Organisational design

• What is a hierarchy in a business?

  A system where employees are ranked
• Why do employees seek to move up the hierarchy?

  To improve salary and working conditions
• What is the chain of command in an organization?

  • Flow of information, power, and authority
  • Those at the top have more power
  • Delegation of tasks to subordinates
• What flows up the chain of command?

  Complaints and status reports
• What flows down the chain of command?

  Orders and tasks
• What is delegation in a business context?

  Assigning tasks to subordinates
• What does centralization mean in a business?

  All major decisions are made at head office
• What is the role of branches in a centralized organization?

  Follow direction from head office
• What is decentralization in a business?

  Divisions make decisions affecting their area
• Why is decentralization important in different cultures?

  It allows divisions to adapt to local needs
• What are the characteristics of a tall organizational structure?

  • Many layers in hierarchy
  • Long chain of command
  • Narrow span of control
  • Opportunities for promotion
• What is the impact of a tall structure on information flow?

  Information takes a long time to travel
• What does a narrow span of control indicate?

  Manager has few subordinates to oversee
• What are the characteristics of a flat organizational structure?

  • Wide span of control
  • Short chain of command
  • Quick information flow
  • Fewer management layers
• What is a matrix structure in a business?

  A structure for multiple projects or products
• What are the benefits of a matrix structure?

  • Coordination between functions
  • Breaks down departmental barriers
  • Encourages teamwork
  • Tighter project control
• What is the impact of organizational structure on a business?

  • Must meet company objectives
  • Authority and accountability must be clear
  • Structure should support strategic goals
  • Decision-making power needs proper placement