15 september 2015© easilyinteractive.com 2006-101 organisational structure definitions press f5 on...

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Organisational structure

Definitions

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Learning ObjectivesTo understand the following key terms:

Span of control Hierarchy Chain of command Delegation

To be able to identify the roles responsibilities and inter-relationships between people from an organisational chart

Extension - To be to evaluate advantages and disadvantages of a particular structure



Organisational structuredefinitions (1/2) Hierarchy: The number of levels in an

organisation E.g. School

Chain of command: The way authority and power are passed down in the business - Who is responsible to whom?

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Headteacher

Deputy Heads

Heads of Faculty

Heads of Department

Teaching Staff


Organisational structuredefinitions (2/2)Span of control: The number of

subordinates reporting to a superior

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Tall hierarchyNarrow span of control

Tight supervision and control

Short hierarchyWide span of control

Freedom for subordinatesLower cost



Identify the span of control of: the Managing Director the Purchasing Manager

Would you describe this as a wide or a narrow hierarchy?

ProductionControl

Manager

QualityManager

MarketingManager

Sales Manager

TrainingOfficer

IndustrialRelations

Officer

Buyer Logistics Officer

Warehousemanager

Sales Representatives Wages Clerk

CostAccountant

Purchasing Manager

Production Manager

Finance Manager

Marketing Manager

Personnel Manager

Managing Director

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Organisational structuretaskUse PowerPoint to construct an

organisation chart of the school

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ProductionControl

Manager

QualityManager

Public Relations

Sales Manager

TrainingOfficer

IndustrialRelations

Officer

BuyerTransport

OfficerWarehousemanagerSales Representatives

Wages Clerk

CostAccountant

Purchasing Manager

Production Manager

Finance Manager

Marketing Manager

Personnel Manager

Managing Director

Alternatively use mind-mapping software such as OpenMind by Matchware

Learning Objectives

To understand what an organisational chart is and its purpose

To be able to interpret an organisational chart

To be able to draw an organisational chart from information given

To be able to evaluate how appropriate an organisational chart is in a particular context




Sinbad Plc task

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There are several options for doing this task Print out the task alone (pdf). Students draw their own hierarchy Print out the task with the blank hierarchy (worksheet) for students

to fill in Do the task as an interactive class exercise

This task also serves as an introduction to some of the language and topics that students will be covering later.



Formal and informal structures


Formal and informal structures

The formal structure of the organisation is the official structure Each employee has clear authority and

responsibility with official lines of communication both upwards and downwards

Informal structure is based on friendship groups, sports teams etc.

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Formal and informal structurestask Identify a range of formal

and informal groups that are within your school

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Formal Informal


Organisational structures

Delegation,

centralisation

and decentralisation


Delegation

Delegation: Passing authority (not responsibility) down the hierarchy to subordinates Involves giving junior managers greater

trust and authority The line manager retains responsibility Requires the superior to release control

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Centralisation and decentralisation Centralisation: Retaining control within the

top levels of the hierarchy – at head office Decentralisation: Delegating authority down

the hierarchy

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Centralisation Retains tight control at the

top of the organisation Employees are not able to

show flair and initiative

Decentralisation Motivates employees by

giving them more freedom and responsibility

Employees may not have the experience/training to carry out tasks effectively



Delayering


Delayering

Delayering: The removal of one or more layers of the hierarchy Improves communication – makes it faster

and reduces ‘Chinese Whispers’ Downsizing: Reducing the size of the

business to meet a new, lower level of demand

Organisations delayer to improve efficiency – i.e. in order to produce the same output with fewer inputs

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Delayeringdiscussion task

What are the advantages and disadvantages for a business of delayering?

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Save money in the long run Speed up communication Reduce bureaucracy

Demoralising Overload some workers Confusion during process Extra training costs Redundancy costs



Business structure


Business structure Division by function: The firm is divided up by

the jobs that people do e.g. Marketing, Finances, Production etc.

Division by product: The firm is divided up by product Cadbury’s has a manager responsible for each brand,

who manages a marketing team Geographical division: The firm is divided by

geographical area.

Most multinational companies have a geographical structure on top of one of the other two structures

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Business structuretask What are the advantages and disadvantages for a

business being organised in these three ways?

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By functionGeographically

By product

Advantages

Disadvantages


Managing a Business

15 september 2015© easilyinteractive.com 2006-101 organisational structure definitions press f5 on...

Documents

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organisational structureformal

organisational chart

organisation chart

span of controlhierarchychain

informal groups

range of formal

particular structure