1.4.3 Organisational Design

• Span of control - The number of subordinates a manager directly is responsible for.
• chain of command - the number of "layers" of authority in an organization, from the top to the bottom
• Tall structure - long chain of command , short span of control

  • maintain control - subordinates are closely monitored
  • motivating - more chances of promotion for employees
  • communication can be difficult
  • can take a long time to make decisions
• Flat structure - short chain of command , wide span of control

  • information can be passed down quickly
  • more autonomy given to employees
  • fewer layers - less chance of promotion
• delegation - the process of giving authority to a subordinate to carry out a task while manages retain responsibility for the task

  • can help spread work load
  • motivating - gives some responsibility to subordinates
  • managers may over work subordinates
  • may not be as high a quality as it could be
• Appropriateness of structures:

  • skills of the work force - to give them more or less autonomy
  • management style used - how much a higher up can intervene to help/guide subordinates
  • competitive environment - if in a competitive environment could the opportunity cost go somewhere else