1. 15 September 2015© easilyinteractive.com 2006-101 Organisational structure Definitions Press F5 on your keyboard to launch this PowerPoint presentation

2. Learning Objectives  To understand the following key terms:  Span of control  Hierarchy  Chain of command  Delegation  To be able to identify the roles responsibilities and inter-relationships between people from an organisational chart  Extension - To be to evaluate advantages and disadvantages of a particular structure 15 September 2015© easilyinteractive.com 2006-102

3. 15 September 2015© easilyinteractive.com 2006-103 Organisational structure definitions (1/2)  Hierarchy: The number of levels in an organisation  E.g. School  Chain of command: The way authority and power are passed down in the business - Who is responsible to whom? * Headteacher Deputy Heads Heads of Faculty Heads of Department Teaching Staff

4. 15 September 2015© easilyinteractive.com 2006-104 Organisational structure definitions (2/2)  Span of control: The number of subordinates reporting to a superior * Tall hierarchy Narrow span of control Tight supervision and control Short hierarchy Wide span of control Freedom for subordinates Lower cost

5. 15 September 2015© easilyinteractive.com 2006-105 Organisational structure  Identify the span of control of:  the Managing Director  the Purchasing Manager  Would you describe this as a wide or a narrow hierarchy? Production Control Manager Quality Manager Marketing Manager Sales Manager Training Officer Industrial Relations Officer Buyer Logistics Officer Warehouse manager Sales Representatives Wages Clerk Cost Accountant Purchasing Manager Production Manager Finance Manager Marketing Manager Personnel Manager Managing Director *

6. 15 September 2015© easilyinteractive.com 2006-106 Organisational structure task  Use PowerPoint to construct an organisation chart of the school * Production Control Manager Quality Manager Public Relations Sales Manager Training Officer Industrial Relations Officer Buyer Transport Officer Warehouse manager Sales Representatives Wages Clerk Cost Accountant Purchasing Manager Production Manager Finance Manager Marketing Manager Personnel Manager Managing Director Alternatively use mind-mapping software such as OpenMind by Matchware

7. Learning Objectives  To understand what an organisational chart is and its purpose  To be able to interpret an organisational chart  To be able to draw an organisational chart from information given  To be able to evaluate how appropriate an organisational chart is in a particular context 15 September 2015© easilyinteractive.com 2006-107

8. 15 September 2015© easilyinteractive.com 2006-108 Organisational structure Sinbad Plc task *  There are several options for doing this task  Print out the task alone (pdf). Students draw their own hierarchy  Print out the task with the blank hierarchy (worksheet) for students to fill in  Do the task as an interactive class exercise  This task also serves as an introduction to some of the language and topics that students will be covering later.

9. 15 September 2015© easilyinteractive.com 2006-109 Organisational structure Formal and informal structures

10. 15 September 2015© easilyinteractive.com 2006-1010 Formal and informal structures  The formal structure of the organisation is the official structure  Each employee has clear authority and responsibility with official lines of communication both upwards and downwards  Informal structure is based on friendship groups, sports teams etc. *

11. 15 September 2015© easilyinteractive.com 2006-1011 Formal and informal structures task  Identify a range of formal and informal groups that are within your school *  Formal  Informal

12. 15 September 2015© easilyinteractive.com 2006-1012 Organisational structures Delegation, centralisation and decentralisation

13. 15 September 2015© easilyinteractive.com 2006-1013 Delegation  Delegation: Passing authority (not responsibility) down the hierarchy to subordinates  Involves giving junior managers greater trust and authority  The line manager retains responsibility  Requires the superior to release control *

14. 15 September 2015© easilyinteractive.com 2006-1014 Centralisation and decentralisation  Centralisation: Retaining control within the top levels of the hierarchy – at head office  Decentralisation: Delegating authority down the hierarchy * Centralisation Retains tight control at the top of the organisation  Employees are not able to show flair and initiative Decentralisation Motivates employees by giving them more freedom and responsibility  Employees may not have the experience/training to carry out tasks effectively

15. 15 September 2015© easilyinteractive.com 2006-1015 Organisational structures Delayering

16. 15 September 2015© easilyinteractive.com 2006-1016 Delayering  Delayering: The removal of one or more layers of the hierarchy  Improves communication – makes it faster and reduces ‘Chinese Whispers’  Downsizing: Reducing the size of the business to meet a new, lower level of demand  Organisations delayer to improve efficiency – i.e. in order to produce the same output with fewer inputs *

17. 15 September 2015© easilyinteractive.com 2006-1017 Delayering discussion task  What are the advantages and disadvantages for a business of delayering? * Save money in the long run Speed up communication Reduce bureaucracy  Demoralising  Overload some workers  Confusion during process  Extra training costs  Redundancy costs

18. 15 September 2015© easilyinteractive.com 2006-1018 Organisational structures Business structure

19. 15 September 2015© easilyinteractive.com 2006-1019 Business structure  Division by function: The firm is divided up by the jobs that people do  e.g. Marketing, Finances, Production etc.  Division by product: The firm is divided up by product  Cadbury’s has a manager responsible for each brand, who manages a marketing team  Geographical division: The firm is divided by geographical area.  Most multinational companies have a geographical structure on top of one of the other two structures *

20. 15 September 2015© easilyinteractive.com 2006-1020 Business structure task  What are the advantages and disadvantages for a business being organised in these three ways? * By function Geographically By product Advantages Disadvantages

21. 15 September 2015© easilyinteractive.com 2006-1021 Managing a Business