Organisational structure

In one paragraph

How a business arranges who reports to whom. It sounds like an administrative detail and it decides how fast decisions get made.

Chain of command is the line of authority from top to bottom. Span of control is how many people report directly to one manager. Levels of hierarchy is how many layers there are.

A tall structure has many layers and narrow spans: close supervision, clear promotion routes, and slow communication because messages pass through many hands. A flat structure has few layers and wide spans: faster decisions, more delegation and autonomy, and managers who may be stretched too thin to support anyone properly.

Delayering is removing levels of management — cheaper and faster, at the cost of promotion prospects, workload and often morale.

Structures can also be organised by

Function (marketing, finance, operations), product, region, or a matrix where people report both to a function and to a project. Matrix structures use expertise well and produce genuine conflicts about whose priorities win.

How to actually use it

• Count your own span. Beyond roughly seven or eight direct reports, most managers stop managing and start firefighting.
• If decisions are slow, count the layers a decision passes through before someone can say yes. That number is usually the problem.

Where it breaks down

• The chart describes reporting lines, not how work actually flows. Real influence and real communication routinely ignore it.

If you are being examined on it

Link the structure to a consequence — speed of communication, cost, motivation — and then to the business in the case. Describing tall versus flat alone is a low-mark answer.

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