Page 26 - E1 Integrated Workbook STUDENT 2018

Chapter 2

Types of structure

Type of structure

Advantages Disadvantages

 Fast decision  Success relies
making. heavily on capability
Entrepreneurial of owner-manager.

 Structure is built around  Good control and
the owner manager. direction towards  Lack of career
common goals. structure.

 Typical of small
businesses in early  Close bond to  Cannot cope with
stages of development. workforce. diversification or
growth.

 Economies of scale.  Managers focus on
interests of own
Functional  Defined career path. function rather than
interests of company
 Groups together  Standardisation. overall.
employees that
undertake similar tasks.  Specialists more  Slow decision
comfortable. making.
 Suitable for an
organisation which has  Cannot cope with
relatively few products diversification.
or locations and which
exists in a relatively
stable environment.

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