There is a narrow span of control ie each manager has a small number of employees under their control. There is a clear management structure. There will be clear lines of responsibility and control.
The freedom and responsibility of employees (subordinates) is restricted. Decision making is slow Communication has to take place through many layers of management. High management cost.
A flat organization structure has few levels of management between the executive level and the front-line employees. The premise behind a flat organization structure is to empower employees by making them a larger part of the decision- making process.
Disadvantage Workers may have more than one manager/boss. May limit the growth of the organisation. Structure limited to small organisations such as partnerships, co-operatives and some private limited companies.
More/Greater communication between management and workers. Better team sprit. Easier decision making. Fewer levels of management which includes benefits such as lower costs as managers are generally paid more than worker.
This type of organization is suitable when an organization undertakes specialized work for a particular period as one time operation.
Clear Line of Command Quick Decision Making Knowledge Sharing Easier Supervision
This is where the work is divided into specific areas of specialization: jobs and activities are grouped together – also referred to as departmentation. Departmentation can take place in different ways: based on a product or service, by types of customers, or by type of equipment used to produce the business products.
saves us money because of the economies of scale. it helps in privacy of information.
The coordination between different department more difficult than other structures. It also does not allow for flexibility because of the centralization.
D IVISIONAL STRUCTURE Divisional Structures A division is a collection of functions working together to produce a product. Divisions create smaller, manageable parts of a firm. A division has marketing, finance, and other function. Product structure: divisions created according to the type of product or service. Geographic structure: divisions based on the area of a country or world served. Market structure: divisions based on the types of customers served.
Decentralised decision-making Strong product coordination Flexible use of human resources
D ISADVANTAGE High administrative costs Confusion over authority and responsibility (potential) Excessive focus on internal relations Overemphasis on group decision- making Slow response to change (possible)
Virtual Organization An organization uses information and communication technologies to Virtual organization can be thought of as a way in replace or augment some aspect of the organization. People who are virtually organized primarily interact by electronic means.