Organisational Design Flashcards
Hierarchy
(Organizational chart)
Organizational chart, illustrate the structure of the business and the roles of people employed in the business.
They show:
-How the business is spilt in departments
-The roles of employees and their job titles.
-Who has responsibility
-Communication channels
EMPLOYEE ROLES IN THE ORGANISATIONAL
HIERARCHY
-Directors: They run the business representing what owners say. They are in charge of activities done on the business. In small businesses directors = owners. In large, owned by shareholders no.
-Managers: Are responsible for controlling or organizing within the business. The make day to day decisions on running the business.
-Team leaders: Make sure the team work effectively. Resolve issues between team members.
-Supervisors: They monitor and regulate work. They hire, discipline, promote, punish or reward.
-Professionals: These are very qualified people that ensure work is done at high quality. (Architects, engineers).
-Operatives: Skilled workers that are involved in the production process or providing a service. They follow instructions of managers or supervisors.
-General staff: They don’t have an specific work, follow instructions from superiors.
Chain of command
The way authority and power is organized. Orders passed down and info passes up the levels.
Business try to maintain a short chain of command, so info isn’t lost.
Span of control
The number of people a person directly controls.
Wide span of control: controls more people.
Adv: It reduces costs (salaries), improves communication with higher-level managers, as is a flat structure.
Disadv: Efficiency may decrease as manager control many people, motivation may decrease as work load increases.
Narrow: controls less people
Adv: efficiency increases as there is more control, managers feel more motivated as they don’t have work load.
Disadv: employees may feel to controlled so motivation decreases, costs increased.
Centralisation
Complete centralisation means that subordinates have no power at all.
Adv:
-senior management have more control. (More experience)
-Senior management can make decisions thinking about the business in general, subordinates will think in their departments. This helps to maintain a balance in the business.
-Communication improves as there is less people making decisions.
Disadv:
-It demotivates subordinates as they don’t have responsibilities.
-Work overload for senior managers.
-Subordinates are going to be less prepared if they get promoted.
Decentralisation
Means that subordinates have all the authority.
Adv:
-It motivates and empowers workers.
-Reduces stress for senior managers.
-Senior managements can focus on more important tasks.
Disadv:
-Subordinates are less experienced and make take wrong decisions.
-Subordinates may only think about their own department when taking decisions, not the business.
-Communication may be worse as many people take decisions.
Types of organisational structures
(Tall structure)
Has narrow span of control, managers can closely supervise their subordinates, increased efficiency. There’s a clear route for promotion, this helps to motivate employees.
Has a long chain of command, so communication can be poor. Decision making may be slow as there’s bad communication. To much control can demotivate workers.
Flat structures
Chain of command is short, so communication is good. Decision making is quick and effective. There are less managers = less cost. Workers are more motivated as they aren’t closely observed.
Wide span of control, so managers can loose control of subordinates, efficient decreases. Mangers may feel stressed as they are overloaded with work.
Matrix structure
Involve getting people together from different areas in the business to do a project.
Adv: many specialists from different areas in same department. Subordinates feel responsible
Disadv: not all departments have same objectives, conflicts may be created, manager looses control
