Organisation Structure & Employees (Edexcel IGCSE Business): Flashcards
Exam code: 4BS1
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Define organisational structure.
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Cards in this collection (41)
Define organisational structure.
An organisational structure outlines the reporting relationships, roles and responsibilities of employees.
Define hierarchy.
A hierarchy refers to the levels of authority within an organisation, ranked from top to bottom.
Define chain of command.
The chain of command is the formal line of authority flowing downward from top management to lower-level employees.
Define span of control.
Span of control is the number of employees a manager or supervisor directly manages.
A narrow span of control means there are layers of management.
A narrow span of control means there are more layers of management.
What is the difference between a hierarchical and a flat structure?
A hierarchical structure has many levels, a long chain of command and narrow span; a flat structure has few levels, a short chain and wide span.
Give one advantage of a hierarchical structure.
A clear structure of authority, defined roles, and it promotes specialisation.
Give one advantage of a flat structure.
Faster decision-making, and a culture of collaboration and open communication.
True or False?
A flat structure usually has a long chain of command.
False.
A flat structure has a short chain of command and wide span; a hierarchical structure has a long chain.
Define delayering.
Delayering is removing layers from a hierarchy, which shortens the chain of command.
Define a centralised structure.
A centralised structure is where authority for decision-making rests with senior management at the centre.
Define a decentralised structure.
A decentralised structure is where decision-making authority is delegated further down the hierarchy.
Give one advantage of a centralised structure.
Effective co-ordination and control, fast decision-making, and consistency across the organisation.
Give one advantage of a decentralised structure.
Better response to local conditions, more fulfilled and loyal staff, and it prepares junior managers for career development.
A well-designed organisational structure can be shown visually using an organisation .
A well-designed organisational structure can be shown visually using an organisation chart.
True or False?
A centralised structure ignores the insights of lower-level staff who are closest to customers.
True.
A disadvantage of centralisation is that it ignores insights of lower-level staff who are closer to customers.
What does a board of directors do?
Makes key strategic decisions — e.g. new corporate policies, investment, and growth objectives.
What is the role of a senior manager?
To plan to achieve the business's overall goals, set long-term plans and targets, and contribute to strategic decisions.
What is the role of a functional manager?
To run a function (e.g. marketing or finance), achieve targets set by directors, and make operational decisions.
What does a supervisor or team leader do?
Report problems, pass on instructions, and take simple decisions such as allocating jobs.
In a department store, sales assistants and customer service reps are examples of staff.
In a department store, sales assistants and customer service reps are examples of operational staff.
What is the difference between operational and support staff?
Operational staff do the core tasks directed by managers; support staff assist with non-core operations (e.g. cleaners, IT technicians).
Define delegation.
Delegation is giving responsibility for specific tasks to subordinates, usually transferring authority from manager to subordinate.
Give one advantage of delegation for managers.
It lets managers concentrate on important tasks, measure staff performance, and can reduce errors.
Give one advantage of delegation for workers.
Workers feel empowered and motivated, gain training, and find work more interesting and rewarding.
True or False?
Delegation is particularly important in a flat organisational structure.
True.
Delegation is especially important in a flat structure, where managers have wide spans of control.
Some managers are reluctant to delegate because they lose some over decision-making.
Some managers are reluctant to delegate because they lose some control over decision-making.
True or False?
All managers are always happy to delegate authority to their subordinates.
False.
Some managers are reluctant to delegate — e.g. autocratic leaders, or those who feel threatened by skilled subordinates.
Give an example of delegation in a business.
The HR Director of a large company delegates authority for recruitment and training to the Recruitment and Training Manager.
Define a functional area.
A functional area is a group of workers with similar skills who carry out a specific organisational role.
Name the four main functional areas of a business.
Human Resources, Finance, Marketing, and Production.
What is the role of the Human Resources function?
Managing the workforce — recruitment, training, industrial relations, and health and safety compliance.
What is the role of the Finance function?
Managing the organisation's money — recording transactions, paying bills and salaries, setting budgets, and preparing the annual report.
What is the role of the Marketing function?
Understanding customer needs — market research, distribution, pricing, and persuading customers to buy.
What is the role of the Production function?
Creating the product or service — ensuring quality, sourcing raw materials, designing and testing products, and stock management.
Businesses split work into functional areas to improve efficiency, using who work to a high standard.
Businesses split work into functional areas to improve efficiency, using specialists who work to a high standard.
True or False?
Functional areas work independently and never need to cooperate.
False.
Functional areas must work together — e.g. Finance sets the budget that Marketing spends on promotion.
Why might a business outsource a functional area?
To reduce costs and access specialist advice from providers who would be expensive to employ directly.
The function recruits staff and organises induction training for new employees.
The human resources function recruits staff and organises induction training for new employees.
True or False?
The Marketing function researches customer needs, which informs what Production makes.
True.
Marketing research finds customer needs, which informs Production what to make.
How do the Production and Finance functions work together?
Production reports output and wastage data to Finance, which calculates costs and profit margins.
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