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Organisation - Why?
In order for a business to survive and grow it must
Be organised
Organisation Charts
These are used to show the structure of a Business (see next slide)
Organisation Chart
Managing Director
Sales Director
Finance Director
Personnel Director
Purchases Director
Sales Manager
Marketing Manager
Accountant
Recruitment Manager
Purchases Manager
Organisation Chart
Athens 2004
Employee Names Job Titles Room Numbers Groupings within the organisation Photographs Telephone Numbers
Disadvantages
Information can soon be out of date ie people leave
Employees can see an overall picture of the organisation The position of employees within the organisation Lines of communication flowing up and down the organisation Lines of authority managing director to departmental manager Lines of responsibility sales director in charge of the the work of the sales manager
Levels of Responsibility
High
Senior Manager Middle Manager Junior Manager Supervisors, Senior Assistants
Low
Responsibility
The obligation an employee has to carry out a range of tasks or duties Duties may include supervising other people
Lines of Responsibility
Sales Director Sales Manager
Marketing Manager
These show people in the organisation who oversee the work of other members of staff In the example, the Sales Director is in charge of the work carried out by the Sales Manager and Marketing Manager
Lines of Communication
Board of Directors
Managing Director
Organisations must communicate information efficiently Information must flow up and down the organisation
Sales Director
Sales Manager
Authority
The power that an employee has to instruct others and take decisions eg an Administration Manager would have authority over an Administration Supervisor
Lines of Authority
These show who is allowed to give instructions and who will receive them In the example, the Personnel Manager reports to the Personnel Director. The Personnel Director gives instructions to the Personnel Manager
Personnel Director
Personnel Manager
Span of Control
The number of staff who report directly to the manager A manager with a wide Span of Control will have many staff reporting directly to him/her A manager with a narrow Span of Control will have few staff reporting directly to him/her
Accountability
The obligation that an employee has to justify or explain his/her actions or decisions An employee is accountable to his/her line manager
Chain of Command
Each grade or level gets its instructions from the one above and passes them on to the one below - this is called the CHAIN OF COMMAND
Delegate
Pass on to selected employees the authority and responsibility to carry out a task or activity
Posts with the same status or authority are grouped together and shown on the same level Posts with the more authority are shown above Posts with less authority are shown below
Tall Organisation
Tall Organisation
Features
Examples
More levels of management There are many lines of communication Tends to be seen in longer-established organisations
Tall Organisation
Advantages
Disadvantages
Easier to supervise Staff Promotion opportunities Likely to know immediate boss well
Feel undervalued removed from decision making Decision-making slow Communication takes time Costly management structure
Flat Organisation
Flat Organisation
Features
Examples
Fewer levels of management There are fewer lines of communication Tends to be seen in more modern organisations
Flat Organisation
Advantages
Disadvantages
Motivated with more authority and responsibility Able to show initiative Involved in key decisionmaking Less time to reach decisions and take action Less time taken to communicate decisions
Workloads likely to increase stress May need more training wider range responsibilities Feeling of being isolated with a wide Span of Control Fewer promotion opportunities
Line Relationships
Chief Executive Finance Director Finacial Accountant Sales Director Personnel Director
Line relationships in an organisation show those employees who are in charge of the work of other members of staff
Line Relationships
Chief Executive This section of chart shows the following line relationships Finance Director Chief Executive Finance Director Finance Director Cost Cost Accountant Accountant Cost Accountant Senior Accounts Senior Accounts Assistant Assistant Senior Accounts Assistant Accounts Line Accounts Assistant Assistant Relationship
Lateral Relationships
The Chief Executive is directly responsible for 3 members of staff The lateral relationship exists between the Finance Director, Marketing Director and Human Resources Director All have the same level of responsibility
Chief Executive
Finance Director
Marketing Director
Lateral Relationship
Organisation Restructuring
Organisations often change their structure to improve their efficiency or due to business expansion or contraction This can involve relocating to different offices It could also involve staff redundancies
Restructuring
Possible benefits To reduce costs To become more efficient To delegate tasks to other departments To contract-out key activities eg cleaning To improve communications within the organisation Possible problems Low staff morale Staff may not want the change Cost of restructuring new departments Initial communication problems who is in charge of who Customers may be unfamiliar with the new structure
Methods of Restructuring
Growth more staff at all levels, new departments, possibly more levels of management Downsizing reduces staff not output, redundancies, fewer posts at all levels of management, main departments remain
Methods of Restructuring
Delayering removing levels of management, wider Span of Control, increased responsibilities for staff Outsourcing buying in services eg IT Support, allows focus on core activities, fewer departments
Features of Teams
Shared Common Goal or Purpose Commitment to achieving Goal Team Planning and Discussion Members help each other praise and encouragement Each member takes some responsibility for success/failure Best use of team member skills Help come up