Business Organization

Organisation chart is a formal method of organizing the human resources of a company by giving employees a defined position with proper authority and responsibility.

Authority is the power to take decisions

Responsibility means being accountable for a particular action

There are two types of organisation structure:

1. Tall Structures are the ones that have a higher number of positions which are extended vertically, creating a lengthy organisation chart. This system reduces individual workload but delays the decision making process. It may be referred to as a bureaucratic system.
2. Flat Structures refer to the structures where the number of positions is comparatively less. In this system, decision making is more flexible, hence faster decisions can be made. However, the individual workload is higher

Span of Control - the number of workers controlled by a single position. There are two types of span of control:

1. Wide span of control, which controls a large number of workers
2. Narrow span of control, which controls relatively less number of workers

Delegation refers to passing responsibility and authority to lower level workers in order to train them for undertaking future decision making roles. Moreover, using delegation, the senior management's workload us going to be shared with the lower management.