Organisational Chart

Learn what the differences are etc.

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Decentralised

Authority to make most decisions is shared out. Power can be delegated to people below. eg. Sales manager to Sales officer.

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Centralised

All major decisions made by  one person or a few senior managers.

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Advantages of Decentralised

Employees can use expert knowledge of their sector to make quick decisions.

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Disadvantages of decentralised

Inconsistencies may be developed between departments. 

Decision makers might not be able to see the overall needs of the business. 

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Advantages of centralised

Senior managers tend to have plenty of experience and can get and overview of the whole business.

Policies will be uniform throughout the business.

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Disadvantages of centralised

Decisions can take a long time to filter through employees. This means the organisation reacts slowly to change.

Central managers may lack specialist knowledge. 

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Order of organisational charts

Person at top - has authority of the people below.

People below - subordiantes

This is called the chain of command.

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Span of control

Number of people that a worker directly controls.

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