Exam Study - Ch. 11 Organisational Strategy & Structure Flashcards
What is an organisation?
A collection of people working together to achieve a common purpose
Define organisational structure and what it entails.
The arrangement of people and tasks to accomplish organisational goals.
It entails:
- Span of control
- Chain of command
- Levels in the hierarchy
- Departmentalisation
- Centralisation/decentralisation
- Formalisation
What is organisational design?
The process of creating a structure that best fits a purpose, strategy and environment.
What is meant by the “context of managing”?
- Input
- people
- finance
- materials - Managing transformation (throughput)
- organisational structures
- objectives
- culture
- power - Output
- goods
- services
- reputation
- waste
What are the components of organisational strategy?
- Purpose (mission/vision)
- Goals
What two types of organisational structures are there? Explain them.
- Mechanistic structure
- Hierarchical bureaucracies that emphasise specialisation, control, vertical communication, rules, policies and procedures. - Organic structure
- A network designed to respond to rapid changes in the environment. Empasis on horizontal specialisation, personal co-ordination, informal communication, loose rules, policies and procedures.
Name some features of the mechanistic structure
- high specialisation
- narrow span of control
- rigid departmentalisation
- clear chain of command
- centralisation
- high formalisation
Name some features of the organic structure
- cross-functional teams
- cross-hierarchical teams
- free flow of information
- wide spans of control
- decentralisation
- low formalisation
What are Mintberg’s 5 Co-ordinating Methods?
- mutual adjustment (someone makes a change, others react)
- direct supervision - standardisation of worker input/skills (predetermined KSA)
- work processes - outputs (KPOs, how much to sell etc)
Define “departmentalisation” and name some types
The process of subdividing work into specialised departments.
Types:
- Functional
- Territorial
- Product or service
- Customer
- Hybrid
What is meant by “work specialisation” and what are the pros and cons?
Work specialisation is the degree to which organisational activities are subdivided into separate jobs.
Pros:
- Greater efficiency and lower costs
Cons:
- Greater (human) costs when carried too far
What is meant by the “chain of command”?
It is the unbroken line of authority that extends from the top down and determines who reports to whom.
The hierarchical reporting relationship.
What is meant by the “span of control”?
The number of people a manager is efficiently and effectively expected to direct.
The limitation of subordinates who can effectively be supervised is based on the total of direct and cross-relationships.
If the span is too wide, it becomes more difficult and places more stress on the manager. Larger groups also give rise to informal leaders and cliques.
If the span is too narrow, it hampers co-ordination and consistency in decision-making. Too close supervision may obstruct morale and initiative. Also, it leads to a longer chain of command.
What is meant by “centralisation”?
The degree to which decision in an organisation are concentrated at a single point.
- only includes formal authority
- high centralisation when only top managers make decision
- low centralisation when front line employees & supervisors make decisions
- the trend is towards decentralisation
What is meant by “formalisation”?
The degree to which jobs within the organisation are standardised.
Formal = minimum input from employees about what is to be done, when and how.
Informal = freedom to act as necessary
