JAY Ijilmurun
Organisational structure and Culture
Organisation structure is a system in which members of an organisation is ranked according to
relative status or authority. It identifies each job, its function and where it reports to within the
organisation. The organisation is developed to establish how the organisation operates and it is
illustrated using an organisational chart. Organisational chart is visual structure of roles and
responsibilities and its reporting progress. The diagram shows organisations hierarchy.
The legal structure is what business chooses is fundamental to the way it operates. This legal
framework determines who shares in the profits and losses, how tax is paid, where legal liabilities
rests. It also determines the nature of a business' relationships with business associates, investors,
creditors and employees. (tutor2u.net) 2012.
There are few main options for a business legal structure
1.
2.
3.
4.
5.
6.
Sole Trader
Partnership
Limited liability partnership
Limited Company
Public limited company
Non-profit / Social Enterprise
JAY Ijilmurun
1.1 Compare and contrast different organisational structures and culture
For my organisations I have chosen flat structured local fish and chips shop (Sea Rider) and tall
structured Hilton Hotel.
Sea Rider
The Local fish and chip shop uses a flat structure which most of the small organisation uses
and it possesses many advantages and the culture of the organisation depends on the
behaviour of the management. Leadership and Management styles influence on the
structure of the organisation which has an effect on organisational culture that lead to
individual and team behaviour which impacts on productivity and business performance. In
this case, the manager is very friendly, professional and good with people that allow him to
build a strong relationship with the customers as well as his colleagues. He also manages the
team very well and respects his staff equally and efficiently which builds the morale of the
staff delegating them with a clear instruction with each role leading a good work
environment as well as excellent customer service. This affects the business enormously and
effectively as everyone is satisfied with their performance at work. The organisational
culture within the business is that mix of task and dominantly role culture. Role culture can
be illustrated as one building each column and beams that supports each other and if one
leaves that the role continues. People are selected to perform roles satisfactorily; personal
power is frowned upon and expert power is tolerated only in its proper place. Rules and
procedures are the chief methods of influence. The efficiency of this culture depends on the
rationality of the allocation of work and responsibility rather than on individual
personalities. This type of organisation is likely to be successful in a stable environment,
where the market is steady, predictable or controllable, or where the product’s life cycle is
long. Marco Van Dyk (2014)
There are many advantageous edges for flat structured businesses as there is quick and
efficient communication within the team who are under only few layer of management. This
allows the organisation to act efficient and accurately towards certain changes in
environment or economically having to go through only few management to make decisions
rather than other structures like tall. Information or creative and innovative ideas from
bottom to top management can be heard.
JAY Ijilmurun
Hilton Hotel
Hilton Hotel uses a tall structure within the organisation that is needed much more
management levels required as there are hundreds of people working in one shift. There are
many different departments within the organisation.
In this structure, member of staff can be supervised and their activities monitored closely.
This is called as a small span of control. Disadvantage of a smaller span of control is that
employees may not collaborate easily with other departments or workers many levels
above or below them. Lack of collaboration and teamwork sometimes means that some
new ideas and innovations may never reach production from the below level.
As the number of management level increases, the communication progress slows as it has
to pass though few level of management and sometimes in some case that information can
be filtered or dissembled. Because of that the decision making progress slows as it has to go
through one management and absorb it and act on it then pass it on to next level of
management. Decision makings take long time but to implement it takes even longer. In the
tall structure, it quite common that they function on military style. This does not always
result a better result as bright, innovative and creative people tend to leave the organisation
because of the complicated process to get things done or be heard. This affects the
organisation as they are losing a huge assets within the organisation.
Tall organisation structure with a narrow span of control, complex and a long chain of
command, while flat organisational structure with a wider span of control that has fewer
levels of hierarchy which is only three layers. Span of control refers to the number of
JAY Ijilmurun
employees that report to a manager. Number of manager an organisation has is determined
by the number of employees a manager can efficiently and effectively direct.
In tall structure, every manager have small area of control over few subordinates that work
under his management in his or her department. As the organisation expands, the structure
will became taller and the level of management increase. These managers have to be able
to control, supervise the member of staffs easily by enhancing the quality of the
performance while building a bond between mana
In a tall structure, every manager has a small area of control as they only have a few
subordinates to manage. As the organisation grows, the structure will become taller and the
number of management levels increases. A manager must be able to control, supervise
subordinates and coordinates the effort of subordinates easily. Enhance quality of
performance while building greater bond between manager and subordinates through
working closely together. However, there are some drawbacks of tall organisational
structure and narrow span of control such as high management level wages to be pay out,
slow decision making and discouraging employees to be independent decision maker in
times of critical decision making especially when a problem arises as decision is made by
upper level management.
In contrast, flat organisational structure has fewer level of management which means lesser
manager in the organisation and lower managerial level wages to be pay put. Wider span of
control results in flat organisation as managers through this structure is able to manage
many subordinates. Decision making in flat organisational structure is faster than tall
organisational structure because there are few layers of communication between managers
and subordinates. Although subordinates have more power but they cannot find ways to
advance and enhance further growth in their organisation. Subordinates are able to make
critical decision at certain level when there is a problem that needs urgent remedy.
Limitations of flat organisational structure or wider span of control are organisation may
needs to invest heavily on the employees training in order to let the managers know the
jobs and make better decisions. Many mistakes could occur, compare to tall organisational
structure because there are many subordinates, looser control, lesser qualified personals to
study a proposal and also less guidance for subordinates.
JAY Ijilmurun
Bibliography
Marco Van Dyk (2014) Organisations and Behaviour slides
Maurei Moulins J. (2013) Management and Organisational behaviour. 8th edition
Tutor2u (2012) Available from http://www.tutor2u.net/blog/index.php/business-studies/
JAY Ijilmurun
JAY Ijilmurun