Unit 7 Organisational design

Question 1

Advantages of a centralised organisation structure

Answer 1

.Decision making is quicker
.Easier to implement common policies and practices across the organisation, e.g. pricing
.Decisions will be made by the most senior managers so this reduces the risk of mistakes

Question 2

Disadvantages of a centralised organisation structure

Answer 2

.Lack of authority for individual store managers may be de-motivating and may eventually lead to higher labour turnover
.Centralisation ignores the importance of local knowledge that store managers may have
.Can increase bureaucracy / slow decision making

Question 3

Definition of a flat structure

Answer 3

A number of layers of management have been reduced and each manager has a wider span of control

Question 4

Advantages of a flat structure

Answer 4

.Fewer layers of managers may reduce costs
.Communication can be improved due to layers being removed
.Managers have less time for each subordinate and must therefore delegate - staff are given greater responsibility (motivating)

Question 5

disadvantages of a flat structure

Answer 5

.Fewer opportunities for promotion
.Staff may become overstretched (stess)
.if delayering is used to achieve a flat structure, this may create anxiety amongst the remaining staff and harm productivity, attendance and staff retention

Question 6

Advantages of Outsourcing

Answer 6

.Improved focus on core business activities
.Increased reach
.controlled costs

Question 7

Disadvantages of Outsourcing

Answer 7

.Instability - the outsourcing company could go out of business
.Confidentiality and security
.Service delivery - which may fall behind time or below expectation