organisational structure
Learning Objectives:
|
Specification:
|
What is an organisational structure?
It shows how RESPONSIBILITIES in a business are DIVIDED up amongst different departments and people. It shows people INSIDE and OUTSIDE of the business the different job roles for all employees. It shows who is RESPONSIBLE for whom.
It shows how RESPONSIBILITIES in a business are DIVIDED up amongst different departments and people. It shows people INSIDE and OUTSIDE of the business the different job roles for all employees. It shows who is RESPONSIBLE for whom.
Key term: ORGANISATION - the way in which a business is structured for it to achieve its objectives.
Key term: ORGANISATION CHART - a diagram which shows the internal structure of an organisation.
Key term: ORGANISATION CHART - a diagram which shows the internal structure of an organisation.
A business needs to organise its organisation structure effectively. For example, if a business manufactures products but also sells them as well, it would have their structure divided into two different divisions. This allows them to recruit the correct staff to be specialised in each particular division. It also increases accountability as each worker will know what they are directly responsible for. It gives the management and workers of each division or subsidiary an incentive to perform better. It also allows directors to identify which areas of the business are performing well and which need to improve. Some businesses will organise themselves based upon which region they are in. E.g. Europe or America.
- What are the spans of control (number of employees managed by a manager) here?
- What are the levels of hierarchy/layers of management here?
- What do you think a chain of command is?
Key term: HIERARCHY - structure of different levels of authority in a business organisation, one on top of the other.
Key term: SPAN OF CONTROL - the number of people who report directly to another worker in an organisation.
Key term: CHAIN OF COMMAND - the path down which orders are passed. In a company, this goes from the board of directors down to other workers in the organisation.
Why do we need organisational structures?
- Helps to bring order to the business
- Helps new employees
- Helps people outside of the business
- Can improve customer service
- Can aid expansion
Key term: LINE MANAGER - employee who is responsible for overseeing the work of others further down the hierarchy of an organisation.
Key term: FUNCTION - tasks or jobs. Organisation by function means that a business is organised according to tasks that have to be completed, sych as production or finance.
Key term: AUTHORITY - the right to decide what to do in a situation and take command of it to be able to make decisions without referring it to anyone else.
Key term: SUBORDINATE - workers in the hierarchy who work under the control of a more senior worker.
4.1_organisational_structure_activity.docx | |
File Size: | 125 kb |
File Type: | docx |
Extension:
Learning Objectives:
|
Specification:
|
4.1_organisational_structure_starter_activity.docx | |
File Size: | 36 kb |
File Type: | docx |
organisational_structure_pack.docx | |
File Size: | 743 kb |
File Type: | docx |
Activity: Whisper game.
The length of a chain of command varies between businesses. Think about the difference between a local hairdressers compared to a business like HSBC. The longer the chain of command, the more difficulties a business can face:
- messages can get lost up and down the chain of command
- managing change can become difficult, especially if lot of people resist it
- can demotivate workers if they feel they are not part of the business
- can create a 'tribe mentality' where each layer focuses on its own affairs and not the whole business
Key term: DELAYERING - removing layers of management and workers in a hierarchy so that there are fewer workers in the chain of command.
This is more likely to lead to workers working in groups, teams or cells, and being given more responsibilities.
Key term: EMPOWERMENT - giving more responsibility to workers further down the chain of command in a hierarchy.
The empowerment of workers can motivate them, but it will require more training and generally higher pay. It should however, lead to them becoming more productive as fewer workers are needed meaning the business can downsize. This can however, demotivate workers if they believe it is just a cost-cutting exercise.
Key term: DOWNSIZING - when a business employs fewer workers to produce the same amount through increases in productivity which can be achieved through delayering.
When thinking about the organisational structure of a business, the span of control must be considered.
- the more complex the supervision task, the smaller the span of control
- the span of control has to be small if it takes a lot of time to communicate with subordinates
- the better the supervisor, the more people they can supervise
- the more supervisors delegate their work, the greater can be the span of control. Delegation frees up a supervisor's time to supervise the work of more workers. It can also empower subordinates
Key term: DELEGATION - passing down of authority for work to another worker further down the hierarchy of the organisation.
Key term: CENTRALISATION - a type of business organisation where decisions are made at the centre or core of the organisation and then passed down the chain of command.
Key term: DECENTRALISATION - a type of business organisation where decision-making is pushed down the hierarchy and away from the centre of the organisation.
Key term: DECENTRALISATION - a type of business organisation where decision-making is pushed down the hierarchy and away from the centre of the organisation.
Advantages of centralisation:
Disadvantages of centralisation:
|
Advantages of decentralisation:
Disadvantages of decentralisation:
|