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Business > Section 2.7 Organisation and Management > Flashcards

Section 2.7 Organisation and Management Flashcards

1
Q

What is an organisational structure?

A

The formal, internal framework of a business that shows how it is managed and organised through levels.

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2
Q

What is a functional department?

A

The main activities of business

Examples: financial, marketing, operations, human resources and research and development

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3
Q

What are the three main features of an organisational structure?

A
  • Levels of hierarchy
  • Chain of command
  • Span of control
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4
Q

What does levels of hierarchy mean?

A

The number of levels in an organisational structure

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5
Q

What does span of control mean?

A

The number of subordinates reporting to each supervisor/manager (length of a level in the organisational structure)

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6
Q

What does chain of command mean?

A

The route through which authority is passed down through an organisation (height of the organisational structure)

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7
Q

What happens to the tasks as you move down the level of hierarchy (wider span of control)?

A

They become simpler

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8
Q

As a business grows, what will happen to the span of control?

A

It will become longer (bigger)

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9
Q

What is a wide span of control?

A

When there are a lot of subordinates reporting to a supervisor/manager

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10
Q

What is a narrow span of control?

A

When there are few subordinates reporting to a supervisor/manager

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11
Q

What are the factors that affect the size of the span of control?

A
  • Difficulty of task (simple task = wide span of control, hard task = narrow soc)
  • The experience and skills of employees (highly skilled = wide soc, less skilled = narrow soc)
  • The size of the business (large business = narrow soc, small business = wide soc)
  • Levels of hierarchy (tall organisation = narrow soc, flat organisation = wide soc)
  • Management style (greater control over workforce = narrow soc, less control over workforce = wide soc)
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12
Q

What are the advantages of a wide span of control?

A
  • Less expensive (as fewer managers/supervisors are needed)
  • Less supervision (improves employees motivation)
  • Faster communication (makes decision-making easier)
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13
Q

What are the disadvantages of a wide span of control?

A
  • Fewer managers/supervisors (reduces promotion opportunities)
  • Less control over subordinates’ work
  • Effective communication may be difficult
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14
Q

What are the advantages of a narrow span of control?

A
  • Effective communication is easier
  • Better control over employees and their work
  • More managers/supervisors (increases promotion opportunities)
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15
Q

What are the disadvantages of a narrow span of control?

A
  • Communication and decision-making are often slower
  • More expensive (because more managers are needed)
  • More supervisors (may reduce employee motivation)
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16
Q

What is a tall organisational structure?

A

An organisational structure with many level of hierarchy

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17
Q

What is a flat organisational structure?

A

An organisational structure with few levels of hierarchy

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18
Q

What is a layer of management?

A

A level of hierarchy except the last (bottom) layer

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19
Q

What is the span of control and chain of command in a tall organisational structure?

A

Span of control: Narrow (as there are several layers of management (hierarchy))

Chain of command: Long

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20
Q

How is the communication and decision-making in a tall organisational structure?

A

Communication and decision-making is often slower because they must pass through several layers

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21
Q

What is the span of control and chain of command in a flat organisational structure?

A

Span of control: Wide (as there are fewer layers of management (hierarchy))

Chain of command: Short

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22
Q

How is the communication and decision-making in a flat organisational structure?

A

Communication and decision-making is often faster because they pass through fewer layers

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23
Q

What is delayering?

A

Reducing the size of the hierarchy by removing one or more level of hierarchy - most often middle management

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24
Q

What is often the middle management?

A

managers of department such as finance and marketing

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25
Q

What are the advantages of delayering?

A
  • Reduces costs
  • Reduces the chain of command (so communication and decision-making should be quicker and more effective)
  • Wider span of control increases the opportunity for delegation (This helps develop employees’ skills and could motivate employees who are given more trust by managers)
  • Senior managers are in closer touch with what is happening in the business
26
Q

What are the disadvantages of delayering?

A
  • Increased workload for managers (could mean that tasks are not completed on time or that the quality of decision-making is not good)
  • Business may have to make redundancy payments to managers who lose their jobs
  • Employees who remain might fear redundancy (reduces their job security)
  • Wider span of control might reduce the effective management of subordinates
27
Q

What is a centralised organisation?

A

Organisation where all the important decision-making power is held at head office, or the centre, or the senior manager (Mostly occurs in international franchise companies)

Example: Every decision in each Pizza Hut franchise is made by one head office/centre/group of senior managers to ensure same level of service and quality in the products of each outlet

28
Q

What is a decentralised organisation?

A

Organisation where the decision-making powers are passed down the organisation to lower levels

Example: A hotel chain, the hotels in Dubai and Pakistan from the same company is different and decisions are made by managers.

29
Q

What are the advantages of a centralised organisation?

A
  • Decision-making is often quicker
  • Decisions are taken for the benefit of the whole business
  • Greater use of specialist staff improves decision-making
30
Q

What are the disadvantages of a centralised organisation?

A
  • Slower communication
  • Unable to respond quickly to change in local markets
  • May reduce employee motivation
31
Q

What are the advantages of a decentralised organisation?

A
  • Decisions are made based on local needs
  • Can be used to train junior managers
  • Delegation helps to improve employee motivation
32
Q

What are the disadvantages of a decentralised organisation?

A
  • Decisions taken might not be in the interest of the whole business
  • Poor decision making might be made because managers lack skills and experience
33
Q

What are the roles in an organisational structure?

Hinte: There are four

A
  • Directors
  • Chief executive office (CEO)
  • Manager
  • Supervisor
34
Q

What are directors and what is their role?

A

Directors are the most senior level of management in any limited company. They are appointed or elected members of the Boards of Directors of the company during the Annual General Meeting (AGM).

Their roles include:
- Setting strategy (the long-term plans for the business)

  • Making sure that the resources are available to achieve objectives
  • Reviewing the performance of managers
  • Protecting the interests of shareholders and other shareholders
  • Providing leadership to ensure the success of the business
35
Q

What is the Annual General Meeting (AGM)?

A

A meeting for shareholders that limited companies must hold once every year

36
Q

What are chief executive officers (CEOs) and what is their role?

A

The most senior manager responsible for the overall performance and success of a company (looks over the day-to-day activities). CEOs also implement decisions of the Board of Directors

37
Q

What are managers and what is their role?

A

An individual who is responsible for a certain group of tasks, or a certain area or department of a business. (Example: human resource manager, finance manager)

Their general roles (for any manager) include:
- Making sure that the decisions of the directors are carried out

  • Delegating tasks to members of their department
  • Taking the decisions needed to achieve departmental targets
  • Motivating employees
  • Solving day-to day problems that may arise within the department
38
Q

What are supervisors and what is their role?

A

An individual who checks and controls the work of subordinates to ensure they carry out the task and checking the quality of the work

39
Q

What are the functions of management?

A
  • Planning
    (looking at where the business is now and where it wants to be in the future, then setting clear objectives)
  • Organising
    (preparing and organising the resources needed to achieve the planned goals and objectives)
  • Commanding
    (controlling and supervising subordinates to motivate employees towards achieving the planned objectives)
  • Coordinating
    (making sure different parts of the business is working together to achieve the objectives and goals)
  • Controlling
    (checking to make sure that the plan is working)
40
Q

Besides the five main functions of management what else must manager do?

A
  • Understand the people who work for them
  • Set a good example
  • Treat subordinates fairly
  • Delegate tasks
  • Communicate effectively
41
Q

What is delegation?

A

Passing authority down through the organisational hierarchy to a subordinate

42
Q

Why may managers not delegate tasks to their subordinates?

A
  • They do not trust that the subordinate will do a good job

- They fear the subordinate will do better at the task than them (threatening their position)

43
Q

What are the advantages of delegation for managers and employees (subordinates)

A
  • More time to focus on more complex task with greater importance
  • Motivates employees as they are given the opportunity to take on the responsibility and develop their skills
  • Employees develop their skills and increases flexibility of the workforce
  • Quality of work is improved because lower-level employees have better skills than their managers for completing certain tasks
44
Q

What are the three leadership styles?

A
  • Autocratic leadership
  • Democratic leadership
  • Laissez-faire leadership
45
Q

What is autocratic leadership style?

A

A leadership style where the leader makes all the decisions. (one-way communication)

46
Q

What is most important to autocratic leaders?

A

The completion of the task

47
Q

How is staff motivation with an autocratic leader?

A

Low as they are not part of the decision-making and they don’t feel valued or important

48
Q

What is democratic leadership style?

A

A leadership style where employees take part in decision-making, and leader makes the final decision (two-way communication)

49
Q

How is staff motivation with a democratic leader?

A

High as they take part of the decision-making and they feel valued and important

50
Q

What is laissez-faire leadership style?

A

A leadership style where most of the decisions are left to the employees (upward from subordinate to manager with no feedback from manager)

51
Q

How is staff motivation with a laissez-faire leader?

A

Could be high or low depending on the task and skills of employees

52
Q

What factors affect which leadership style to choose?

A
  • Skills and experience of the workforce
  • Time available to make a decision
  • Personality of the manager
  • Task to be completed
53
Q

When should you use autocratic leadership?

CAPITAL = Most Important

A
  • Less skilled workers
  • FAST DECISION-MAKING IS NEEDED
  • Personal preference of manager is autocratic
  • Task could be complex or simple
54
Q

When should you use democratic leadership?

CAPITAL = Most Important

A
  • WORKERS ARE SKILLED, EXPERIENCED AND KEEN TO BE INVOLVED IN DECISION-MAKING
  • More time available (to consult employees)
  • Personal preference of manager is democratic
  • Task could be complex or simple (QUALITY OF THE FINAL DECISION WILL IMPROVE)
55
Q

When should you use laissez-faire leadership?

CAPITAL = Most Important

A
  • The personal preference of the manager is laissez-faire
    This type of leadership style is effective for employees involved in CREATIVE TASKS (such as research and development of products)
56
Q

What is a trade union?

A

A trade union is an organisation of employees aimed at improving pay and working conditions and providing others services, such as legal advice, for members

57
Q

How do trade unions help their members?

A
  • Negotiating with employers to improve pay and working condition
  • Resolving conflict between employer and employee
  • Providing legal support and advice to its members
  • Providing services for members
58
Q

What are the advantages of employees being trade unions members?

A
  • Employees have greater power when dealing with employers if they are part of a trade union (collective bargaining)
  • Trade unions provide support and legal advice to employees
  • Trade unions will try to protect employees’ job security
59
Q

What are the disadvantages of employees being trade union members?

A
  • Employees must pay a membership fee to belong to a trade union
  • Decisions of the majority of union members is binding on all members, even if they do not agree with it
  • During strikes, employees lose their wages which cannot be recovered
60
Q

What are the advantages of employers being trade union members?

A
  • Trade unions provide a single point of contact between employees and employers so negotiations are simpler and less time-consuming
  • Trade unions help improve working condition and health and safety in the workplace, which increases motivation and reduce the level of absenteeism and labour turnover
61
Q

What are the advantages of employers being trade union members?

A
  • Powerful unions can force employers to meet the high demand of employees, which will increase costs
  • Industrial action used by trade unions (example: strikes) can disrupt the production and results in reduced profitability.

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