Organization and Management

Organizational Structure:

Levels of management and division of responsibility within an organization.

Key features of an organization structure

It is a hierarchy:

 There are different levels

 Each level has different degree of authority
 People from same level has same degree of authority

Organized in to different departments with a particular job/ function

With different levels of management, a chain of command is established.

 Chain of command is, how power and authority are passed down from the top to the lower
levels in the organization structure.

For each position, a clearly outlined job description (JD) need to be made available
Advantages of an organization chart:

 Staff gets to know of the communication channel/ path to follow when communicating with
different staff members.
 Each individual would know to whom they are accountable to and over whom they have
authority. Employees would know from whom they should take orders from.
 Shows the link between different departments of the organization

Chain of command and span of control

 Span of control: number of subordinates working directly under a manager.

 A tall organization structure has a longer chain of command and results a narrow span of control
 A wide organization structure has a short chain of command and results a wide span of control

Business A: has a tall organization structure and a long chain of command. Span of control is 2 (narrow
span of control)

Business B: has a wide organization structure and a short chain of command. Span of control is 5 (wide
span of control)

No perfect type of organization structure. Recent trend has been to develop wide organization
structures. When whole levels of management is removed from the structure to convert a tall
organization structure to a wide one, it is called de-layering
Advantages of short chains of command

 Allows quicker communication and faster decision making due to fewer levels in the structure
 Top management becomes closer to the operational level staff and the customers.
 Span of control is wider and each manager becomes responsible for more subordinates
 This will improve manager’s understanding of different people and their skills. And allow
delegation. This will improve overall efficiency of the company
 Staff feels they are trusted and free which would improve their job satisfaction and
motivation

Roles Responsibilities and inter-relationships between people in organization

Organization structure for a larger organization

Key features of a organization structure for a large organization

Still largely organized based on functional departments such as Finance and marketing.

 Staff becomes loyal to the department rather than the overall company
 Conflicts can occur among departments (eg: marketing wants to spend advertising but finance
wants to reduce advertising cost)
 Line manages: have authority to give orders to staff directly under him and implement decisions
within the department. They have responsibility over people below them in the organization
hierarchy

Regional departments (such as the French Division) are also available. This department will have
specialized knowledge of operations and performance in stores in the specified region (eg: French
Division will have special knowledge of performance of stores in France)
Other departments which do not have a typical function would also be available. These would employee
specialists in a particular area (Eg: economic forecasting department). These departments directly report
to the board of directors. Staff would have in-depth knowledge of the specific topic than about the
operations of the company (eg: economic forecasting department would have specialized knowledge of
economic developments in different economies more than the knowledge of operations in the
company)

 People in the departments are called staff managers because they provide specialized advice
and support to board of directors and line managers. They are very well qualifies experts.

Role of the management

 Planning: Planning for the future growth and success of the organization and for the resources
required to achieve this success.
 Organizing: Work needs to be delegated to subordinates with responsibility and authority.
Resources to fulfill those tasks should also be provided. arranging human and other resource as
required is called organizing
 Coordinating: Bringing together all required staff from all departments to implement a particular
task. Eg: bringing together marketing staff and operations department staff to finalize an
advertisement campaign.
 Commanding: Overlooking that the tasks are being carried out properly and providing required
leadership and guidance to get the work done.
 Controlling: Measures and evaluates work of all individuals and groups to make sure that they
are on target and are not struggling with work. Manager must ensure that the organization
targets are being met. If some staff is failing to do what is expected of them, manager needs to
take corrective action (training, providing extra staff, disciplining staff, etc).

Delegation

This is giving subordinates the authority to perform a particular task. However, the final responsibility
cannot be delegated to subordinates. If the subordinates doesn’t do a good job, them the manager is
responsible.

Advantages of delegation

 Helps the managers to get work done in time with efficiency and accuracy. Manager cant do all
tasks by himself.
 Helps managers to evaluate staff. (eg: for promotions and salary increments)
 Managers would have time to focus on more important work
 Work would be more challenging and interesting to and Staff will be motivated
o This will reduce absenteeism (not coming to work/taking leave), staff turnover
 Company won’t be dependent on one person (the manager)
 Creativity and innovativeness of subordinates might help to improve division’s performance and
overall company performance

Why might a manager not delegate

  Manager might be afraid that the subordinate might fail. Hence the manager wants to do
everything by himself.
 Manager might be afraid that the subordinate might be better than him. This makes manager’s
job insecure.

Good Managers would:

 Motivate staff
 Provide guidance and advice to people they manage
 Inspire their subordinates and encourage them to achieve more than they thought possible
 To keep costs under control
 Increase profits for the business

Leadership

Leader: is someone who can inspire people and get the best out of the work force, getting them to work
for a common goal.

Leadership styles

Leadership styles is Different approaches to dealing with people when in a position of authority.

Autocratic leadership

Managers expect to be in-charge of the business and to have their orders followed. They keep
themselves separate from others. They keep information for themselves and takes all decisions by
themselves. Workers get to know only what they need to know and communication is only one way,
that is top down.

Democratic Leadership
Get other employees involved in decision making process. Information will be openly shared and
discussed before final decisions are being made (final decision often made by the leader).
Communication will be both top-down and bottom-up.

Laissez –faire leadership

Laissez –faire means “leave to do” in French. These type of leaders make the broad objectives of the
business known to employees but then they are left to make their own decisions and organize their own
work.

Style of leadership adopted will depend on the nature of employees dealt with and the nature of the
problem to be solved. Different management styles may be adopted by the same manager depending
on the situation.

Trade Unions

This is a group of workers who have joined together to ensure their interests are protected. Workers
who are part of a trade union will pay an annual subscription to the trade union.

Reasons why workers join trade unions

 Strength in numbers in ensuring their collective interests are safe

 Improved working conditions (Pay, hours of work, holidays)
 Improved working environment (Health and safety in work environment, proper lighting,
enough air in the building)
 Benefits for members who are not working due to sickness, retirement, etc.
 Advice and financial support to members who were wrongly treated by the company (improper
dismissal).
 Special benefits negotiated for trade union members (eg: discounts, provision of sporting
facilities or Gyms)
  Employment where there is a “closed shop” (Closed shop is when all employees must be a
member if the same trade union.)

Disadvantages of being part of a trade union

 Costs money to be a member

 Might have to take part in union action even if you don’t agree to the demands.