Organisational Structures

Question 1

Organisational structures determine…

Answer 1

Authority and responsibility
Individual job roles and titles
The people to whom others are accountable
The formal route through which communication flows

Question 2

Factors that influence structure:

Answer 2

Size of business - informal or flat structures, number of layers, departments and functions.
Type of business - 1/several locations, outsourcing, kind or workforce
Management & leadership style
Competitive environment - influenced by developments in the market

Question 3

Span of control

Chain of command

Answer 3

Order and authority within the business

Number of employees a manager is directly responsible for

Question 4

Pros of a wide structure

Answer 4

Gives subordinates independence
Appropriate if labour costs are significant
Helps with greater creativity

Question 5

Pros of a narrow structure

Answer 5

Closer supervision of employees
More layers may be required
Helps more effective communication

Question 6

Flat structure

Pros

Cons

Answer 6

Fast communications, wider job roles, low number of managers which reduces costs, less supervision

Blurred lines of authority, poor quality control, lack of promotional opportunities

Question 7

Tall structure
Pros

Cons

Answer 7

Clear lines of authority, managers control less staff, promotional opportunities

Slow communication, slow decision making, more supervisions required - higher costs

Question 8

Matrix structure - reporting relationships are organised as a grid
Pros

Cons

Answer 8

Break down traditional department barriers, avoid need for several departments - reduce costs, share resources and ideas - increase motivation

Divided loyalties, no clear line of accountability, difficult to coordinate

Question 9

Hierarchical structure
Pros

Cons

Answer 9

Authority and responsibility clearly defined, employees are loyal to their departments, effective use of specialist managers

Slow responses, inter-departmental rivalry, bureaucratic decision making

Question 10

Centralised
Definition

Pros

Answer 10

Rely on an individual to make decisions and provide direction

Manager has control, standardised procedures - reduce costs, decisions benefit business on a whole, strong leadership and direction

Question 11

Decentralised
Definition

Pros

Answer 11

Daily operations and decision making is delegated

Senior managers are less stressed, more responsibility leads to higher motivation, increased knowledge to employees down the chain, departments can respond faster