Organisation Charts and Effect on Communication

How Communication is affected by the Set up of a Company

In most business, the organisation chart of a company makes an impact of how the people in the business or company communicates. Some company set up encourages a two way communication between staff and management and they have open door policies.
On the other hand there are also companies where the communication between management and staff is literally "top down".
Organizational structure also " refers to the way people are organized ---the company's reporting structure."

This structure varies from company to company. "Tall" organizations use many layers of management. "Flat" organizations use fewer levels, and managers often have a wider span of control.

 

 

 

 Communication

• In companies with rigid structures, communication tends to follow reporting lines. In companies with flatter structures, communication may occur more easily across departments.
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• Organisation Charts

Organisation charts show how a  business is organised. It  shows the management hierarchy in a business and usually works from top down.
Hierarchy means the number of layers within an organisation.
Traditional organisations were tall with many layers of hierarchy and were often authoritarian in nature. With larger and taller structures, communication is difficult and has to travel through many layers of management to arrive at final decisions
Some examples are as below:

Tall Structures

Other taller ones:

 

The span of control is narrow and there are opportunities for promotion. Lines of communication are long, making the firm unresponsive to change.

 

Flat Organisation Chart for Small Businesses

A flat organization structure means that there are less layers of management between workers and top management. As a small business owner, has many advantages from such a lean structure, including improved communications. Communication within the  company is faster, easier and less prone to mistakes or misunderstandings. With a flat structure, your company can react to changes rapidly and spend less time with cumbersome and ineffective communications.

A wide span of control means that tasks must be delegated and managers can feel overstretched.

Centralised Organisation

In centralised organisations, the majority of decisions are taken by senior managers and then passed down the organisational hierarchy.

Businesses that have a centralised structure keep decision-making firmly at the top of the hierarchy (amongst the most senior management). 
Fast-food businesses like Burger King, Pizza Hut and McDonalds use a predominantly centralised structure to ensure that control is maintained over their many thousands of outlets.  The need to ensure consistency of customer experience and quality at every location is the main reason.

 

The main advantages and disadvantages of centralisation are:

Advantages	Disadvantages
Easier to implement common policies and practices for the business as a whole	More bureaucratic – often extra layers in the hierarchy
Prevents other parts of the business from becoming too independent	Local or junior managers are likely to much closer to customer needs
Easier to co-ordinate and control from the centre – e.g. with budgets	Lack of authority down the hierarchy may reduce manager motivation
Economies of scale and overhead savings easier to achieve	Customer service does not benefit from flexibility and speed in local decision-making
Greater use of specialisation
Quicker decision-making (usually) – easier to show strong leadership

Decentralised organisations 
Delegate authority down the chain of command, thus reducing the speed of decision making. Most large businesses necessarily involve a degree of decentralisation when it starts to operate from several locations or it adds new business units and markets.