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Organisation of Departments

Standard Grade Administration Unit 1a

Organisation - Why?
In order for a business to survive and grow it must

Be organised

And have good communications

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

Central Scotland Police

Who Uses An Organisation Chart?

Visitors to the organisation New members of staff Receptionist

Other Information On An Organisation Chart


Employee Names Job Titles Room Numbers Groupings within the organisation Photographs Telephone Numbers

Advantages And Disadvantages Of Using An Organisation Chart


Advantages
Useful for visitors to see the overall size of the business and where people fit in Useful for new employees to get an overall feel for the business Employees can see an overview of the business

Disadvantages
Information can soon be out of date ie people leave

What Information Does An Organisation Chart Show?


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

Lower Level Employees

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

The more levels the more chance of information breaking down

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

In Knox Academy who could Mr Flood delegate a task or activity to?

Pyramid (Hierarchical) Structure

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 Structure


Many levels of management
1 2 3 4 5

Tall Organisation

Tall Organisation
Features

Examples

More levels of management There are many lines of communication Tends to be seen in longer-established organisations

University/College Hospital Large multi-national oil company School

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 Structure


Few levels of management

Flat Organisation

Flat Organisation
Features

Examples

Fewer levels of management There are fewer lines of communication Tends to be seen in more modern organisations

Charity Employment agency Nursing home Local shop

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

Cost Acountant Senior Accounts Assistant Accounts Assistant

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

How Do Lateral Relationships Work?


Lateral relationships exist in organisations where members of staff are directly responsible to the same immediate supervisor or manager

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

Human Resources 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

with solutions to problems or to improve quality