UNIT 1.3 – HOW ARE BUSINESSES ORGANISED?
DICTIONARY OF TERMS
Finance Department:
Flat organisation:
This department deals with all the money aspects of a business.
Decisions within business are based on finance and it is the
responsibility of the Finance Department to ensure that it has accurate
records of all the money coming in and out of the company.
A flat organisation has only a few levels of management. This means that the
employees can communicate with each other easily. They all have more
responsibility and decision-making is said to be better.
Functional relationship:
This is when a department offers support to the whole organisation. For
example, the Human Resources Department has a functional relationship
with the whole of the company as it provides the service of supplying
staff to all the other departments within the firm.
Human Resources: This is the department in an organisation which is responsible for the employees
of the company. Human Resources, sometimes referred to as Personnel,
Department are responsible for Recruitment, Training, Conditions of Service
and Welfare.
Line relationship:
Line relationship is said to be the relationship you have with the person who is
directly above or below you. The people below you in the chart are those you
are responsible for and have authority over ie you are in charge of them. The
people above you on the chart have authority over you ie they are in charge of
you.
Marketing Department:
Marketing is the anticipation and identification of consumer wants and
needs, in order to meet these needs and to make a profit. The Marketing
Department is responsible for ensuring that the product/service provided
by their firm is well known and has a good reputation.
Operations/Production Department:
Organisation Chart:
This department is responsible for the actual production
of the goods. Goods produced by the company should be
of quality and fulfil the needs and wants of the customer.
An Organisation Chart shows the links between the departments, the
lines of authority and responsibility and the size of the company.
Span of Control:
This is the number of people a manager is responsible for. The more people –
the greater the span of control. A manager within a tall organisation will have a
smaller span of control as there will be more layers of management to deal with
the employees and managers in an organisation with a flat structure will have a
bigger span of control as there are fewer bosses.
Tall organisation:
A tall organisation has many levels of management which can range from
Managing Director down to the supervisors within a company. Within tall
organisations, communication and decision making is said to be slow as every
level has to be consulted before decisions can be made.