2.2 IB Business Organizational Structures

Organizational Structures 1

100

The administrative systems within an organization, such as the formal policies and procedures of the business.

Bureaucracy

200

The formal lines of authority in an organization. It can be seen via an organizational chart, which shows the formal path through which commands and decisions are communicated from senior managers to subordinates.

Chain of command

300

The extent to which a person is held responsible for the success or failure of a task, job, or project.

Accountability

400

The situation in an organization where decision-making authority is delegated throughout, rather from a central authoritative group.

Decentralization

500

A form of flexible organizational structure that uses teams of employees with suitable skills and qualifications drawn from different departments or divisions of the business.

Project based or Matrix structure

Organizational Structures 2

100

A diagrammatic representation of an organization’s formal organizational structure

Organizational Chart

200

refers to the official rights of a line manager to give orders and instructions to his/her subordinates in the organization to get things done

Authority

300

This type of organizational chart has few layers of authority and there is a wide span of control

Flat/horizontal

400

Because Chesterfield County Public Schools uses a combination of full time, part time and vendors, it is a good example of this type of organizational structure

Shamrock organization

500

This is an example of a planned external change that could result in a company changing its organizational structure

merger or joint venture

Organizational Structures 3

100

Structuring a workforce according to the goods or services sold.

Organization by product

200

This type of span of control means a line manager has responsibility for many subordinates.

wide span of control

300

Tall or vertical organizational charts can be motivating to employees as there are opportunities for this

promotion, advancement, moving up the ladder

400

This can influence individuals or be influenced by an individual

Culture

500

This type of organizational chart is most often associated with the military and emergency services

Hierarchical 

Organizational Structures 4

100

Structuring a workforce according to different geographical areas based on where the firm’s operations are.

Organization by region

200

This refers to the number of layers of formal authority

Levels of hierarchy

300

These are two factors we discussed that can cause a business to change its organizational structure

Internal and external 

400

The purpose of this action in an organization is to cut costs and reduce bureaucracy. However, it can lead to resentment due to a wider span of control

Delayering

500

This can either motivate employees because they feel valued or demotivate employees because they feel they are doing extra work with no extra pay

Delegation

Organizational Structures 5

100

Refers to how many workers are directly accountable to (or under the authority of) a particular line manager.

Span of control

200

Bureaucracy is associated with these types of organizations

Tall or large and well established. Centralized

300

In this organizational structure, decision making tends to be centralized and relatively quick

Tall structure

400

This allows managers to have better control and understanding of what the business does

Communication

500

Correctly identify all three of the following:

1. creating a product or service that is new, better and of commercial value

2. Creating a product that is completely new to the market

3. creating a change/improvement to a product that already exists

Innovation

Invention

Iteration