Organisation Structures

For P3 in your assignment you have to describe the formal structure of two organisations. The following notes will help you to understand why organisations have formal structures. You should also understand the types of structures organisations have and the factors that influence the structure and changes to structure in an organisation.

Why Do Organisations Have Formal Structures?

In a small business most of the tasks needed to operate the business are carried out by a few people. The owners will be responsible for setting objectives for the business and making the key decisions. They will also be responsible for key activities such as managing finances, advertising, selling, dealing with customers, managing staff and buying stocks and other materials. The activity for ‘Sally’s Flower Shop’ illustrates this point.

In a large business more organisation is needed. A large business employs a lot of people and it is necessary that the roles and activities of each employee are identified within the organisation. It is important to make sure that there is enough staff fulfilling all necessary activities to enable the business to operate and achieve its aims.

Within the organisation there must be a process for setting objectives and making decisions and control and co-ordination of activities to make sure objectives are being met. In order to make decisions and control and co-ordinate activities there must be a hierarchy (different levels) of management in the organisation. In college for instance the overall strategy for the college is decided by the Principal who is the senior manager. The Principal has a team of Executive Directors who manage different parts of the college’s activities. The Executive Directors are supported by APs of different academic directorates. The Directorates have ADs who manage groups of courses. Finally