1. Organisational Structure
Key Terms

2. Organisational structure
The relationship between different people & functions in an organisation – both vertically, from shop-floor workers through supervisors and managers to directors, and horizontally between different functions and people at the same level

3. Organisational chart
A diagram showing the lines of authority and layers of hierarchy in an organisation

4. Organisational hierarchy
The vertical division of authority and accountability in an organisation

5. Levels of hierarchy
The number of different supervisory and management levels between the shop floor and the chief executive in an organisation

6. Span of control
The number of subordinates whom a manager is required to supervise directly

7. Delegation
The process of passing authority down the hierarchy from a manager to a subordinate

8. Responsibility
Being accountable for one’s actions

9. Authority
The ability or power to carry out a task

10. Accountability
The extent to which a named individual is held responsible for the success or failure of a particular policy, project or piece of work

11. Communication
The process of exchanging information or ideas between two or more individuals or groups
Internal – within the organisation
External – with individuals, groups & organisations outside the business (i.e. suppliers, customers)

12. Communication
One-way = communication without any feedback, or giving instructions in an authoritarian manner
Two-way = communication with feedback
Communication channel = the route through which communication occurs
Open – any staff member can have access to information
Closed – access to information is restricted

13. Channels of communication
Formal – channels established & approved by senior management
Information – outside of the official channels, often developed by employees themselves (the ‘grapevine’ & gossip)

14. Vertical communication
When information is passed up & down the chain of command
May be downwards, or top-down communication
May be upwards, or bottom-up communication

15. Lateral communication
When people at the same level within an organisation pass information to each other

16. Quality Circles A group of employees whose function is to:
Identify problems
Consider alternative solutions
Recommend suitable outcomes to management
Example of delegation
Workers’ jobs are enriched

17. Communication Flows
Effective communication > more effective decision-making
Easier to introduce change
Better coordination across departments
More motivated & committed workforce
Business is more in tune with its customers and key stakeholders

18. What influences the structure of an organisation?

19. What influences the structure of an organisation?
Size of the organisation
Nature of the organisation
Culture & attitudes of senior management
Skill & experience of its workforce