from the top

Question 21

What are the advantages of a centralised structure?

Answer 21

1. Senior managers are trained and experienced in decision making
2. Coordination and control is easier
3. Senior management had complete control over resources

Question 22

What are the disadvantages of a centralised structure?

Answer 22

1. Employees may be demotivated without any authority
2. Brings less creativity and new ideas
3. People at the top may be out of touch with the needs of customers, served by more local employees

Question 23

What are the advantages of a decentralised structure?

Answer 23

1. Workers have autonomy and may be better motivated
2. Speeds up decision making
   3 Takes pressure off senior managers by reducing their workload
3. Workers get the opportunity to be creative and share their ideas

Question 24

What are the disadvantages of a decentralised structure?

Answer 24

1. Senior managers may lose control of resources
2. Costs may be higher owing to less standardisation and more variability in the decision making process
3. Some employees may not have the ability to make decisions
4. Some employees may not welcome extra responsibility

Question 25

Define matrix structure

Answer 25

Where employees are put into specific teams that cut across departmental roles