Transcript definition of an organisation chart

S3 Business Management
Unit 1.3
DEFINITION OF AN
ORGANISATION CHART
An organisation
chart “shows the
structure of a
business”
A TYPICAL
ORGANISATION CHART
3.
4.
Sales
Manager
Sales
Director
Marketing
Manager
1.
Board of Directors
2.
Managing Director
Finance
Director
Human Resources
Director
Purchases
Director
Accountant
Human Resources
Manager
Purchases
Manager
DEFINITION OF
AUTHORITY
Authority
means “the
power or ability
to
influence and
control
others”.
DEFINITION OF
RESPONSIBILITY
Responsibility
means “ the duty
an employee has to
carry out their
work”
WHAT IS SHOWN BY AN
ORGANISATION
CHART?
1. Management structure and
2.
3.
4.
5.
6.
7.
main departments
Lines of responsibility
Lines of authority
Lines of communication
Positions of employees
including names, job titles
Reporting structure
Number of people who are
accountable to each manager
DEFINITION OF
ACCOUNTABLE
Accountable means
“being responsible to
someone i.e
manager
for some action
taken”
WHO USES AN
ORGANISATION CHART?
• Visitors to the
organisation
• New members of
staff
• Existing members
of staff
• Receptionist
ADVANTAGES &
DISADVANTAGES OF
ORGANISATION CHARTS
Advantages:
• Visitors - see the size
of the organisation and
where each person fits
in.
• New staff - find out
about other staff in
their department and
the whole organisation
• Existing staff - can see
staff in each
department and who to
contact.
Disadvantage:
• Becomes out of
date quickly as
staff may leave,
new staff join
and/or existing
staff get
promoted.
Advantages of An Organisation
Chart to Employees
• Can immediately see the overall size and
structure of the organisation (how the various
sections are grouped and the main areas of work
of departments/sections).
• Can see at a glance the reporting structures and
lines of communication within the organisation
• Can see the number of people who are
accountable to each senior manager
• Can immediately see the relationship of the
departments and managers within the org.
• Are made aware of the range of activities
undertaken by the organisation.
What is the usual shape
of an organisation
chart?
• An organisation chart is
usually shaped like a pyramid
with a few senior or high
status posts at the top of the
pyramid, with a greater
number of lower status posts
at each levels below. In a
pyramid (or hierarchical)
structure, posts with the
same level of
authority/responsibility are
shown on the same level.
Chief
Exec
Directors
Senior Managers
Managers
Junior Managers
Supervisors
Assistants
Organisational
Structures
• A pyramid structure with many levels
of posts is known as a tall structure.
In recent years there has been a move
towards removing certain levels of
management posts (known as
delayering). This has resulted in flatter
structures. Delayering an organisation
will lead to more posts at each of the
remaining levels.
Features of a Tall Structure
(Pyramid)
• There are usually many
levels of management
• Managers will usually
have narrow spans of
control
• Management posts
tend to be specialised
Advantages of a Tall
Structure
• It should be easier for managers to
supervise staff
• There are likely to be many
opportunities for promotion
• Employees are more likely to know
their immediate boss
• Employees are more likely to know the
scope of their duties and
responsibilities
Disadvantages of a Tall
Structure
• Employees feel undervalued and far
removed from the real decision-making
• Employees may not get the opportunity to
suggest ideas and show initiative
• Decision-making may be slow
• It may take time to communicate decisions
throughout the organisation
• The management structure may be costly
with many levels of highly-paid posts
• May lead to complicated channels of
communication with very formal procedures
Features of a Flat
Structure
• Fewer layers of management
• More modern structure
• Usually as a result of delayering
•
•
•
•
•
Advantages of a Flat
Structure
Employees are given more authority and
responsibility - they are likely to feel more
motivated.
Employees are more likely to be able to show
initiative
Employees are more likely to be less complicated
and less formal - communication is less likely to be
more efficient
Should take less time to reach decisions and for the
organisation to react to situations
Should take less time to communicate decisions
throughout the organisation
Disadvantages of a Flat
Structure
• Workloads of employees are likely to
increase - possibility of stress
• Employees may need training to carry out
new/wider responsibilities
• Where the span of control is too wide,
employees may feel isolated or ignored
• Employees may not be able to meet with
their line manager on a regular basis
• Likely to be fewer opportunities for
promotion to management posts
What are the main types of
relationship within an organisation?
• There are 2 main
types of
relationship within
an organisation:
• Line Relationship
• Lateral
Relationship
Line Relationship
• These exist between line managers
and the staff immediately below
them. Members of staff are
accountable to their line manager for
any actions or decisions they take.
Line relationships are shown by the
vertical lines on an organisation
chart and stretch down through the
whole organisation.
Lateral Relationship
• These exist between employees
who are on the same level and
who report to the same line
manager. The employees cannot
give instructions to each other
or to staff outwith their own
spans of control.
Marketing - Unit 1.3
SG Business Management
What is marketing?
• Marketing is the process of
learning about your customers
and competitors, so that you
can provide the right products
at the right price in the right
place, promoted in the right way
to achieve your business
objectives.
Marketing involves the
following range of
activities:
• Knowing about the product or service and
its market
• Knowing what to produce
• Knowing how much to charge
• Knowing how to persuade people to buy it
• Knowing where to sell it
• Knowing how to get the best mix of these
• Knowing how to deal with customers
The Marketing Mix:
• Product
• Price
• Promotion
• Place
What is market
research?
• Market research gathers information
about consumers, competitors and
distributors wihtin a firm’s target
market. It is a way of identifying
consumers’ buying habits and attitudes
to current and future products.
• Market research can be numerical
(such as what proportion of 16-24 year
olds by The Sun every day?) or
psychological (why do they buy The
Sun).
How is market research
carried out?
• The following research
techniques are commonly used:
- Desk Research
- Field Research
Desk Research
• Desk research involves the use of existing
information from:
- government statistics, for example from
the Census which is carried out every 10
years:
• Newspapers
• Magazines
• Published market research information –
reports in various journals showing trends
in a range of markets for different
products.
When should Desk
Research be used?
• When market information
already exists.
• When it is cheaper to access
existing information rather than
generate new information.
• When it is easier to access –
saves time.
Field Research
• Field Research can be carried out
through:
- the use of questionnaires – set
questions are asked, face-to-face/by
telephone/by post.
- Test Marketing – try out the product
on a small section of the market
- Consumer panel – a group of people
are given a product and asked to
comment on it in detail.
Field research is
undertaken when:
• Information is to be gathered for
a specific purpose.
• Information is to be linked
directly to a product/service.
• Research is to be focused on a
particular company’s needs.