3.18 competitive organisational structures
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3.18 Competitive 3.18 Competitive organisational organisational
structuresstructures
Learning objectives
identify and explain different
organisational structures
explain how larger
businesses can adapt
organisational structures
evaluate the effectiveness of
adapting organisational
structures
What is an organisational What is an organisational structure?structure?
DefinitionThe relationship between
different people and functions in an organisation
– both vertically and horizontally
DefinitionThe relationship between
different people and functions in an organisation
– both vertically and horizontally
Recap your understanding of organisational structures by: listing the different types of organisational structures briefly explaining the key characteristics of each type of
structure
Task 1Task 1
Each pair will have a case study of organisational structure to read
Using the case study, feedback to the rest of the group by: briefly summarising the nature of the business identifying the organisational structure of the business explaining why this organisational structure is
appropriate for the business and the disadvantages of alternative structures
explaining why its organisational structure might impact on the business’ competitiveness and / or support the business aims and objectives
Task 2Task 2
Impact on competitiveness
Speed of strategic decision-making
Speed of strategic decision-making
Impact of layers of
management on costs
Impact of layers of
management on costs
Effectiveness of channels
of communicati
on
Effectiveness of channels
of communicati
on
Involvement of ‘right’ people in decision-making
Involvement of ‘right’ people in decision-making
In your table groups, read the case study on Wesley Hains’ card design business.
In your table groups identify some of the influences on organisational structures by discussing the task at the end of the case study
Task 3Task 3
In your table groups, read the case study on the Future Network plc
In your table groups identify how the organisational structure of the business has been changed and suggest pros and cons of the changes
Task 4Task 4
Adapting to improve competitiveness (1)
CentralisationWhere decision-making authority is
concentrated in the hands of a small number of senior managers at the top / centre of the
organisation
CentralisationWhere decision-making authority is
concentrated in the hands of a small number of senior managers at the top / centre of the
organisation
DecentralisationWhere the decision-making authority is
delegated to subordinates in the organisational structure
DecentralisationWhere the decision-making authority is
delegated to subordinates in the organisational structure
Centralisation: advantages
More control for senior
managersmore experienced
and skilled in decision-making
More control for senior
managersmore experienced
and skilled in decision-making
Decisions made for business as
a wholebetter allocation of
funds between departments
Decisions made for business as
a wholebetter allocation of
funds between departments
Strong leadership
Strong leadership
Standardised procedures
leads to economies of scale esp in
purchasing
Standardised procedures
leads to economies of scale esp in
purchasing
Decentralisation: advantages
Frees time for senior
managers
Frees time for senior
managers
Decisions made by those
closest to the issue
Decisions made by those
closest to the issue
Empowers and motivates workers
Empowers and motivates workers
Greater flexibility and
quicker response to
change
Greater flexibility and
quicker response to
change
Develops middle and
junior management
Develops middle and
junior management
Adapting to improve competitiveness (2)
DelayeringThe process of removing levels in the
hierarchical structure in order to create a leaner and more efficient organisations
DelayeringThe process of removing levels in the
hierarchical structure in order to create a leaner and more efficient organisations
Delayering: advantages
Reduction in indirect costs
through reduction in number of
permanent, full time staff
Reduction in indirect costs
through reduction in number of
permanent, full time staff
Better able to respond to changing market conditions
through delegation, better understanding of customer needs and
generation of ideas
Better able to respond to changing market conditions
through delegation, better understanding of customer needs and
generation of ideas
Improved motivation
through greater responsibility
Improved motivation
through greater responsibility
Delayering: disadvantages
Lower motivation
through reduced job security
Lower motivation
through reduced job security
Increased workload of managers
through increased span of control, possible increase in stress and absenteeism, greater need for
training adding to costs
Increased workload of managers
through increased span of control, possible increase in stress and absenteeism, greater need for
training adding to costs
Loss of valuable
knowledge and
experience
Loss of valuable
knowledge and
experience
Adapting to improve competitiveness (3)
Flexible workforcesIntroduction of core and peripheral workers,
outsourcing and homeworking
Flexible workforcesIntroduction of core and peripheral workers,
outsourcing and homeworking
In pairs, investigate the nature of one of the aspects of flexible workforces using textbooks and online resources Core and peripheral workers Outsourcing Homeworking
Produce a poster or factsheet or PowerPoint presentation which Outlines the nature of approach The advantages and disadvantages of the
approach A case study of the approach
Task 5Task 5