Page 107 - Cambridge IGCSE Business Studies

7: Organisation and management
Revision checklist
● The main features of an organisational
structure, such as hierarchy, chain of
command, span of control and delegation
can be explained with the use of simple
organisation charts.
● The different styles of leadership are
autocratic, democratic and laissez-faire.
● The main functions of management
are planning, organising, coordinating,
commanding and controlling.
● There are benefits and limitations of
delegation.
● Trade unions are organisations that aim
to protect the interests of its members by
improving pay and working conditions and
providing other advice and support when
needed.
2 Bimla is the Chief Executive Offi cer (CEO) of Retro Fashions
CEO
Finance Marketing Operations
Director Director Director
Finance Marketing Operations
Manager Manager Manager
4 Finance 2 Marketing
Assistants Assistants Supervisor A Supervisor B
12 Production 12 Production of trade union membership.
workers workers
Figure 7.10 Organisation chart of Retro Fashions (RF)
Exam practice questions
1 Gopal is the CEO of Gopal Leisure (GL). GL has a tall
organisational structure.
Gopal likes to know what all his directors and managers are
doing. He has delegated authority to the other directors for
marketing, fi nance and human resources management.
The workers in one of GL’s leisure facilities are unhappy about
a recent decision taken by Gopal to block a pay increase.
The local manager had agreed the pay rise with the Director
of Human Resources. The manager said, ‘this is typical of
Gopal’s autocratic leadership style’.
a What is meant by ‘manager’? [2]
b Identify two functions of management. [2]
c Identify and explain two disadvantages of GL’s
‘tall organisational structure’. [4]
d Identify and explain two benefi ts to GL of delegation. [6]
e Do you think that an autocratic management
style is the best approach for Gopal to use?
Justify your answer. [6] 105
(RF). Bimla’s uncle is the Finance Director and her two
brothers are the Marketing Director and Operations Director.
The diagram to the left shows RF’s organisational structure.
Most production workers are members of a trade union.
RF is a very successful and profi table company. Over the
past fi ve years sales and profi ts have increased by 25%.
Bimla believes this is due to the strong leadership provided by
the Board of Directors.
a What is meant by ‘director’? [2]
b Identify two roles of managers. [2]
c Identify and explain two benefi ts to RF’s workers
[4]
d Use the organisation chart to identify and explain
two features of RF’s organisational structure. [6]
e How important is the Board of Directors to the
success of RF? Justify your answer. [6]
Total available marks 40