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Edexcel Business A level Unit 1 > Organizational Structures > Flashcards

Flashcards in Organizational Structures Deck (23)
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What are organizational structures?

Organizational structures are the way in which a business is arranged.


What do they define?

The workforce roles of employees and their job titles.
The route through which decisions are made.
Who is responsible for and who is accountable to who.
How employees communicate with each other.


What is hierarchy?

A hierarchy shows different levels of authority and responsibility in a business.


What is the role of Directors?

appointed to run the business on behalf of its owners. Owners can sometimes also be directors.


What is the role of managers?

responsible for controlling or organizing within the business. Often make day-to-day decisions.


What is the role of team leader?

members of smaller teams with responsibility to resolve issues between team members.


What is the role of supervisors?

monitor and regulate the work in their assigned or delegated area.


What is the role of professionals?

positions for staff with a high level of qualifications and expertise.


What is the role of operatives?

positions for skilled workers who are involved in the production process or service provision.


What is the role of general staff?

carry out positions/jobs in a business without having specific skills.


What is a chain of command?

A ‘chain of command’ is the way authority is organized in an organization.


What is a span of control?

A ‘span of control’ is the number of people, or ‘subordinates’, that a person directly controls in a business.


What is responsibility?

‘Responsibility’ involves being accountable or being required to justify an action.


What is authority?

‘Authority’ is the ability to carry out a task, such as a finance manager having the authority to sign cheques?


What is a centralized system?

A centralized system involves all management decisions being made strictly at the top level of an organization.


What is a decentralized system?

A decentralized system involves daily operations and decision-making responsibilities are delegated by top management to middle and lower-level mangers.


Advantages of a centralized system

Senior management have more control.
Procedures are standardized through the whole organization.
Senior managers can make decisions from the point of view of the business as a whole.
Senior managers should be more experienced and skillful in making decision as they work with the entire business.


Disadvantages of a centralized system

Work may be delayed as messages take longer to reach appropriate area.
Senior managers may be overworked or stressed.
Subordinates may be demotivated due to lack of opportunities.


Advantages of a decentralized system

Empowers and motivates workers as they have more say in decisions.
Reduces the stress and burdens on senior managers.
Provides subordinates with greater job satisfaction.
Subordinates will have better knowledge of their individual area of the business.
Having multiple decision makers should allow decisions to be made more quickly.


Disadvantages of a decentralized system

There may be a lack of consistency throughout the business.
Senior managers may not have as much control as they like.


What is a tall organizational structure?

Involves a small span of control. This means that managers have more control over their subordinates and employees can be more closely supervised.
But management costs can be higher as there are more managers and communication can be poor due to a long chain of command.


What is a tall organizational structure?

Communication can be better as the chain of command is generally smaller. Communication can be quicker and there is less potential for messages to be distorted. Employees may be empowered as they have more responsibility.
However, managers may lose control of their workers as chain of command is wide.


What is a matrix organizational structure?

Talents of employees in different departments are used for multiple projects, which can be empowering. Gives employees trust to carry out multiple projects.
However, can be expensive due to support systems required and extra administrative costs.