Organisational Structure in Business
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Questions and Answers

What is the outcome of the organising process?

  • Coordination
  • Planning
  • Management
  • Organisation structure (correct)
  • Why is it necessary for an organisation to change its structure?

  • To maintain a stagnant organisation
  • To increase the number of employees
  • To face environmental changes (correct)
  • To reduce the size of the organisation
  • What is the result of an ineffective organisation structure according to Peter Drucker?

  • Increased business performance
  • Improved employee morale
  • Increased profitability
  • Seriously impaired business performance (correct)
  • What is specified by the organisation structure?

    <p>The relationships between people, work and resources</p> Signup and view all the answers

    What is the purpose of an organisation chart?

    <p>To display the organisation structure</p> Signup and view all the answers

    What determines the levels of management in the organisation structure?

    <p>The span of management</p> Signup and view all the answers

    Why is a proper organisation structure essential for a business enterprise?

    <p>To ensure a smooth flow of communication and better control</p> Signup and view all the answers

    What happens to companies that do not change their organisation structure at all?

    <p>They close down or cease to grow</p> Signup and view all the answers

    An effective organisation structure will result in increased ______ of the enterprise.

    <p>profitability</p> Signup and view all the answers

    As an organisation grows, ______ becomes difficult due to the emergence of new functions and increase in structural hierarchies.

    <p>coordination</p> Signup and view all the answers

    The organisation structure can be defined as the ______ within which managerial and operating tasks are performed.

    <p>framework</p> Signup and view all the answers

    The ______ of management, to a large extent, gives shape to the organisational structure.

    <p>span</p> Signup and view all the answers

    An organisation structure allows ______ and coordination among human, physical and financial resources.

    <p>correlation</p> Signup and view all the answers

    A proper organisation structure is essential to ensure a smooth ______ of communication.

    <p>flow</p> Signup and view all the answers

    The organisation structure of a firm is shown in an ______ chart.

    <p>organisation</p> Signup and view all the answers

    An organisation that does not focus on growth can maintain a particular structure for a long ______ of time.

    <p>period</p> Signup and view all the answers

    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.

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    Description

    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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