2.2 Notes

Vocabulary flashcards covering key terms for organizational structures, hierarchical models, and Charles Handy’s Shamrock Organization.

Delegation

The passing on of control and authority to others, where a line manager entrusts and empowers staff to complete a task while holding them accountable.

Span of control

The number of subordinates who are directly accountable to a manager.

Chain of Command

The formal line of authority through which orders are passed and accountability/responsibility is shown.

Centralization

An organizational structure where decisions are made through a small number of people or executives with little communication to other members.

Decentralization

An organizational structure involving delegation where decision-making power is shared with more members of the organization.

Tall Structure

An organization with many layers within the hierarchy and a narrower span of control per manager.

Flat Structure

An organization with fewer levels of hierarchy and a wider span of control per manager.

Delayering

The process of removing one or more levels in the hierarchy to flatten the structure, often to reduce costs and widen the span of control.

Matrix Structure

A temporary structure where employees from different departments come together to work on a specific project, often reporting to two managers.

Shamrock Organization

Charles Handy’s model suggesting businesses should be composed of three core groups: Core Staff, Contractual Fringe, and Flexible Workforce.

Core Staff

Under Handy’s model, these are full-time professional workers crucial to the organization who are becoming a smaller group over time.

Contractual Fringe

Under Handy’s model, these are outsourced or subcontracted specialists who handle non-essential work.

Flexible Workforce

Under Handy’s model, these are part-time, temporary, or seasonal workers used to help a business be more flexible.

Organizational Chart

A diagrammatic representation of a firm’s formal structure, showing functional departments, chain of command, span of control, and official communication channels.

Organization by Function

Structuring an organization based on specialized departments such as Marketing, Production, Finance, and HR.

Organization by Product

Structuring an organization based on the specific goods or services it produces, such as Consumer Products versus Industrial Products.

Organization by Region

Structuring an organization based on geographical locations, such as Singapore or Vietnam operations.

Downsizing

The reduction in the size of a company’s workforce, often associated with delayering to reduce costs.