Organisation and
management
• Organisational structure: the formal, internal
framework of a business that shows how it is managed
and organized
• Functional departments: the main activities of
business: finance, marketing, operations, humand
resources, research and development
Advantages
• All employees are aware of which communication channel is used to
reach them with messages
• Everyone knows their position in the business. They know who they are
accountable to and who they are accountable for
• It shows the links and relationship between the different departments
• Gives everyone a sense of belonging as they appear on the organizational
chart
Key Terms
• Levels of hierarchy
• Chain of command
• Span of control
Levels of
hierarchy are the
number of levels in
an organizational
structure
Chain of command is the route through which authority is passed
down.
Span of control: is the number of subordinates working directly
under a manager in the organizational structure.
>> WIDE:
- less expensive as there are fewer managers
- Less supervision and + employee motivation
- faster communication
>> NARROW:
- more promotion opportunities
- More control over subordinate’s tasks
- effective communication is slower
Complete this chart with information from pages 93
and 94
TALL FLAT
Levels of hierarchy
Number of
managers
Span of control
Chain of command
Communication and
decision making
Tall or flat?
Tall organisations Flat organisations
• Many levels of hierarchy • Few levels of hierarchy
• More managers, narrow • Fewer managers, wide
span of control span of control
• Long chain of command • Short chain of command
• Slower communication and • Quicker communication
decision making and decision making
Delayering is reducing the size of the hierarchy by removing one or
more levels – most often middle management
Advantages Disadvantages
• Reduces costs • Increased workload for
managers
• Quicker communication
• Redundancy payments
• Opportunities for • Fear of redundancy, less job
delegation security
• Closer touch with what is • Wider span of control might
happening in the business reduce effective management
Centralised or decentralised?
Centralised Decentralised
• Important decisions at • Important decisions on
head office lower levels
The wider the span of control the shorter the
chain of command
Advantages of a short chain of
command
• Communication is quicker and more accurate
• Top managers are less remote from lower employees
• As span of control maybe wider, encourage managers to delegate
responsibility
• Line Managers have authority over people directly below them in the
organizational structure. Traditional marketing/operations/sales managers are
good examples.
• Staff Managers are specialists who provide support, information and
assistance to line managers. The IT department manager in most
organisations act as staff managers
Planning
Controllin Organisin
g g
Functions
of
managem
ent
Cordinatin Command
g ing
What is Delegation?
is giving a subordinate the authority to
perform some tasks.
Advantages to managers Advantages to
• managers cannot do all work by subordinates
themselves • the work becomes more interesting
and rewarding- increased job
• managers can measure the satisfaction
efficiency and effectiveness of their • employees feel more important and
subordinates’ work feel trusted– increasing loyalty to
firm
• can act as a method of training and
opportunities for promotions, if they
do a good job.
Leadership Styles: different approaches used
when dealing with people when in a position of authority.
• ACTIVITY
Sam’s Fruit is a large company selling juice drinks around the world. The company is
controlled by a managing director. There are four departments: purchasing, finance, sales
and human resources. Each department has a manager who is responsible for a number
of employees. The purchasing manager is in charge of two employees, finance has five
employees, sales has four employees and human resources has three employees.
1 Draw an organisational chart to show how Sam’s Fruit’s business is arranged.
2 How many levels are there in this business’s hierarchy?
3 For each manager, state what their span of control is.
4 Would you say the managers have a wide or a narrow span of control? What are the
benefits of this type of span of control?
5 Explain the possible benefits for this company of having a clear organisational
structure.
Trade Unions: group of workers who have joined
together to ensure their interest are protected.
• A advantage is there is
more freedom with
this leadership style.
Which leaves room for
more creativity and
brainstorming
Ad 1: Limited Liability
Explanation: Any of BGN's debts will now be responsibility of the business
and the owners will have their personal belongings secure.
Ad 2: Secured from business take over
Explanation: As BGN is a private limited company, its shares are not open to
public so there is less risk of shareholders taking over the business.
They could encourage sharing of ideas and networking,
so that everyone's ideas are heard and questions. Make
the business objectives and goals clear to everyone, so
there is no miscommunication and lack of customer
service. I think sharing ideas would be the best option as
this would help come up with ideas to prevent customer
complaints in the future.
Make the Mission and Vision Clear. BGN can take time to
explain the company values and [Link]
employees are unified in their understanding of the
company goals, they will be able to communicate with
one another more effectively in order to reach them.Â
They can also encourage the staff for infromation
sharing. This will provide an online platform for the
knowledge sharing about the beds and furniture. This
could mean, that when they read news information
Way 1: Send emails related to there business. Having an opportunity to show
everyone what you know about or learnt about it, it will
Way 2: They can have meetings instead of monthly
motivated the other workers to know about it too.
reports.
BGN can change the channel of communication.
A weekly meeting in person or by zoom, allows for
personal interaction and the manager can receive
feedback from the receiver to see if they have
understood.
Sending emails, is a form of keeping details on record,
allowing employees to check them more than once, so
don't commit an error.
For BNG, a sending emails with detailed information may
be the best option, as they are located in different cities,
making it difficult for some employees to get to the
meeting location.
Advantage 1: They can call workers in whenever
they need them, for example: on holidays
Advantage 2: Attracts workers that need flexible
and easy working hours.
Â
• Method 1: Job rotation
Ex: Rotate jobs so they don't get bored of the
same job and they learn new things.
Method 2: Job enrichment and enlargement
Ex: Give them better jobs and larger jobs to
keep them learning and interested in there
work
