Competitive Organisational Structures. A2 Business Studies. Aims and Objectives. Aim: Understand methods of increasing competitiveness of organisational structures Objectives: Define centralisation and decentralisation. Explain how to delayer a business.
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A2 Business Studies
In the modern day, organisational structures will change on a regular basis as it adapts to changes in the market. It is quite likely more than one structure will appear in a business.
Question to be asked of the case study:
Where the authority for decision-making is delegated to subordinates in the organisational structure.
E.g. Tesco, Morrisons
In groups sort the factors into advantages and disadvantages of centralisation and decentralisation.
More bureaucratic – often too many layers in hierarchy.
Lack of authority down the hierarchy may reduce manager motivation.
Customer service can suffer from flexibility and speed in local decision making.
Decision making is not necessarily strategic.
More difficult to ensure consistent practices and policies.
Who provides strong leadership in a crisis?
Harder to achieve tighter financial control & EOS
Removing levels in the organisational structure to create a leaner and more efficient organisation.
“Aviva is basically removing the regional layer between the individual countries and the group level top management. It is a positive in our view because it should lead to some cost saves and should also mean a simpler management structure.”
Valuable skills, and knowledge may be lost.
Loss of job security may affect motivation negatively.
Harder to implement with legislation – discrimination act.
Workload of mangers likely to increase increasing stress and possibly absenteeism and costs.
Training costs may be greater!