organisational design Flashcards
what is organisational design
refers to how a organisation has structured its activities
(look at eg of organisational chart)
advantages of using organisational charts?
shows clear reporting structure
makes planning easier
helps visualise workload of individuals
what is a hierarchical structure?
layered pyramid like structure that depicts inner relationship between departments
what characteristics are seen in a hierarchical structure?
senior people at top
shows chain of command
splits into different functional areas
disadvantages of using organisational structure?
outdated one is useless needs to stay up to date
individuals may take narrow idea of their job
decreased exchange of ideas if structure is rigid as it will lack good communication
advantages of organisational structure having wide span of control
work better delegated so more freedom
improved motivation
less supervision needed so cost of production lowered
disadvantages of organisational structure having wide span of control
increased workload
increased stress as lots of employees to look over
employees can get lazy if not supervised
advantages of organisational structure having narrow span of control
quicker communication
supervised quickly
better co-ordination between workers
disadvantages of organisational structure having narrow span of control
no motivation as little freedom
more costly as supervisors needed
what is a hierarchy
levels of management showing chain of command as u go down authority is reduced
advantages of having a tall hierarchy structure
more promotional opportunities
less delegation so less stress
tight control can be kept
disadvantages of having a tall hierarchy structure
more layers mean more staff so business has high overheads
decisions can take longer
ineffective communication
advantages of having small hierarchical structure?
more delegation could increase staff motivation
decisions made faster
staff have greater freedom to make decisions
disadvantages of having small hierarchical structure?
managers have less time for each subordinate and may neglect them
fewer chances for promotion
what is centralised structures?
majority of the decisions remain responsibility of few at top of hierarchy
advantages of centralised structures?
easy to implement policies
EOS easier to achieve
prevents parts of business becoming independent
disadvantages of centralised structures?
risks demoralising managers who feel powerless
management disconnected from day to day work
decisions delayed as fewer people working on it
what are decentralised structures?
decision making load is shifted down through organisation
advantages of decentralised structure?
reduces burden for management
improves levels of customer service
improves staff motivation
disadvantages of decentralised structure?
decision making is not always strategic
may be some de-EOS
harder to achieve tighter financial control
what are the consequences if business is inappropriately structured
slow decision making causing loss in competitive advantage
de-motivated employees high labour turnover
lack of co-ordination leading to duplication of work
what is outsourcing?
delegation of business processes to an external provider who then manages the procedures to good standard
advantages of outsourcing?
cost efficient - provider may offer service cheaper than doing it themselves
quality - specialist is likely to improve product
professional - provide professional service for benefit of staff and customers increasing motivation
disadvantages of outsourcing?
costly - may not offer service in a cost efficient way
low quality - may not be able to provide service to a higher standard leading to possible customer complaints
poor reputation - business stressed if service will be down ok
what factors does business need to consider before outsourcing
quality - will specialist do better job than them
cost - might be cheaper as they don’t need to make a profit
speed - will there be much difference
flexibility - suppliers likely to have greater capacity
