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Organization & Management - Hierarchical Structures

Hierarchical structures show the chain of command in an organization. They resemble a pyramid shape with few senior managers at the top and more employees at the bottom. Information and instructions flow down the hierarchy while performance information flows up. Hierarchies can be tall, with many management layers and narrow spans of control, or flat with fewer layers and wider spans of control. Tall structures allow for specialization but slow decision making, while flat structures speed communication and decisions but reduce management control.

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83 views

Organization & Management - Hierarchical Structures

Hierarchical structures show the chain of command in an organization. They resemble a pyramid shape with few senior managers at the top and more employees at the bottom. Information and instructions flow down the hierarchy while performance information flows up. Hierarchies can be tall, with many management layers and narrow spans of control, or flat with fewer layers and wider spans of control. Tall structures allow for specialization but slow decision making, while flat structures speed communication and decisions but reduce management control.

Uploaded by

adamluthfaris
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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HIERARCHICAL STRUCTURES

A hierarchy shows the chain of command in an organization:

➢ Different organizations are structured in different ways depending on their


size, their objectives and in many cases, what their managers feel is the best
way of achieving those objectives.

➢ Some managers like direct control over operations, some prefer to delegate
tasks to others.

➢ The organizational hierarchy refers to the different layers of management and


authority within an organization.

➢ The structure of a hierarchical organization looks like a pyramid.

➢ It is narrow at the top because most of the organizations have only few senior
managers or directors.

➢ It then gets wider in the middle because there are a larger number of middle
managers in charge of departments and divisions within departments.

➢ It is widest at the base where those employees are represented.

➢ A chain of command is the structure in a business that allows instructions to be


passed down from a person to another, below them in the command.

➢ The higher up hierarchy, the more authority and responsibility a manager has.

o Key business objectives, major decisions and actions agreed by senior


managers are communicated down their chain of command.

o Responsibility for day-to-day decision-making and management is


delegated down the chain of command to lower levels of management.

o Managers and employees are accountable to their more senior managers.

o Information which helps managers and directors make decisions, such as


information relating to sales, customer feedback, costs and performance,
is passed up the chain of command.
Advantages of a hierarchical business Disadvantages of a hierarchical
structure business structure
 Communications up and down the
hierarchy can take time and slow
down decision-making
✓ There is a clear management  Managers recruited to senior
structure positions may have limited experience
✓ Individual roles and responsibilities and understanding of all the other
are clear to everyone inside the functions performed in the
organization organization
✓ Senior managers and directors can  If senior managers take all major
make all major decisions and control decisions, it can discourage junior
the organization. managers and employees from
developing new ideas and using their
own initiative to solve business
problems
Organizational hierarchies can be tall or flat:

➢ Some organizations use a much flatter structure where teams and their leaders
are free to manage their own tasks and projects on a day-to-day basis.

➢ However, not all businesses have such flat structures.

➢ Some businesses decided to have many layers of management and a long chain
of command. It has a tall structure.

o Managers have relatively few subordinates reporting to them.

o That is, each manager has a narrow span of control.

➢ Some businesses chose to have fewer layer of management and a short chain of
command. It has flat structure.

o Managers have many subordinates reporting to them.

o That is, each manager has a wide span of control.


Tall organizational structures Flat organizational structures
Advantages:
✓ Communications are quicker and
Advantages: problems can be solved faster
✓ Managers have fewer because there are fewer layers of
subordinates and are therefore management to go through.
able to communicate with them ✓ Management costs are lower
and supervise them more easily. because there are fewer
✓ Managers and employees can managers.
specialize in those tasks they are ✓ Senior managers are less remote
best able to do because they have from their employees and the
fewer responsibilities. issues faced by the business.
✓ Managers and employees have
Disadvantages: greater freedom to make
 Management costs are high decisions and may be more
because there are more managers. motivated.
 Senior managers may find it
difficult to manage and Disadvantages:
communicate with large numbers  Senior managers may have less
of junior managers. direct control over their
 Decision-making may be slow as organization and subordinates.
there are many layers of  Managers have more subordinates
management to consult and reporting to them making it more
possibly many procedures to difficult to communicate with
follow. them and to supervise them
personally. More mistakes may be
made.

Some key words:

 Chain of command: the structure in a business that allows instructions to be


passed down from a person to another, below them in the command.

 Subordinate: someone who is lower in rank, under authority of a superior


(manager).

 Span of control: how many subordinates work directly under a manager.

 Authority: someone that has recognised power to make decisions and to


delegate tasks.

 Delegation: the process of giving authority to a subordinate to perform a task


(instructions).

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