16 Questions
What is the outcome of the organising process?
Organisation structure
Why is it necessary for an organisation to change its structure?
To face environmental changes
What is the result of an ineffective organisation structure according to Peter Drucker?
Seriously impaired business performance
What is specified by the organisation structure?
The relationships between people, work and resources
What is the purpose of an organisation chart?
To display the organisation structure
What determines the levels of management in the organisation structure?
The span of management
Why is a proper organisation structure essential for a business enterprise?
To ensure a smooth flow of communication and better control
What happens to companies that do not change their organisation structure at all?
They close down or cease to grow
An effective organisation structure will result in increased ______ of the enterprise.
profitability
As an organisation grows, ______ becomes difficult due to the emergence of new functions and increase in structural hierarchies.
coordination
The organisation structure can be defined as the ______ within which managerial and operating tasks are performed.
framework
The ______ of management, to a large extent, gives shape to the organisational structure.
span
An organisation structure allows ______ and coordination among human, physical and financial resources.
correlation
A proper organisation structure is essential to ensure a smooth ______ of communication.
flow
The organisation structure of a firm is shown in an ______ chart.
organisation
An organisation that does not focus on growth can maintain a particular structure for a long ______ of time.
period
Study Notes
Organisation Structure
- An effective organisation structure increases profitability of an enterprise.
- An organisation needs an adequate structure when it grows in size or complexity.
- Enterprises that do not focus on growth can maintain a particular structure for a long period, but this may lead to stagnancy and ultimately, closure.
Importance of Organisation Structure
- Peter Drucker states that an organisation structure is an indispensable means, and a wrong structure can seriously impair business performance and even destroy it.
- Organisation structure is necessary for a business to function smoothly and face environmental changes.
Definition of Organisation Structure
- Organisation structure is a framework that outlines how managerial and operating tasks are performed, and specifies relationships between people, work, and resources.
- It enables correlation and coordination among human, physical, and financial resources to accomplish desired goals.
Organisation Chart
- An organisation structure is shown in an organisation chart.
- The span of management determines the levels of management in the structure.
Span of Management
- Span of management refers to the number of subordinates that can be effectively managed by a superior.
- It shapes the organisational structure.
Benefits of Organisation Structure
- A proper organisation structure ensures a smooth flow of communication and better control over business operations.
- It provides a framework for the enterprise to function as an integrated unit, regulating and coordinating individual and departmental responsibilities.
Organisation Structure
- An effective organisation structure increases profitability of an enterprise.
- An organisation needs an adequate structure when it grows in size or complexity.
- Enterprises that do not focus on growth can maintain a particular structure for a long period, but this may lead to stagnancy and ultimately, closure.
Importance of Organisation Structure
- Peter Drucker states that an organisation structure is an indispensable means, and a wrong structure can seriously impair business performance and even destroy it.
- Organisation structure is necessary for a business to function smoothly and face environmental changes.
Definition of Organisation Structure
- Organisation structure is a framework that outlines how managerial and operating tasks are performed, and specifies relationships between people, work, and resources.
- It enables correlation and coordination among human, physical, and financial resources to accomplish desired goals.
Organisation Chart
- An organisation structure is shown in an organisation chart.
- The span of management determines the levels of management in the structure.
Span of Management
- Span of management refers to the number of subordinates that can be effectively managed by a superior.
- It shapes the organisational structure.
Benefits of Organisation Structure
- A proper organisation structure ensures a smooth flow of communication and better control over business operations.
- It provides a framework for the enterprise to function as an integrated unit, regulating and coordinating individual and departmental responsibilities.
Understand the importance of organisational structure in a growing enterprise, its impact on profitability, and the consequences of stagnancy. Learn how organisations adapt to size and complexity changes.
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