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Organisational Structure:

Organisational structure describes how tasks are formally separated, grouped & coordinated.  Managers required addressing the subsequent six key elements while they design their organisation's structure:

1  work specialisation;

2  departmentalisation;

3  chain of command;

4  span of control;

5  centralisation and decentralisation; and

6  formalisation.

Their elaboration is presented in table.

Table: Key Elements in the Design of Organisational Structure






Work Specialisation


Specifies degree to which tasks in the organisation are sub-divided into separate jobs. It is also known as the division of labour.




The primary on that jobs are grouped together.


Chain of Command


Refers to the unbroken line of authority which extends from the top of the organisation to the lowest echelon & clarifies who reports to whom.


Span of Control


Describes the number of subordinates a manager could efficiently & effectively direct.


Centralisation  and



Centralisation refers to the degree to that decision making is concentrated at a one point in the organisation. Decentralisation is the degree to that decision discretion is pushed down to lower level employees.




Specifies the degree to that jobs inside the organisation are standardised.

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