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Organisational structures - Coggle Diagram
Organisational structures
Terminology
Organisational structure
the interrelationships and hierarchical arrangements within the firm
Organisational chart
An organizational chart is a diagrammatic representation of an organization’s formal organizational structure
Chain of command
the formal lines of authority in an organization.
Large businesses will have long chains of command
Smaller businesses will have flater chains of command
Bureaucracy
administrative systems within an organization.
This includes the formal policies and procedures of the business.
A bureaucratic organization is one that has a lot of formal rules, regulations and procedures
More common in larger organisationswith tall hierarchical structures
Adv
better control
better for centralized structures
Dis
very inflexible
less creativity and inovation
levels of hierarchy
the number of layers of formal authority.
Tall structure
narrow span of control
wide chain of command
More centralised decision making
Flat structure
flat chain of command
narrow span of control
Decision making is more decentralised, and takes longer
Delayering
When an organisation removes a layer in their hierarchical structure
Benefits
Reduce bureaucracy
Reduce costs
Disadvantages
DCAn cause demotivationa and stress
adds more workload on employees
Span of control
how many workers are directly accountable to (or under the authority of) a particular line manager
Narrow span of control in companies which want tighter control
Wide span of control in companies which managers have less control but it still requires strong leadership
The span of control depends on
managerial competencies
depends on manager's opinion
the business itself
Larger businesses like MNCs normally have wider spans of control
Employee competencies
better employees will lead to wider span of controls, as they don't need to be vigilated
Matrix structure
a flexible organizational structure based on the specific needs of a particular business to meet the changing needs of the organization.
Adv
Adapts to demand
Increased flexibility
Dis
conflicting interest can arrise
sub-cultures formed
Increased work load leading to demotiavation
Delegation
Delegation occurs when a line manager entrusts and empowers a subordinate with authority to successfully complete a particular task, project or role.
Responsability remains with the line manager
Advantages and disadvantages
Dis
Prior training needed
Some workers might not want to do the work of others
Additonal pay
not allways suitable
Adv
motivates employees
Improve quality and speed of decision making
reduce worload
Employees improve skills
Centralised and decentralised structures
Decentralisation
refers to the situation in organizations where decision-making authority is delegated throughout, rather from a central authoritative group
Tends to have a flatter structure
Adv
increased flexibility
improve morale
Increased creativity
Reduced workload
Dis
Harder to keep control
No clear management in hard times
Centralisation
Where decision making is made buy smalll groups of senior managers at the top of the hierarchical structure
Tends to happen in tall organisational structures
Adv
better organisation and control
fast decision making
Dis
Morale is lower
demotivated employees
less creativity
situations where centralisation is better
In companies with low skilled workforce
When it can lead to cost savings
when rapid decision making is required
Types of organisational charts
Flat organisational structure
Few layers of management
Wide span of control
Short chain of command
Typically found in
small businesses
Start ups
Advantages and disadvantages
Adv
better communication
more creativity
Dis
Harder to maintain control
Talll organisational structure
Many layers in its organisational hierarchy
Wide chain of command
Short span of control
Examples include
larger businesses
military
normally more formal and inflexible
Advantages and disadvantages
Adv
Can be more motivational because of promotions
Improved control
Dis
Harder communication
low flexibility and no creativity
Organisation by product, function and region
Product
Structuring a workforce according to the goods or services sold
Better for large businesses with broad product porfolios
Exp
Ford
amazon
Advantages adn disadvantages
Advantages
Specialisation from workers
Heathy internal competition
Improved market responsivenes
Better product quality
Disadvantages
Hard to maintain control
Duplication of work
More decentralised struture
Function
Organising a workforce according ot business function
each department has a different manager and director who is in charge of an assigned functional area
advantages and disadvantages
Adv
Specialised roles
higer productivity
Dis
Isolation by only focusing on their areas of responsability
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Region
Structuring a workforce by different geographical areas
Typically found in
Larger businesses
Multinationals
focus on the needs and wants of specific markets based on location
Each regional office operates indvidually, woth their own policies and values
Advantages and disadvantages
Adv
Allows businesses to adapt to regional norms
Improved customer services
Dis
increased cost and resource duplication
difficult to control
Appropiateness of organizational structures and external factors
An organistion will need to adapt to external factors
Sucesfull businesses will create stuctures and build processes to embrace change
External business enviroments
STEEPEL factors
E
Enviromental
P
Politics
E
Economic
L
Legal
T
Technological
E
Ethical
S
Social
External factors that affct a business
Will create opportunities for businesses that adapt
Advantages and disadvantages
Adv
adapting to a changing market
option to surpass competition
Flexibility within a business
less risk/risk anticipation
Improved customer satisfaction
Dis
Costs money and time
Employee resistance
Operational disrupt