Session 3 - Organization Structure

Question 1

Each employee should report to a single manager

Answer 1

Unity of command principle

Question 2

The extent to which the work is broken up among individuals (ie specialists vs generalists) and departments

Answer 2

Division of labor

Question 3

The extent to which decision making is concentrated: in the hands of a few, or delegated down/across chain of command

Answer 3

Centralization vs Decentralization

Question 4

Departments include production, sales and marketing. Managers have the authority to take decisions

Answer 4

Line

Question 5

Departments include finance, IT, HR. Managers provide research advice, recommendations.

Answer 5

Staff

Question 6

The extent to which rules and regulations direct employees&managers

Answer 6

Formalization

Question 7

The number of direct reports under a single manager

Answer 7

Spans of control

Question 8

✅Advantages - Efficient, necessity for large organisations, no role/job ambiguity
❎Disadvantages - Usually, slow decision-making and communication, lack of flexibility, and usually leads to bureaucratic mindset and creation of “red tape”.

Answer 8

Bureaucratic Structure

Question 9

✅Advantages - Simple and efficient, experience, specialist staff, standardisation, greater communication and collaboration, economies of scale, enforced accountability of the heads of functions/departments.
❎Disadvantages - (1) Focus on functions rather than on customers, markets and products, and (2) can produce “Silos”, leading to slower communication and decision-making. Lack of variety and job enrichment for employees, and rigid procedures limit flair and ingenuity.

Answer 9

Functional Structure

Question 10

✅Advantages - Senior management time freed up, greater local knowledge and understanding, motivation through greater decision powers, speedy decision-making of elements that are within its purview.
❎Disadvantages - Duplication of service/cost and functions, lack of specialisation, extra processing, coordination and collaboration more difficult, divisional self-interest vs business profit/benefit.

Answer 10

Product/Divisional Structure

Question 11

• Straight-line to business head for day-to-day role activities
• Dotted-line to parent function for career growth and development
  ✅Advantages - Customer/market/product focus, faster communication and decision-making, better business orientation/ownership.
  ❎Disadvantages - Complex as the two lines of authority

Answer 11

Matrix Structure

Question 12

• Focal unit is team not department
• Decentralizes decision-making to team level
• More autonomous, lower specialization

Answer 12

Team Structure

Question 13

• Authority/decision making centralised in a single person
• Low degree of departmentalization
• Wide Spans of control
• ‘Flat’, usually 2 or 3 layers
• Little formalization
• Loose body of employees
• Focus on ‘Goal Accomplishment’

Answer 13

Simple Structure

Question 14

Operate on the “Why own when you can rent” philosophy with a degree of outsourcing of non-core functions. Small core, with strong ties to other organisations or individuals.

Answer 14

Virtual/Network Structure

Question 15

OGSM Framework

Answer 15

Framework for alignment and management
OBJECTIVES, GOALS, STRATEGIES, MEASURES