The Big Idea
How a business is structured and how it manages and leads its people directly affects how well it operates, how productive its workers are, and how satisfied and motivated those workers feel.
Organisational Structures
How hierarchy, chain of command, and span of control determine whether a business is tall or flat.
Management Roles
What different managers do and how delegation helps them work more effectively.
Leadership Styles
Autocratic, democratic, and laissez-faire approaches and when each one works best.
Trade Unions
How workers organise collectively to improve pay, conditions, and workplace rights.
Organisational Charts & Roles
What Is an Organisational Structure?
An organisational structure is the framework that shows how a business is arranged. It shows who reports to whom, what each person's role is, and what they're responsible for.
Think of it like the skeleton of the organisation. Just as your skeleton holds your body up and allows movement, an organisational structure holds the business together and allows it to function. A well-designed structure means:
- Everyone knows what they're supposed to do
- People know who to ask for help
- Information flows smoothly
- The business can operate efficiently
Key Concept 1: Hierarchy
Hierarchy refers to the levels of authority in an organisation — essentially, who has power over whom. Imagine a pyramid: the further up you go, the more power and authority you have.
CHIEF EXECUTIVE
|
_____________|_____________
| | |
MANAGER A MANAGER B MANAGER C
| | |
STAFF 1-3 STAFF 4-6 STAFF 7-9
The top of the hierarchy is occupied by senior managers (directors, CEOs) who have the most authority. As you move down, each level has less authority but more employees to manage. The bottom consists of frontline workers or junior staff.
Key Concept 2: Chain of Command
The chain of command is the formal pathway of authority that flows downward from the top of the organisation. It answers the question: Who reports to whom?
In a real business, the chain of command might look like this:
- You (a shop assistant) report to the Store Manager
- The Store Manager reports to the Regional Manager
- The Regional Manager reports to the Finance Director
- The Finance Director reports to the CEO
The length of the chain of command is crucial. A long chain means there are many levels between the top and bottom. A short chain means fewer levels. This affects:
- Communication: With a long chain, messages have to go through more people, so they can get distorted or delayed.
- Decision-making: A short chain means decisions can be made faster because they don't need to go through as many layers.
Key Concept 3: Span of Control
Span of control is the number of employees that one manager or supervisor can effectively manage.
managers can only manage a limited number of people well
Span of control = Number of people directly under one manager
Narrow span of control:
Leadership Styles