Page 93 - Cambridge IGCSE Business Studies

7: Organisation and management

Figure 7.3 Organisation
chart as a pyramid

91

ACTIVITY 7.1

Use Figure 7.2 to identify two other individuals who have the same status in the organisational structure, but who are not
the same status as the Factory Manager.

KEY TERM Chain of command
As a business grows it will employ more and more workers. It will not be possible for
Chain of command: the route the person at the top to have effective control of all workers. The day-to-day control

through which authority is passed
of workers becomes the responsibility of managers lower down the hierarchy. Th e
down through an organisation.
term chain of command describes the route through which authority is passed
down to these managers from the top. Each person in the chain of command is
directly responsible to the person immediately above them and directly responsible
for the person(s) directly below them. In Figure 7.2 the Accountant is directly
responsible to the Finance Director.

ACTIVITY 7.2

Using Figure 7.2, which of the following statements is correct?

1 The recruitment manager is directly responsible to the recruitment administrator.
2 The recruitment manager is directly responsible for the Human Resources Director.
3 The recruitment administrator is directly responsible to the Human Resources Director.
4 The recruitment manger is directly responsible to the Human Resources Director.