Business Organisational Structures Flashcards

Comprehensive vocabulary flashcards covering the different organisational structures, elements of structure, and types of authority found in the business environment.

Organisation by function

The most common way businesses are organised, where employees work with others in the same functional area, such as a sales department.

Organisation by product or service

A structure where employees work with others who produce a particular product or service, common in organisations making a range of different items.

Organisation by geographical location

A structure common in the tertiary sector and international businesses where services and employees are located close to the customer.

Hierarchical structure

The organisation of job roles by rank.

Flat structure

A business hierarchy with few levels of status.

Tall structure

A business hierarchy with many levels of status.

Centralised structure

A business structure in which decisions are made by those at head office or at the top of the hierarchy.

Decentralised structure

A business structure in which decisions are made in branch or lower down in the hierarchy.

Matrix structure

A flexible, non-fixed structure in which teams of people from different functional areas work together on specific projects.

Division of work

The process where tasks a business needs to do are shared out across the workforce, often based on functional areas.

Span of control

The number of employees an employee or manager is directly responsible for.

Narrow span of control

When a manager is directly responsible for only a few employees.

Wide span of control

When a manager is directly responsible for many employees.

Chain of command

The formal hierarchy of a business that prescribes who is in charge of whom and whose permission must be obtained.

Communication paths

The way commands (flowing downwards) and reports (flowing upwards) travel along the chain of command.

Responsibility

The particular task or set of tasks an employee must ensure is completed to an appropriate standard; this cannot be delegated.

Authority

The power accompanying a job role, such as the right to give orders or use resources, which can be delegated to subordinates.

Accountability

The requirement to be answerable for the quality and quantity of work done or not done.

Delegation

The passing down of the authority to do a task to an employee of lower rank.

Empowerment

Enabling workers to make their own decisions and work autonomously without having to refer decisions to their superior.

Organisation chart

A visual representation of the organisational structure of a business, showing hierarchy, spans of control, and division of work.

Command status

The downwards flow of the chain of command which relates to who a particular employee can give orders to.

Reporting status

The upwards flow of the chain of command which relates to who a particular employee must report to and obey.

Superior

A person in the organisation who is higher in status.

Subordinate

A person in the organisation who is lower in status.

Status level

The relative rank of a specific job role, represented by horizontal levels on an organisation chart.