Business Structures Flashcards
What three important things does an organisational chart show?
Who has responsibility/authority for decision making, how individual employees are accountable to, who employees are responsible for.
What is structure and hierarchy shown through?
Am organisational chart.
What two things can structures be?
Tall and flat.
What happens if structures are too tall?
It affects communication, messages take a long time to communicate and decisions take a long time to make. A lot of paperwork.
What happens if structures are to flat?
Managers can get overwhelmed by too many people reporting to them.
What is the span of control?
The number of people who report directly to a manager.
What happens if the span of control within a business is too narrow?
Workers can become demotivated because they may feel they are being micromanaged.
What happens if the span of control within a business is to broad?
Managers may find it hard to manage effectively.
Give two advantages of a centralised decision making structure?
Business leaders tend to have lots of experience, managers get an overview of the whole business.
Give two disadvantages of a centralised decision making structure?
Excluding employees from decision making can be demotivating, not many people are experts in ALL aspects of a business.
Give two advantages of a decentralised decision making structure?
Involvement motivates employees, employees can use expert knowledge of their sector.
Give two disadvantages of a decentralised decision making structure?
Subordinates may not have enough experience to make decisions, inconsistencies may develop within different sectors.
What is a centralised structure?
A centralised structure keeps authority for decisions at the top.
What is a decentralised structure?
Decentralised structures share out authority to make decisions.
