Organisational Design Flashcards

Flashcards covering key vocabulary related to organisational design, including hierarchy, chain of command, span of control, and different organisational structures (centralised, decentralised, tall, flat, matrix).

Organisational Design

A diagram or chart which shows the lines of authority and layers in the hierarchy of the business.

Hierarchy

A system in a business where employees are ranked due to their status and authority.

Chain of Command

The flow of information power and authority through the organisation. Those at the top have more power and authority.

Span of Control

In a hierarchy, it’s the number of people that an employee is responsible for.

Centralised Organisational Structure

Head office makes all the decisions; budgets are kept at head office; only small decisions are made at branch level; recruitment carried out at head office.

Decentralised Organisational Structure

Authority and power to make decisions are given to the branches; budgets are held and spent at branch level; recruitment carried out at branch level.

Tall Organisational Structure

Many layers, long chains of command, narrow spans of control, authority to delegate to subordinates.

Flat Organisational Structure

Wide span of control, short chains of command, fast decision making.

Matrix Organisational Structure

Suitable for a business which is running several projects at once; employees report to their own department managers and also project managers.