Organizational Design (1.4.3) Flashcards
(20 cards)
What is organisational structure?
Outlines the reporting relationships, roles and responsibilities of employees in the organisation. Businesses must determine what the best structure is for them to effectively implement their ideas and achieve their objectives.
What is a Centralized Structure?
Decision-making authority is concentrated at the top of the organisation. Decisions are made at the Top. Restricts autonomy of Local Management but gives customers consistency across all stores.
Advantages of a Centralized Structure? (3 Advantages)
-Clear chain of command and responsibility
-Focused vision and stratergy
-Reduced Costs and improved quality
Disadvantages of a Centralized Structure? (3 Disadvantages)
-Bureaucracy and red tape
-Less responsiveness to local needs
-Delays in work and lack of employee loyalty
What is a Decentralized Structure?
Decision-making authority is distributed throughout the organisation. Sees each branch make its own decisions. Decisions made locally, closer to customers. Gives Local Managers more responsibility. Managers and Staff more motivated.
Advantages of a Decentralized Structure? (3 Advantages)
-Can improve employee motivation, innovation and creativity
-Can allow faster and more flexible adaption to local needs and customers
-It can reduce the risk of central failure or corruption
Disadvantages of a Decentralized Structure? (3 Disadvantages)
-Can create communication barriers and coordination challenges across the business
-Can lead to inconsistency in quality standards
-It can depend on quality of leadership at lower levels, which may vary or damage the company’s reputation
What are the three different types of organisational structures?
- Matrix
- Tall
- Flat
What is the Matrix Structure?
Cross-functional teams are assembled to complete projects. Speeds up communication between departments. Develops Staff across multi-departments processes. Combine functional areas of a business (HR, finance, marketing, sales) with a specialist team that operates inside the business
Advantages of a Matrix Structure? (6 Advantages)
-Flexible and Dynamic
-Increased motivation
-Efficient employment of Resources
-Teamspirit
-Reduced Burden
-Better supervision and control
Disadvantages of a Matrix Structure? (5 Disadvantages)
-Difficult to manage
-Expensive structure
-Complex chain of command
-Chance of Failure
-Conflict and misunderstanding
What is a Tall organisational Structure?
Lots of Layers of Management with narrow spans of control. Offers plenty of promotional opportunities. Expierenced staff have decision making power.
What are the Advantages of a Tall organisational Structure? (3 Advantages)
-More Distributed managerial roles
-More Control over business operations
-Clearly defined career path and promotion path
What are the Disadvantages of a Tall organisational Structure? (3 Disadvantages)
-Slow decision-making
-High costs due to more managers
-reduced employee empowerment and motivation
What is a Flat organisational Structure?
Limited Layers of management with wide spans of control. Very quick vertical communication and operational decisions can be made quickly. Staff have freedom and flexibility which can be motivating.
What are the Advantages of a Flat organisational Structure? (3 Advantages)
-More responsive to change +decision-making quicker
-Staff can be empowered to work independently + take more responsibility
-Lower Labour Costs due to fewer managers
What are the Disadvantages of a Flat organisational Structure? (3 Disadvantages)
-Management can easily loose control over a large number of employees
-Work relations could struggle due communication issues
-Limited career progression
What is Span of Control?
The amount of people directly under the separation of a manager.
What are examples of Tall and Flat organisational Structures?
Tall= Tesco, NHS
Flat= Netflix, Spotify
What is a chain of command?
Formal line of authority that flows down from the top management to lower-level employees
