Theme 1 Topic 6 - Organisational Structure Flashcards
What are three things an organisational chart shows?
The roles/titles of individuals, The chain of command, The units and divisions of the individual managers
Define Organisational Design
Creating the formal hierarchy that establishes who is answerable to who throughout the organisation
Define Functional Structure
When the organisation is divided into functional areas e.g. finance, marketing, operations
Define Centralised Structure
Decision making and control remains in the hands of the top management level
Define Decentralised Structure
Delegates decision making to workers lower down the organisation
What are three characteristics of a centralised structure?
Decisions made at the top, Restricts authority for local managers, Consistency for customers
What are three characteristics of a decentralised structure?
Decisions made locally/closer to the customers, Gives local managers more responsibility, Staff are more motivated
Define Levels of Hierarchy
The number of layers of authority within an organisation
Define Chain of Command
Shows how authority is organised through various levels of the hierarchy
Define Span of Control
The number of subordinates reporting directly to a manager
Define Tall Organisational Structure
Has more layers in its hierarchy and a smaller span of control
What are three advantages of a tall organisational structure?
Easier to get promotion, Smaller span of control, Lots of support from manager
What are three disadvantages of a tall organisational structure?
Communication is lost, Harder to get to the top, Labour costs are high as there are more managers
Define Flat Organisational Structure
Has fewer layers in its hierarchy and a wider span of control
What are three advantages of a flat organisational structure?
Better communication, Higher chance of promotion to top, Cheaper labour costs
