1.4.3 Organisational design

Define organisational structure

Outlines the reporting relationships, roles, and responsibilities of employees in the organisation

Define hierarchy

A hierarchy refers to the levels of authority within an organisation

Define chain of command

The formal line of authority that flows down from the top management to lower-level employees - It defines who reports to whom and who is responsible for making decisions

Define span of control

Refers to the number of employees that a manager or supervisor can effectively manage

Define centralised structure

Decision-making authority is concentrated at the top of the organisation, with senior management making most of the decisions

Define decentralised structure

Decision-making authority is distributed throughout the organisation, with lower-level employees having more decision-making power

Define tall structure

Characterised by…

• Multiple levels of management

• Centralised decision making

• Long chain of command

Define flat structure

Characterised by…

• Fewer levels of management

• Decentralised decision-making process

• Short chain of command

Define matrix structure

They combine the functional areas of a business (HR, finance, marketing, sales) with a specialist team that operates inside the business to work on a project together.