structures

Question 1

what are the six organisational structures?

Answer 1

• entreprenurial organisational structures
• tall organisations
• flat organisations
• centralised organisations
• decentralised organisations
• matrix organisational structures

Question 2

what are the features of entreprenurial organistional structures?

Answer 2

• common in small or start-up businesses
• decision making is centralised
• flat structure with few layers of hierarchy

Question 3

what are the advantages of entreprenurial organisational structures?

Answer 3

• centralised control enables quick decision making and swift responses to challenges and opportunities, which is crucial in the early stages of a business
• employees know who makes the decisions, resulting in clear leadership and streamlined communication
• the founder or leader often has a strong vision which can directly shape the company’s direction and culture

Question 4

what are the disadvantages of entreprenurial structures?

Answer 4

• centralised leadership can lead to decision-making mistakes if the leader is overwhelmed
• as the business grows, this structure can become inefficient and may struggle to scale
• the success of the business is heavily reliant on the capabilities of one or a few people
• the structure may lack the formal departments needed for specialist tasks, leading to inefficiencies as the business expands

Question 5

what are the features of tall organisational structures?

Answer 5

• typically found in large organisations
• several layers of authority/hierarchy (from senior managers to supervisors to lower-level employees)
• each employee reports to a specific manager
• decision-making follows a top-down approach
• employees typically have specialised roles within departments, making communication and tasks more focused

Question 6

what are the advantages of tall organisational structures?

Answer 6

• managers oversee fewer employees, allowing them to closely monitor and guide their employees, leading to better performance management
• managers and employees in each layer can focus on specific areas of expertise, leading to a higher level of skill development in their respective roles
• the chain of command is well-defined, so employees know who to report to, and responsibilities are clear at each level
• with many levels of management, employees may have more opportunities for promotions and advancement within the organisation

Question 7

what are the disadvantages of tall organisational structures?

Answer 7

• with many layers of management, decisions may take longer to pass through the hierarchy, leading to delays in action and response
• the rigid structure can stifle creativity and innovation, as employees at lower levels may not have the authority to make decisions or propose new ideas
• having many layers of management increases overhead costs, as more managers are needed to oversee each level of the organisation

Question 8

what are the features of flat organisational structures?

Answer 8

• typically found in small to medium sized organisations
• there are only a few layers between the top executives and the rest of the employees, sometimes only one or two
• managers oversee a larger number of employees, leading to broader responsibilities for each manager
• authority is often distributed among employees, allowing them to make decisions without needing approval from higher-ups
• employees often have more independence and flexibility in how they carry out their tasks, with less direct supervision

Question 9

what are the advantages of flat organisational structures?

Answer 9

• with fewer layers of management, decisions can be made more quickly, leading to greater agility in responding to changes or opportunities
• with fewer managerial positions, overhead costs related to management salaries are reduced
• the decentralized nature of the structure allows employees more freedom to be creative and suggest new ideas, which can foster innovation
• with fewer layers to pass through, communication is more direct, reducing the chances of distortion and promoting transparency

Question 10

what are the disadvantages of flat organisational structures?

Answer 10

• managers in flat organisations may be stretched thin, as they have to oversee a larger number of employees, leading to potential high levels of stress and even burnout
• with fewer clear hierarchies and levels of management, employees might experience confusion about their responsibilities or who to report to.
  In a flat structure, there are fewer opportunities for promotion or advancement, which could result in employee dissatisfaction over time
• the wide span of control means that individual employees receive less supervision and feedback, which can be an issue for those who need more guidance
• as the organisation grows, the flat structure can become less effective, leading to potential management and coordination issues in larger companies

Question 11

what is a centralised organisation?

Answer 11

• a centralised structure keeps decision making and authority at the top of the hierarchy, amongst the senior managers

Question 12

what are the advantages of centralised organisations?

Answer 12

• easier to implement common policies and standardised procedures across the whole business
• easier to co-ordinate and control from the centre.
• usually quicker decision-making

Question 13

what are the disadvantages of centralised organisations?

Answer 13

• lack of authority down the hierarchy may lead to lack of motivation for junior managers
• can lead to demotivated staff who are not being given the opportunity to be involved in the decision-making process
• customer service can be less effective since decision making can be slower and less flexible locally

Question 14

what is a decentralised organisation?

Answer 14

• decentralised organisations delegate decision making further down the hierarchy, away from the centre. It involves more managers in the hierarchy

Question 15

what are the advantages of decentralised organisations?

Answer 15

• involving staff in decision making can improve levels of motivation and commitment
• the business will be more responsive to changes in individual/local markets as staff in each department have a greater local knowledge
• involving staff in decisions can lead to greater creativity and innovation
• decentralisation is well suited to businesses aiming for a flat structure
• decentralisation is a good way of training and developing junior managers

Question 16

what are the disadvantages of decentralised organisations?

Answer 16

• decentralised organisations delegate authority down the chain of command, thus reducing the speed of decision-making
• decentralisation may lead to poor decisions as junior managers may not be as experienced as the managers in the head office
• decision-making may be less strategic
• harder to ensure consistency of policies and standardised procedures throughout the business
• harder to achieve tight financial control – risk of rising costs

Question 17

what is a matrix structure?

Answer 17

in a matrix structure, individuals from different functional areas or departments come together to work in project teams

Question 18

what are the advantages of a matrix structure?

Answer 18

• can help to break down traditional department barriers, improving communication across the entire organisation
• can allow individuals to use particular skills within a variety of contexts
• different employees can be a project leader at different times
• allows employees to develop new skills on different projects
• a good way of sharing resources across departments – which can make a project more cost-effective

Question 19

what are the disadvantages of a matrix structure?

Answer 19

• employees may have to report to two different managers, potentially leading to divided loyalties
• working simultaneously on a project team while also in a functional role can create a heavy pressure of work for individuals
• there may not be a clear line of accountability for project teams given the complex nature of matrix structures
• can be expensive and difficult to co-ordinate

Question 20

what does delayering involve?

Answer 20

delayering involves removing one or more levels of hierarchy from the organisational structure

Question 21

what are the advantages of delayering?

Answer 21

• it offers opportunities for better delegation, empowerment and motivation as the number of managers is reduced and more authority passed down the hierarchy
• it can improve communication within the business as messages have to pass through fewer levels of hierarchy
• it can reduce costs as fewer (expensive) managers are required
• it brings managers into closer contact with the business’ customers – which should result in better customer service

Question 22

what are the disadvantages of delayering?

Answer 22

• not all organisations are suited to flatter organisational structures - mass production industries with low-skilled employees may not adapt easily
• delayering can have a negative impact on motivation due to job losses, especially if it is really just an excuse for redundancies
• a period of disruption may occur as people take on new responsibilities and fulfil new roles
• those managers remaining will have a wider span of control and if it is too wide can damage communication within the business

Question 23

what is downsizing?

Answer 23

downsizing is when a firm closes down or merges aspects of their operations in order to:
- reduce costs
- remain competitive in the marketplace