2.2 Organisational Structures

• Delegation is the passing on and entrusting of certain tasks from managers to subordinates. It allows managers to focus on strategic decisions while empowering employees with meaningful work.
• Span of control is the number of subordinates (employees) who are directly accountable to a manager.
• Organisational structures can be flat/horizontal, tall/vertical, by product, by region, or by function.
• Matrix structures are flexible and unique to each particular situation.
• Hierarchical structures are clear and easy to understand and they create a sense of belonging because people easily understand their place in the hierarchy and can see who they work with, who they are accountable to and who they are responsible for.
• Accountability is a down-to-top (upwards) type of professional relationship which means being responsible to someone on the higher level of the hierarchy.
• Organisations can structure their departments based on their needs however they want, even though they usually have departments that are in charge of the main business functions.
• Professional relations refer to the boss, manager, colleagues, departments, and how they cooperate.
• Organisation chart is a graph that represents organisational structure by showing the relationships of accountability and responsibility.
• Hierarchical structures might result in certain isolation between departments (and “us and them” culture, again) and they are quite inflexible because people tend to only do work that’s strictly determined by the hierarchy.
• Project-based organisation is a characteristic of an organisation that works on “one-of-a-kind” activities (projects) and has a new team for each project.
• Project-based organisation is a type of organisational structure that has human resources organised around projects, as opposed to the hierarchy or purpose or other factors.
• Chain of command is a system by which orders and instructions are passed down in an organisation.
• Centralised organisations usually make quick decisions, have a good sense of direction among staff, are easier to control and are efficient in critical situations.
• Organisational structures (especially in creative industries) tend to get flatter and wider, with more delegation, wider spans of control, less levels of hierarchy, shorter chains of command and tend to become less bureaucratic and more decentralised.
• Centralisation adds pressure/stress for senior management (because all decisions are on them and they are in charge of everything), it is inflexible, power plays are common and decision-making can be demotivating for some people because there is no reward for initiative.
• Bureaucratic organisations are inflexible and hinder creativity and risk-taking because people are reluctant to do all things if there are too many rules and if you need a permission for everything you do.
• Decentralisation is the transfer of power and decision-making from a single authority to several people/groups.
• Delegation is the passing on and entrusting of certain tasks from managers to subordinates.
• Hierarchy is an organisational system that is based on ranking. Levels of hierarchy are different layers in a hierarchical structure. Line manager is a person directly above an employee on the next hierarchical level. There can be many line managers on different levels. Line managers are essential to hierarchical structures.
• Chain of command is a system by which orders and instructions are passed down in an organisation. The more levels of hierarchy there are, the longer the chain of command is. Thus, chain of command can be long or short. Longer chains usually indicate narrow spans of control and their features, while shorter chains of command indicate wider spans of control and the corresponding features.
• Bureaucracy is the execution of tasks that are guided by excessively complicated administrative rules and procedures. Simply speaking, it refers to too many rules and procedures and paperwork in an organisation.
• Adhocracy is the opposite of bureaucracy but it does not mean that bureaucracy is bad and adhocracy is good. Balance between the two is what leads to success.
• Centralisation is the concentration of power and decision-making in a single authority (one person or group of people). Centralised organisations usually make quick decisions, have a good sense of direction among staff, are easier to control and are efficient in critical situations. However, they add pressure/stress for senior management
• Delayering is the process of removing one or more levels in the hierarchy. Delayering implies removal of management, not necessarily removal of people
• Advantages of delayering: it reduces admin costs, improves the speed of communication, encourages delegation and empowerment.
• Delayering might create anxiety and sense of insecurity, overload staff and prolong decision-making
• Matrix structure is a system whereby employees report to several managers and work in cross-departmental teams.
• Organisational structure is an arrangement of professional relations at work.
• Organisation chart is a graph that represents organisational structure by showing the relationships of accountability and responsibility.
• Responsibility is a top-down (downwards) type of professional relationship which means being in charge of someone on the lower levels of the hierarchy.
• Chart by product indicates all the products that an organisation is providing.
• Chart by function is the most traditional kind of chart that indicates the functional departments in the organisation: marketing, HR, finance and accounts, operations
• Shamrock organisation is a type of organisational structure that divides the workforce into three “leafs” depending on how essential they are to the organisation: Core staff — full-time professional workers, Outsourced (contractual) staff are subcontractors that perform some non-core activities, Outsourced (contractual) staff are subcontractors that perform some non-core activities