Organisational structures
AKO
Types of structures
 The structure of business organizations can be described as either tall or flat.
 This refers to the levels of management in the organization's hierarchy and the
corresponding distance between front-line or entry-level employees and top
management.
 Whether a business has a tall or a flat structure can have important impacts on a
variety of elements within the organizational cutlure.
Span of Control
 In contrast to a tall organisation, a flat organisation will have relatively few
layers or just one layer of management. This means that the “Chain of
Command” from top to bottom is short and the “span of control is wide”.
 Span of control refers to the number of employees that each manager is
responsible for. If a manager has lots of employees reporting to them, their
span of control is said to be wide.
 A manager with a small number of direct reports has a narrow span of
control. Due to the small number of management layers, flat organisations
are often small organisations.
Flat structure
 Flat structures have fewer management levels.
 These structures are more common in smaller businesses.
 Focus is on empowering employees rather than focusing on a chain of
command.
 Often lead to more creative and innovated employees.
 Communication is more quick and easy.
Tall structure
 Often require a heirachy system.
 Basically in simplest form, a chain of command.
 As an organisation grows, the longer the chain will get.
 Managers will delegate into separate segments of the company
(marketing, accounting, legal etc)
 Narrow span of control allows for closer supervision of staff
Difference
 Layers of Management
 The difference between tall and flat organizational structures is the layers of
management. In a flat organizational structure. There may be just one top
manager who is an owner or CEO of the company, overseeing a handful of
other employees, all with equal levels of authority. In a tall organizational
structure, by contrast, there are multiple layers of authority between the
CEO and low-level employees. For example, an entry-level employee may
report to a supervisor, who reports to a manager, who reports to a director,
who reports to a vice president, who, finally, reports to top management.
 Employee Motivation
 Employee motivation is a key factor in any organizational structure. While
employees in a flat organization may feel as though they have more direct
influence on the company, they may also feel as though they have no
room for advancement. On the other hand, employees at a tall
organization have many layers through which to advance their careers, but
may become frustrated at their relative lack of influence at lower levels
within the company.
Difference - continued
 Organizational Complexity
 Generally, the more complex an organization becomes, the taller the
organization must be. An employee in a small organization may be able to
handle all the company's marketing duties; however, as the organization
grows, that employee may need subordinates to whom he can delegate
certain tasks. Additionally, top managers can generally be much more
effective if they have a handful of upper-level managers reporting to them,
as opposed to dozens or more of lower-level employees.
 Flexibility
 One advantage a flat organizational structure has over a tall one is the
level of flexibility. Decisions can often be made and carried out more
quickly in flat structures because there are few layers of communication
between the employees doing the work and those making the decisions.
Therefore, directives and feedback can be communicated more quickly to
allow for necessary changes.
AKOs structure
 AKO is a small coffee business located in an isolated area of Dunedin
where the most common customers are students and teachers.
 Because the company has only 2 stores, there is little need for a large
organisational structure. This is also due to the nature of the business as a
coffee shop has little need for various job levels.
Mark
Supervisor
Baristas
Supervisor (link)
Baristas (link)
Comparison (AKO)
 If AKO were to instead have a tall structure as opposed to flat then it would
more likely affect all the staff as there are very little staff in the business.
 Baristas would have certain authorities delegated that would separate their
jobs and categorise them individually.
 Supervisors may be delegated to supervise only certain staff members
instead of everyone considered to be below them.
 By doing this it means that there would be a lot more structure in the
organisation and that jobs that may have been voluntary between lower
staff would become delegated to certain staffs new titles. This will also
narrow the span of control between staff.
References
 http://www.google.co.nz/imgres?imgurl=http://media.nngroup.com/medi
a/editor/2013/11/05/flat%252520vs%252520deep%252520hierarchy%252520
visualization.png&imgrefurl=http://www.nngroup.com/articles/flat-vs-deephierarchy/&h=203&w=1200&tbnid=n_313MZdEa680M:&zoom=1&docid=6by
4j7CpUBiwgM&ei=41tLVbvYLuLXmAWu6YD4AQ&tbm=isch&ved=0CE0QMyg
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 http://www.learnmanagement2.com/flat%20structure.htm
 http://smallbusiness.chron.com/difference-between-tall-flat-organizationalstructure-23345.html