UNIT 2.2 : Types of Organizational Structure Flashcards
What is a flat (horizontal) organization?
it has a few layers of management with a wide span on control and a short chain of command
- found in small businesses/firms and its informal
does a flat organization have a long or short chain of command
A short chain of command
- few layers of management
does a flat structure organization have a wide or narrow span of control
Wide span of control
- looks over large number of people
What types of organizations typically use a flat structure?
start up businesses, small organizations and organizations that value creativity and flexibility
What are the advantages of a flat organization?
Improved communication.
Encourages creativity and flexibility.
Greater decision-making authority for managers.
What are the disadvantages of a flat organization?
Difficult to supervise employees due to the wide span of control.
Informal culture may lead to unclear responsibilities.
What is the organizational culture like in flat structures?
Open, informal and encourages creativity
How does a flat structure change as an organization grows?
it become more formal and shifts to a tall structure with more layers of management and narrow span of control
What is a Tall Organization?
it is an organizational structure with many layers of management in its hierarchy, it is formal, inflexible and has clear liners of seniority.
What is the structure of a tall organization?
- CEO at the top with high authority
- Several layers of middle management
- Employees at the bottom with minimal responsibility and limited decision making power
Where are tall structures commonly used?
Large Business, central governments and the military.
What are the characteristics of tall organizations?
- Highly formal and bureaucratic
- Long chains of command
- Narrow Span of control
- Ridgid and inflexible structures
What are the advantages of tall structures?
- Clear lines of accountability.
- Better control by senior managers.
- Motivational for employees due to promotion opportunities.
What are the disadvantages of tall structures?
- slow decision making due to long chain of command
- risk of miscommunication
- bureaucratic and unvalued employees
What is organization by product?
structuring the workforce based on goods or services sold, with departments focusing on specific product lines
Which types of businesses use organization by product?
Large businesses with broad product portfolio such as Ford and Volkswagen and publishing firms like Holder education
What are the advantages of organization by product?
- Encourages specialization in market segments
- Helps meet customer needs more effectively
- Improves product knowledge and marketing activities
- Encourages internal competition between departments
What are disadvantages of organization by product
- Duplication of work
- Miscommunication between departments
- Higher resource requirements to maintain separate divisions
Why is organization by product suitable for large businesses?
it allows specialization and focus on different product lines within a broad portfolio, which improves efficiency and meets customer needs
What is organization by function?
A structured workforce based on a businesses function such as marketing, Human Resources, production and finance
Who is in charge of each functional department?
A manager or direction is responsible for overseeing the functional area
What type of businesses is organization by function most suitable for?
Small businesses that focus only on one product or small numbers of goods or services
What is the main advantage of organization by function?
Roles and tasks are preformed by experts, ensuring high productivity and outcomes
What is a major drawback of organization by function?
Departments are often isolated, focusing only on their area of responsibility which limits collaboration
