Organisational design 1.4.3

Question 1

What is Organisational design?

Answer 1

Organisational design is the framework that provides a business with a structure to achieve its objectives.

Question 2

What is organisational structure?

Answer 2

The way in which the workforce within a firm is organised, including job roles and communication flows.

Question 3

What are organisation charts?

Answer 3

Provide a visual representation of the organisational structure.

Question 4

What does Hierarchy mean?

Answer 4

Hierarchy is the structure of the workforce within an organisation showing who is accountable to whom

Question 5

What are the two different types of structure?

Answer 5

Tall and Thin

Wide and Flat

Question 6

How do the two levels of the hierarchy differ

Answer 6

• The levels of hierarchy within firms will differ:
• Tall and thin structures occur where each superior is responsible for a few subordinates
• This allows for closer supervision and communication between the two levels
• Wide and flat means that each superior is responsible for a large number of subordinates
• This requires greater delegation but fewer levels allowing for quicker communication through the firm

Question 7

What is the Chain of command?

Answer 7

Chain of command is the way authority and power is passed down the levels of hierarchy.

Question 8

What is the Span of control?

Answer 8

The span of control shows the number of subordinates that a manager or supervisor is directly responsible for.

Question 9

If a manager has many subordinates this is called a _____?

Answer 9

Wide span of control

Question 10

If a manager has few subordinates this is called ___?

Answer 10

A narrow span of control

Question 11

What is authority?

Answer 11

Authority is the power of an employee to instruct subordinates, make decisions and control the use of resources

Question 12

What are the two types of authority?

Answer 12

• Centralised
• Decentralised

Question 13

What is centralised?

Answer 13

When the responsibility for decision-making is maintained, by a limited number of senior managers - at the top of the hierarchy.

• few decision makers.
• Decisions made by those at the top of hierarchy.
• Speeds up decision-making.
• maintains tight control.
• Bureaucratic.

Question 14

What is decentralised?

Answer 14

When the responsibility for decision-making is delegated to a number of middle managers throughout the hierarchy.

• Delegates decision-making.
• Decisions made at many levels within hierarchy.
• frees up management time.
• provides motivation.
• Reduces bureaucracy.

Question 15

What factors influence delegation, centralisation, decentralisation?

Answer 15

• organisational design.
• Skills and attitudes of workforce.
• Nature of the decisions to be made.
• Attitudes/parties of leaders and their preferred leadership styles.
• Business objectives.

Question 16

What is a matrix structure?

Answer 16

Is one where teams are put together from different functional areas to work on specific projects.

Question 17

What are the advantages of a matrix structure

Answer 17

• Communication across functional areas
• Range of view points considered
• Functions support and understand each other
• Motivational

Question 18

What are the disadvantages of a matrix structure?

Answer 18

• Potential loss of control
• Dependent upon effective delegation
• Teams may take time to work together effectively
• Can cause conflict

Question 19

What is the impact of different organisational structures on business efficiency and motivation?

Answer 19

A poorly organised organisation structure means that there will be low productivity, less delegation of work, no incentives provided and centralised decisions.