Topic 1- Organisational Structure Mr. BarryYear 12 Business BTEC Extended

Company President Vice President Assistant Vice President Senior Manager Middle Manger Junior Manager Supervisors Employees Senior Manager Middle Manger Junior Manager Supervisors Employees Assistant Vice President Senior Manager Middle Manger Junior Manager Supervisors Employees Senior Manager Middle Manger Junior Manager Supervisors Employees Williams and Co. Furniture Ltd. Organisational Structure Williams and Co. Furniture Ltd. Organisational Structure Mr. BarryYear 12 Business BTEC Extended

FUNCTION When an organisation is structured according to the different purposes of the business. For example sales – whose job it is to generate orders and sell products. Mr. BarryYear 12 Business BTEC Extended

TYPE OF CUSTOMER When an organisation is structured according to the different customers. For example, a stationary supplies business might be divided into: Home – responsible for household stationary needs Business – responsible for business stationary needs Education – responsible for education stationary needs Mr. BarryYear 12 Business BTEC Extended

GEOGRAPHIC AREA When an organisation is structured according to the geographic area it operates in and across. For example, the European division of a business would be responsible for all business activities in Europe. Mr. BarryYear 12 Business BTEC Extended

PRODUCT GROUP When an organisation is structured according to the products and/or services it produces or sells. For example, Apple is divided into the iPod division, iPad division, Mac division and iTunes division. Mr. BarryYear 12 Business BTEC Extended

Centralised or decentralised? The decision will be based on the following factors: - – The size of the organisation – The scale/ importance of the decision – The level of risk – The corporate culture – Management attitudes and competencies – The use of ICT Mr. BarryYear 12 Business BTEC Extended

Centralisation and decentralisation Decision-making power can be either kept in the hands of a few people or it may be spread out among the workforce. The extent that decision-making is spread out amongst the workforce will depend on the characteristics and skills of managers and workers, the degree of trust and the corporate culture. Mr. BarryYear 12 Business BTEC Extended

Centralised Structure Mr. BarryYear 12 Business BTEC Extended

Centralised Structures In centralised structures the vast majority of decisions are made by a very small number of people. All decision are made by the person in the centre, without any form of communication between other members of the organisation. Mr. BarryYear 12 Business BTEC Extended

Centralised Structures Decision Maker AdvantagesDisadvantages Rapid decision making Better control Better sense of direction can benefit from the decision making of experienced senior managers. Possible delays Increased pressure and stress for the decision- maker Inflexibility De-motivating for staff Mr. BarryYear 12 Business BTEC Extended

Decentralised Structure Mr. BarryYear 12 Business BTEC Extended

Decentralised Control Some decision making authority and responsibility is passed on to others in the organisation. E.g. some departments or regional offices may be empowered to make decisions on behalf of the organisation. Key decisions are made centrally. Mr. BarryYear 12 Business BTEC Extended

Decentralised Structures AdvantagesDisadvantages Input from workforce Allows better delegation of responsibility Specialist people with the correct skills can be hired Speedier day-to-day decision making Higher morale Improved accountability Encourages teamwork Direct control of the owner is reduced Owner may not know the strengths and weaknesses of each worker Greater chance of mistakes Greater reliance on effective communication Duplication Mr. BarryYear 12 Business BTEC Extended

Business Functional Areas Mr. BarryYear 12 Business BTEC Extended

Business Functions Human Resources Sales and Marketing Research and Development Production/Operations Customer Service Finance and Accounts Administration and IT Distribution Mr. BarryYear 12 Business BTEC Extended

Human Resources Recruitment and retention – Job descriptions – Person Specifications Dismissal Redundancy Motivation Professional development and training Health and safety and conditions at work Liaison with trade unions Mr. BarryYear 12 Business BTEC Extended

Sales and Marketing Market research Promotion strategies Pricing strategies Sales strategies The sales team Product – advice on new product development, product improvement, extension strategies, target markets Mr. BarryYear 12 Business BTEC Extended

Research and Development New product development Product improvements Competitive advantage Value added Product testing Efficiency gains Cost savings Mr. BarryYear 12 Business BTEC Extended

Finance and Accounts Cash flow – Monitoring income/revenue – Monitoring expenditure Preparing accounts Raising finance – Shares – Loans Links with all other functional areas Mr. BarryYear 12 Business BTEC Extended

Production/Operations Acquiring resources Planning output – labour, capital, land Monitoring costs Projections on future output Production methods – Batch – Flow – Job – Cell Efficiency Mr. BarryYear 12 Business BTEC Extended

Customer Service Monitoring distribution After-sales service Handling consumer enquiries Offering advice to consumers Dealing with customer complaints Publicity and public relations Mr. BarryYear 12 Business BTEC Extended

Distribution Organise delivery to customers Mr. BarryYear 12 Business BTEC Extended

Administration and IT Managing estates – this means the cleaning, health and safety, maintenance, security Reception Clerical work – filing, reporting, recording, record keeping, communication Overview of quality control Use of IT systems Administration is the functional area that supports all the others in what they do. Mr. BarryYear 12 Business BTEC Extended

Group Work Mr. BarryYear 12 Business BTEC Extended