18 Questions
What is the main characteristic of a matrix organizational structure?
Employees report to both a product manager and a functional manager
What is a disadvantage of de-layering in an organizational structure?
Decreased flexibility and responsiveness
What is the primary purpose of de-layering in an organization?
To increase efficiency by reducing bureaucracy
In terms of decision-making authority, what distinguishes a centralized organizational structure?
All key decisions are made at the top of the hierarchy
What differentiates a line manager from a staff manager in an organizational setting?
Line managers oversee day-to-day operations, while staff managers handle long-term planning
What is the distinguishing feature of a decentralized organizational structure?
Authority is distributed across various levels of the organization
What characterizes a line manager in an organization?
The person with the authority to make decisions and be held accountable for the outcomes
Which statement best describes the concept of centralization in organizations?
Concentrating decision-making in a single authority, typically senior management
What could be a potential drawback of implementing de-layering in an organization?
Problems arising from extensive spans of control
What is one of the main purposes of de-layering in an organization?
To reduce costs and bureaucracy
In an organizational context, what does decentralization refer to?
Distributing decision-making among various organizational levels
Which type of organizational structure focuses on organizing by products or services offered?
By product
What is the primary disadvantage of de-layering in organizational structures?
Reduced communication between upper and lower management
In organizational structures, what is the main purpose of de-layering?
To flatten the hierarchy
What is a key characteristic of a line manager in an organization?
Directly oversees employees' work
When a company is centralized, decision-making authority is primarily held by:
Top management at the headquarters
What distinguishes a staff manager from a line manager within an organization?
Staff managers are not involved in operational activities.
In the context of centralization and decentralization, which of the following best describes decentralization?
Empowering lower-level employees with decision-making authority
Study Notes
Organizational Structures
- Matrix structure combines two types of organizational structures, generally by product and by function.
- In a matrix structure, each product has a team of employees, and the product manager gets input and approval from functional managers.
- Employees have multiple superiors, reporting to both product manager and functional manager.
Business Organizational Chart
- The business has four levels of hierarchy.
- The managing director has a span of control of four.
- Each functional director controls a supervisory team and has a span of control of two functional supervisors.
- Functional supervisors are responsible for each function and have a span of control of five members in their staff.
Business Structure
- The business has a flat or horizontal organizational structure due to only four levels of hierarchy and a short chain of command.
- It is structured by function, with four clear functional areas, each having a director who reports directly to the managing director.
Types of Managers
- A line manager has authority to make decisions and bears responsibility for the outcomes.
- A staff manager communicates decisions made by a line manager without responsibility for those decisions.
Centralization and Decentralization
- Centralization is the concentration of decision-making in a single authority, usually senior management.
- Decentralization is when decision-making is distributed among different levels of an organization.
De-layering
- De-layering is the removal of levels of hierarchy from an organization's structure.
- Its main purposes are: reorganizing the organizational structure, downsizing, reducing bureaucracy, reducing costs, improving communication, and improving efficiency.
- A possible disadvantage of de-layering is that it can lead to problems associated with wide spans of control.
Organizational Structures
- Types of organizational structures include: by hierarchy, by function, by product, by region, and matrix.
Matrix Structure Features
- Span of control ranges between two (each functional director) and five (each functional supervisor).
Project-Based and Shamrock Organizations
- A project-based organization is a type of organizational structure.
- A Shamrock organization is a type of organizational structure that distinguishes between core, contracted out, and peripheral functions.
Factors Influencing Organizational Structure
- Factors that influence the decision about the structure of an organization include: type of organization, business objectives, potential growth, nature of the market, and external factors.
Appropriate Organizational Structure
- The most appropriate structure for a business is that which best helps it achieve its objectives.
Test your knowledge on organizational structures and matrix management by taking this quiz. Understand how different types of hierarchy, function, product, and region come together in a matrix organization. Practice drawing organizational charts to represent complex business structures.
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