Human Resources

Question 1

Why do businesses have organisational structures?

Answer 1

It helps people in the hierarchy to

• Know what their duties are
• The person or people they have to report to
• Who they are responsible for

Without this internal structure, business activity would not be productive and not coordinated

Question 2

What is the span of control?

Answer 2

The span of control is the number of employees managed directly by another employee

Question 3

How does the span of control affect business activity?

Answer 3

Businesses should not aim to have a wide span of control. It should be narrow. Experts recommend that the maximum span of control for a manager should be no more than six. This is because there will be management issues with employees as there will be insufficient time to spare for each employee

Question 4

What are layers of hierarchy?

Answer 4

Layers of authority within a business

Question 5

What is chain of command?

Answer 5

The chain of command is the line of authority within a business along which communication passes

Question 6

What is delayering?

Answer 6

Delayering is the removal of one or more levels of hierarchy from a business’ organisational structure

Question 7

What are the advantages of delayering?

Answer 7

To reduce costs
To reduce the number of managers employed

Question 8

What are the disadvantages of delayering?

Answer 8

Junior employees may have to take on new duties, risking dips in quality or productivity if motivation is lacking

Some senior employees may have very wide spans of control when a level of hierarchy is removed

Question 9

What is delegation?

Answer 9

Delegation is the passing down of authority to more junior employees (subordinate)

Question 10

What are the two types of organisational structures?

Answer 10

Tall and flat

Question 11

What are the characteristics of a flat organisational structure?

Answer 11

Wide spans of control and few levels of hierarchy

Question 12

What are the characteristics of a tall organisational structure?

Answer 12

Narrow spans of control and a larger number of levels of hierarchy

Question 13

What is the impact of having a tall one flat organisational structure on management?

Answer 13

A tall structure is associated with a management style where little use is made of delegation and managers take most decisions.

A flat structure encourages a management style that relies on delegation. Employees are more independent and not so controlled by their line managers

Question 14

How can businesses use the appropriate organisational structure?
(What does it depend on?)

Answer 14

The skills of the workforce: if a workforce is highly skilled, managers can choose a wider span of control and so a flat organisational structure. Delegation will not have an impact on quality of the firm.

The management style used: managers that like to retain control over employees will be more likely to use a tall organisational structure. As a result, a narrower span of control so more monitoring and supervision.

The business’ competitive environment: A business in a competitive environment may want to keep costs at a minimum by reducing wage costs and so delayer to have the best possible performance. This flat structure may also motivate employees as they are given more authority as there is a wider span of control

Question 15

What is internal recruitment?

Answer 15

Internal recruitment takes place when a job vacancy is filled from within the existing workforce

Question 16

What are the advantages of internal recruitment?

Answer 16

Candidates will have experience of the business and will be familiar with its methods and working —> quality is constant and production is stream lined

Candidates will know many of the people with whom they are working in the hierarchy

Provides candidates with a chance of promotion, which may motivate and increase productivity

Cheaper and avoids the need for expensive external advertising of external recruits

Question 17

What are the disadvantages of internal recruitment?

Answer 17

A business can only choose from a limited number of employees and they might not have the skills required or desired

May have to pay for training when promoting or transferring employees

Question 18

What is external recruitment?

Answer 18

External recruitment is filling a job vacancy from any suitable person NOT already employed by the business

Question 19

What are the benefits of external recruitment?

Answer 19

Managers will have a wider choice of candidates and this can result in applications from higher quality ones

They may diversify the business and be entrepreneurial, providing suggestions and adaptations to the USP. Makes the business more competitive

No need to train as they already have the skills necessary

Question 20

What are the disadvantages of external recruitment?

Answer 20

The business knows less about the employee. More likely to make a mistake and impact quality

More expensive because of advertising