Organisational Structures Flashcards
Tall/hierarchal
Lots of layers
More formal + bureaucratic
Narrow span of control
Long chain of command
More promotion opportunities
Flat
Few layers
Communication is quicker
More delegation (responsibility is passed onto someone else) + empowerment
Less formal
Reasons for tall
Everyone knows lines of communication
Leadership is clear
More guidance
Reasons for flat
More empowering (more control)
Teamworking + trust + online work (flexible)
Better for sharing ideas (feel more able to talk to supervisors etc
Cheaper (less people + layers)
Delayering
Process of removing layers in a business
Advantages of delayering
Less costs (long term)
Easier communication
More delegation for employees
Disadvantages of delayering
Redundancy costs
Span of control will widen (less time to invest in each individual employee
Damage to staff morale (worried about further cuts in staff)
Centralised structure + Pros and Cons
Senior management make all decisions (eg the board)
Pros: eos eg marketing, quicker decision making, easier to implement policies for whole business
Cons: more bureaucratic, lower down staff are more likely to know whats good for customers etc (work with them), customer service lacks flexibiility
Decentralised structure + pros + cons
Decision making is delegated across business to include more junior managers (not everyone)
Pros: better able to respond to customer needs ( better service), good way of training and developing junior management
Cons: takes longer to make decisions, harder to ensure consistent practices, lack of strong leadership when in a crisis
Organisation by function + pros + cons
Organised into functions eg HR, finance etc
Each function works on overall portfolio (all products)
Pros: specialists concentrate on what theyre best at + work together, less duplication
Cons: conflict over budgets, segregation of functions = harder to communicate about dif products, difficult to see success or credit it ( or blame if something goes wrong)
Organisation by product + pros + cons
Organised according to different products made
Each product becomes a mini company (with own finance, HR, etc)
Pros: easy to see profit centres (which products are performing well), each mini company has independence (motivates), teams can see direct results, communication barriers are broken for specialists (HR etc)
Cons: different products compete for rev (conflict), duplication of departments (wasted of resources), teams may lose sight of overall direction of business
Matrix structure + pros + cons
2 lines of management
Individuals work across teams and projects (teams may be temp or permanent)
Pros: use skills in dif contexts (variety), more motivation, share resources across departments (cost effective)
Cons: complex to coordinate, may take time getting used to, divided loyalties may be hard/stressful, team members may neglect functional responsibility
Organisation by system
Same as function (each function has an input into products)
Organisation by division
Similar to product but each division can be in different geographical areas
PROS: compare performance of each region + any product ones
