Unit 4.1 - Organisational structures

Question 1

Define span of control

Answer 1

The number of people a manager has to organise and lead

Question 2

Define hierarchy

Answer 2

The power relationship between members of the business. The most important person is at the top

Question 3

Define chain of command

Answer 3

Order in which authority and power in an organisation is wielded and delegated from top management to every employee at every level of the organisation

Question 4

Define delegation

Answer 4

A senior person asking a more junior person to complete a certain task or activity

Question 5

Define delayering

Answer 5

Removing one or more layers from the hierarchy, in order to cut back on costs and make the business run more efficiently

Question 6

Define tall structure

Answer 6

An organisation with many layers in its hierarchy, a narrow span of control and a long chain of command

Question 7

Define flat structure

Answer 7

An organisation with few layers in the hierarchy, a wide span of control and a short chain of command

Question 8

Define centralisation

Answer 8

The majority of decisions are taken by senior managers and then passed down the organisational hierarchy, made at the headquarters

Question 9

Define decentralisation

Answer 9

Where authority is delegated down the chain of command, thus reducing the speed of decision making, the branches make the decision not headquarters

Question 10

Benefits of a tall structure (2)

Answer 10

Promotional opportunities

Can communicate with superior - motivating

Question 11

Costs of a tall structure (3)

Answer 11

Communication up and down can be slow and difficult
Verbal communication (face to face) can be difficult as numerous people may be involved throughout the hierarchy
Decision making slower

Question 12

Benefits of a flat structure (3)

Answer 12

Faster communication
Increased responsibility
Decision making likely to be quicker

Question 13

Costs of a flat structure (3)

Answer 13

Communication can still be tricky - due to the wide span of control
Less promotional opportunities
Less contact with superior

Question 14

Benefits of a centralised structure (2)

Answer 14

Decisions made by experienced people

Decision made with the whole business considered

Question 15

Costs of a centralised structure (3)

Answer 15

Can be slow
Take time to filter through the organisation
Lead to poor decisions if they don’t have the knowledge for the decision

Question 16

Benefits of a decentralised structure (2)

Answer 16

Expert knowledge used

Quicker decision making

Question 17

Costs of a decentralised structure (2)

Answer 17

Inconsistencies throughout the business

Decisions not taking in overall interest of business

Question 18

Explain functional based structure

Answer 18

Each functional area does a specific piece of work for the business

Question 19

Explain product based structure

Answer 19

Splits into different sectors on the variety of products that are provided

Question 20

Explain region based structure

Answer 20

This based on the area they are working

Question 21

Benefits of a functional based structure (1)

Answer 21

Specialisation

Question 22

Costs of a functional based structure (1)

Answer 22

Departments may not work well together

Question 23

Benefits of a product based structure (1)

Answer 23

Better decision making - relevant to each product

Question 24

Costs of a product based structure (1)

Answer 24

Duplication of resources

Question 25

Benefits of a region based structure (1)

Answer 25

Easier to control

Question 26

Costs of a region based structure (1)

Answer 26

Duplication of resources