structures - advantages and disadvantages

Question 1

Tall structure advantages

Answer 1

1. each staff member knows their role and who to report to
2. with many levels come many promotion opportunities which can motivate staff
3. there is a narrow span of control which means managers have more time for planning, supervision and decision-making; managers can support subordinates

Question 2

Tall structure disadvantages

Answer 2

1. communications take time to flow down through the levels, which slows down decision-making
2. the organisation can be slow to react to changes in the market
3. the narrow span of control means managers supervise work more closely, which can put staff under pressure; managers have fewer staff to share ideas with

Question 3

Flat structure advantages

Answer 3

1. information can be communicated quickly between levels
2. the organisation can respond quickly to external (PESTEC) factors, such as competition
3. there is a wide span of control which means managers have to delegate tasks to staff which can raise morale as staff feel trusted; staff are empowered to make decisions themselves

Question 4

Flat structure disadvantages

Answer 4

1. fewer levels means fewer promotion opportunities so quality staff may leave to gain promotion in larger organisations
2. as there are fewer management levels, staff may be delegated more tasks, which could put them under pressure
3. wide span of control means 1. managers’ time is at a premium which could lead to snap decisions, 2. less time for planning, 3. subordinates may have no one to seek help from

Question 5

Delayering structure advantages

Answer 5

1. money is saved on paying the salaries of the management level that is removed
2. quicker decision-making and communication are possible as there is a shorter chain of command
3. the organisation can be more responsive to changes in the market as there are fewer levels for information to pass through up to the decision-makers
4. there is a wide span of control

Question 6

Delayering structure disadvantages

Answer 6

1. there are fewer promotion opportunities for staff
2. redundancy payments will cost the organisation a significant amount of money
3. the organisation will lose key members of staff in the restructure
4. there is a wider span of control

Question 7

Centralised structure advantages

Answer 7

1. a high degree of corporate identity and strategy exists as decisions are made for the whole organisation
2. procedures are standardised which ensures consistency
3. there is low risk of important information leaking from branches or departments

Question 8

Centralised structure disadvantages

Answer 8

1. less responsibility is given to subordinates which can result in demotivated staff
2. decisions will not reflect the needs of local markets
3. the organisation will react slowly to external (PESTEC) factors, such as the competition improving their product range

Question 9

Decentralised structure advantages

Answer 9

1. the business reacts quickly to changing external factors
2. decisions are made quickly as local managers don’t need to consult senior managers before implementing decisions
3. more subordinates are empowered which encourages creativity
4. senior management at head office are relieved of the burden of constant decision-making

Question 10

Decentralised structure disadvantages

Answer 10

1. the organisation can lose an overall corporate image if each department/branch is operating differently
2. local branches could start to compete with each other if they are allowed to make key decisions
3. additional training required for middle management
4. lower-level management can make decisions that could harm the business as a whole

Question 11

Matrix structure advantages

Answer 11

1. each team has specialised staff from all functional areas
2. complex problems can be solved
3. staff can use their expertise and as such have job satisfaction and motivation

Question 12

Matrix structure disadvantages

Answer 12

1. many managers across all project teams will mean high wage costs
2. duplication of resources such as administration staff and equipment
3. staff can be confused as to who to report to

Question 13

Entrepreneurial structure advantages

Answer 13

1. decisions are made quickly as there is little consultation
2. staff know who they need to report to
3. high-quality decisions are made as decision-makers are experienced

Question 14

Entrepreneurial structure disadvantages

Answer 14

1. this structure can create a heavy workload for the main decision maker
2. if the owner is busy or not available, key decisions can’t be made
3. other staff don’t get a chance to show initiative, stifling creativity and possibly demotivating some staff