Chapter-19-Organisational-design

Organisational Design Overview

Importance of Structure: Almost all businesses, except the smallest, have an identifiable internal structure.
Factors Influencing Structure:
- Views and Philosophy of Management:
  - Democratic managers promote shared responsibility among workers.
  - Autocratic managers prefer clear hierarchies with defined roles.
- Need for Different Communication Systems:
  - Controlled communication leads to multi-layered structures with narrow spans of control.
  - Open communication allows for less hierarchical and more flexible structures.
- Industry Characteristics:
  - Retail tends to have hierarchical structures.
  - Industries like software development often have shorter chains of command.
- Traditions of the Business:
  - Many businesses start with a traditional pyramid structure and may face resistance when changing it after privatization.
  - New economy businesses might favor less rigid structures.
- Skills of Workforce:
  - A more skilled workforce desires less oversight, leading to flatter structures with delegated decision-making.

Layers of Hierarchy:
- Indicates the management structure and relationships of responsibility (e.g., police force chain from Chief Constable to Constable) with various levels of authority.
Chains of Command:
- The pathways through which decisions and directives flow down the hierarchy (e.g., police commands on policy enforcement).
Levels of Responsibility:
- Each hierarchical layer has distinct responsibilities, influenced by the level of control delegated from above.
Span of Control:
- Refers to the number of subordinates directly managed by a supervisor.
- A wider span indicates greater delegation and trust; a narrower span means tight control.

Traditional Hierarchical Structure:
- Characterized by a tall structure with many layers and narrow spans of control.
- Advantages:
  - Centralized control enables clarity in responsibilities.
  - Clear paths of communication and defined departmental roles.
- Disadvantages:
  - Distances senior management from operational staff, potentially distorting information.
  - Vertical communication issues can lead to outdated instructions.
  - Departmental isolation hampers inter-departmental collaboration.
Flatter Organisational Structure:
- Involves fewer layers, a wider span of control, and a shorter chain of command.
- Advantages:
  - More motivational as authority is delegated.
  - Faster decision-making at operational levels.
  - Quicker and clearer communication.
- Disadvantages:
  - Loss of central control may lead to misaligned departmental objectives.

Overview: Combines various management tasks cutting across departments, fostering collaboration on projects.
- Example: A product development team with members from R&D, Marketing, Production, and Accounts.
Advantages:
- Enables specialized skills across projects, breaking communication barriers.
- Fosters innovation and efficient resource use, improving flexibility.
Disadvantages:
- Dual reporting can cause role ambiguity and decision-making slowdowns.
- High coordination costs due to differing departmental cultures and practices.

Organising by Function: Definition and implications.
Issues with Wide Span of Control: Potential problems that can arise.
Matrix Structure Pros and Cons: Advantages versus disadvantages.
Delayering Thoughts: Evaluating the statement that empowering workers through delayering is more beneficial than costly.
Addressing Hierarchical Limitations: Strategies for enhancing innovation and communication within traditional structures.