Organization Design - Structure PDF

Structure Hierarchy A hierarchy is a system in a business where employees are ranked due to their status and authority Traditionally those at the top of the hierarchy are more important than those at the bottom Employees during their career will seek to move up the hierarchy to...

Structure Hierarchy A hierarchy is a system in a business where employees are ranked due to their status and authority Traditionally those at the top of the hierarchy are more important than those at the bottom Employees during their career will seek to move up the hierarchy to improve their salary and working conditions Chain of command The chain of command in a business is the flow of information power and authority through the Head organisation teacher Those at the top have more power and authority Head’s Secretary They can delegate tasks to those subordinate to them in the hierarchy Head of Head of Head of (below them) English Business Maths Complaints and status reports flow up the chain, orders flow down the chain. Both need to be handled at the lowest level possible Span of control This is a number An employee that works as a Head of Department in a school may have 6 teachers working for them. Their span of control is therefore 6. This is the number of subordinates that they can delegate to Span of control – the number In a hierarchy it’s the number of people that a manager is responsible for. Think wing span of a bird Where there are small spans of control there will be a tall hierarchy and jobs will be very specialised. A wide span of control will mean a flat hierarchy and employees will be given more responsibility and larger roles Decentralisation and centralisation Decentralisation is where a business divides up the organisation into areas, for example: north, south, east, west or UK, Europe, and Africa. The business will have separate budgets for each area Centralisation is where a business has its organisation of management and administration at one central head office. The business has one central shared Located a couple of miles away from Santa budget Monica State Beach, the automotive-themed HQ, or 'Edquarters', wows with a gravity-defying installation Corvettes that rotate above the reception area. Centralisation Scotland Midlands branch branch Head London Office branch Wales South Coast branch branch Centralisation Less delegation, the Branches follow direction from management at Head Head office, for example they Office will make all the key receive all deliveries of stock decisions Scotland Midlands bought by the Head Office branch branch buying department team All recruitment is carried out at head office, all accounts are made here - Head London all decisions about product Office branch lines, sales, stock are made here Wales South Only small decisions Coast such as rotas and stock branch branch merchandising can be made at branch level, main decisions taken at the top of the hierarchy Decentralisation Europe division Divisions operate without a Head Office African division Decentralisation Authority and power The Europe division are given to the Europe manages its own budget divisions to make division and makes all decisions decisions that affect relevant to Europe that division, important when working in countries with different Decentralisation: cultures Divisions operate without a Head Office Quicker decisions can be made as they do not have to go through a central office for approval, this is The African division holds important in dynamic African own budget and makes all markets e.g. fashion division decisions relevant to Africa