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Title: IGCSE Business organizational structure
Description: This document encompasses complete summary of the unit Business organizational structure in IGCSE Business. Including Flat, Tall, Decentralized and Centralized organizational structure
Description: This document encompasses complete summary of the unit Business organizational structure in IGCSE Business. Including Flat, Tall, Decentralized and Centralized organizational structure
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Organizational Structures
The Need for an Organizational Structure
An effective organizational structure is essential for business efficiency
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● Chain of command – Understanding of who to report to
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● Span of control – How many subordinates directly work under a manager
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● Delayering – Removing layers of management to create a flatter organizational
structure
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Flat Structure
Tall Structure
A tall structure has multiple levels of management and a long chain of command
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Narrow span of control
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More opportunities for promotion, leading to greater staff motivation
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Employees receive more support from their line manager
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Short chain of command
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Few layers of management
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Quicker decision-making and responsiveness to change
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Employees are empowered to work independently
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Decentralized Structure
Centralized Structure
In a centralized structure, business decisions are made by senior managers and distributed
down the chain of command
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● Clear direction and accountability
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Disadvantages
● Can demotivate employees
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● Relies on strong and competent managers
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Advantages
● Improved employee motivation
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● More responsibility for employees
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● Ineffective decisions may be made by lower-level managers
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Exam Questions
Delayering
● Reduces hierarchy levels, improving speed of communication and reducing wage costs
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● However, it may reduce efficiency as managers have a greater workload and less time for
supervision
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● Better decision-making and supervision by competent managers
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● Greater motivation for employees
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Title: IGCSE Business organizational structure
Description: This document encompasses complete summary of the unit Business organizational structure in IGCSE Business. Including Flat, Tall, Decentralized and Centralized organizational structure
Description: This document encompasses complete summary of the unit Business organizational structure in IGCSE Business. Including Flat, Tall, Decentralized and Centralized organizational structure