Organisational structures

Internal organisational structure

• identifies relationship between diff employees, departments + decisions

Organisational hierarchy - directors + managers

• vision, leadership, risk

Organisational hierarchy - supervisor

• put vision into practice

• delegation

• interpersonal skills

Organisational hierarchy - operative

do all the work

Job roles - CEO/managing director

• highest ranking person, ultimate authority

• in plc, voted into position by shareholders

Job roles - Directors

• below CEO/MD in hierarchy

• several directors

• in large company, in charge of department of functional area (e.g. financial director)

Job roles - managers + supervisors

• in large company, may be several levels of management in hierarchy

• senior managers directly report into Directors

• managers responsible for significant part of business + performance of employees

Job roles - operatives

• at bottom of hierarchy

• do most work

Job roles - support staff

• assistance

• specialist role (e.g. cleaning, caretaking staff)

Delegation

• senior employee giving some workload to less senior employee

• less senior employee takes no responsibility

Delayering

• if business decreasing in size/aiming to reduce costs, may take out layer of management

Positive of delayering

• may help improve communication within business

• decision making should be quicker/business more flexible

• reduced wage costs - less staff employed

Negatives of delayering

• will reduce promotion opportunities

• employee motivation levels may fall - staff expected to take on more responsibility w possibly no extra pay

• business may get additional costs to train staff in new role

Centralisation

• keeping decision making firmly at top of hierarchy, w most senior management

Positive of centralisation

• easier to implement common policies + practices for business as whole

• decisions taken for benefit of whole business not one department

• consistency amongst branches, better customer experience

Negative of centralisation

• lack of authority down hierarchy may reduce staff motivation

• often more layers in organisation = increased costs

• local/junior managers likely to be closer to customer needs = best decisions for local area may not be taken

Decentralisation

decision making spread out to include more junior managers

Positives of decentralisation

• decisions made closer to customer = likely to reflect their specific needs

• good way of training + developing junior management

• improve staff motivation

Negatives of decentralisation

• decision-making not necessarily looking to long term future direction of business

• more difficult to ensure consistent practices + policies, customers might prefer consistency from location to location

• harder to control costs = business may over-spend

Span of control

number of staff a manager is responsible for

Tall structure

• many layers of management

• long chain of command

• managers have narrow span of control

• relatively small number of subordinates (staff)

Flat structure

• few layers of management

• managers have wide span of control

• more staff

• short chain of command

• commonly used for small businesses

Chain of command

official route by which communication flows up + down organisation

Autocratic (authoritative leaders/dictators)

• good in crisis

• communicate easily

• make quick decisions

• micromanagement

• not very creative

• discourage ideas from others

• discourage growth in employees

Consultative

has all power but asks for opinion of others (participative leadership)

• engages w others, makes them feel included

• can slow down decision making

Democratic

allows everyone to contribute to decision making, usually through voting

• engages w others, share power + include them in decision making

• can slow decision making

• doesn’t take ultimate responsibility for decisions

Laissez-faire

let others make decisions for them

• make others feel empowered/motivated to make decisions + solve their own problems

• can lead to confusion about who’s in charge/responsible

• can lead to mixed messages