Typically, instructions are passed down the
hierarchy; information, for example about sales or output levels, is sent
upwards. The taller the organisational structure, the longer will be the chain
of command – slowing down communications. In other words, chain of command is
the route through which authority is passed down an organisation – from the
chief executive and the board of directors.
There are two types
of organisational structures; organisational and matrix structure. Organisational structure is the
internal framework of a firm that shows the way in which management is
organised and linked together and how authority is passed through the organization,
whilst Matrix Structure is an
organisational structure that creates project teams that cut across traditional
In this case, Amazon’s
organizational structure can be classified as hierarchical.
is one where there are different layers of the organisation with fewer and
fewer people on each higher level – the figure of organisational structure
demonstrates this. In general terms it is often presented as a pyramid (A
typical hierarchical pyramid).
team include two CEOs, three Senior Vice Presidents and one Worldwide
Controller, who are responsible for various vital aspects of the business
reporting directly to Amazon CEO Jeff Bezos. There are seven segments such as
information technology, human resources and legal operations and heads of
segments also report to Amazon CEO.
As the company has a hierarchical/bureaucratic structure,
nevertheless, it remains highly flexible to adapt to frequent changes in the
external marketplace. Amazon organizational culture, on the other hand, are
based on the principles of high level of cost-consciousness, constant
reinvention and improvement of organizational culture and customer obsession.
In the organisational structure above, amazon has a
narrow span of control of four ? this is likely to lead to close control of
subordinates. This is a tall organisational structure.
organizational structure is
one which has many levels of hierarchy. In these tall organisation structures,
there are many managers, and each manager has a small span of control – they
are in charge of only a small group of people.
Tall hierarchical structures have communication and
employee motivation problems. One conclusion many senior managers have come to
is to remove whole layers of management to create shorter structures. This is
process is known as delayering.
Delayering is removal of one or more of the levels
of hierarchy from an organisational structures.
Angeles Police Department
The Above diagram is
the hierarchy of LAPD.
In this case, LAPD is a organisational/bureaucratic
structure as well. But the only difference here is that this structure includes
a tall and a flat organisational structure.
A flat organization (also known as horizontal organization or
delayering) has an organizational structure with few or no
levels of middle management between staff and executives.
of hierarchical structure
Many businesses are still organised in this way as
decision-making power starts at the top, but may be passed down to lower
levels. The vertical divisions do not have to be based on functional
departments – they could be based on region or country or product category, for
example consumer goods and industrial goods. The rungs on the career ladder for
a keen and ambitious employee are illustrated by the different levels of
hierarchy. The role of each individual will be clear and well-defined. There is
a clearly identifiable chain of command.
This traditional hierarchy is most frequently used by organizations based on a
‘role culture’, where the importance
of the role determines the position in the hierarchy.
of hierarchical structure
Such a structure tends to suggest that one-way (top
downwards) communication is the norm – this is rarely the most efficient form.
There are few horizontal links between the departments or the separate
divisions, and this can lead to lack of coordination between them. Managers are
often accused of tunnel vision because they are not encouraged to look at
problems in any way other than through the eyes of their own department. This
type of structure is very inflexible and often leads to change resistance. This
is because all managers tend to be defending both their own position in the
hierarchy and the importance of their own department.