Types of Business Structures

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  • Types of Business Structures
    • Mechanistic
      • Use a centralised, traditional structure with well defined hierarchy of power
      • Decisions made by managers at the top of the hierarchy
      • Uses a tall structure, so messages can take a long time to travel through the business
      • Suited to business that don't need to adapt to change very often
      • Departments given tasks which don't vary much
        • Easy to assign resources efficiently
        • Can be slow to make changes within the business
      • Employees are specialised in certain tasks and tend to work separately on them
      • E.g. each marketing employee might focus on a specific market rather than all of them looking at the whole market
    • Organic
      • Uses a decentralised structure
      • Employees get more say in decision making
      • Uses a flat structure which allows fast communication through the business
      • Best suited to an uncertain, changing environment as information can be acted upon quickly
      • Employees usually work in teams to complete tasks, rather than each having a single role
        • The teams can be adapted to suit the situation

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