Hierarchical Structures

Exam code: 7115

Written by: Ashika|Reviewed by: Caroline Carroll|Updated 2 July 2026

An organisational chart is a visual representation of the reporting relationships, roles and responsibilities of employees in an organisation
- Businesses must determine what the best structure is for them so as to effectively implement ideas and achieve their objectives
  - They should consider how the structure may affect the management and effectiveness of operations and communications
  - A well-designed organisational structure helps to promote clarity, efficiency and accountability

The chain of command is the formal line of authority that flows downward from the top management to lower-level employees
- It defines who reports to whom and who is responsible for making decisions
- The chain of command helps to establish a clear communication channel and helps to maintain accountability within the organisation

Span of control refers to the number of employees that a manager or supervisor can effectively manage
It is based on the principle that a manager can only effectively manage a limited number of employees
- A narrower span of control means that there are more layers of management
- A wider span of control means that there are fewer layers of management

The chain of command and span of control are closely linked
- A long chain of command usually results in a narrow span of control
  - This is known as a tall organisational structure
- A short chain of command usually results in a wide span of control
  - This is known as a flat organisational structure

Multiple levels of management
A long chain of command and narrow span of control
Common in large organisations with complex operations
- E.g. government agencies and universities

Advantages	Disadvantages
Provides a clear hierarchy of authority and defined roles and responsibilities Promotes specialisation and expertise within each department or function	Can create communication barriers between upper and lower levels of the hierarchy Decision-making can be slow as information must pass through multiple layers of management

Fewer levels of management
A short chain of command and wide span of control
Common in small organisations or start-ups
- E.g. technology start-ups and small businesses

Advantages	Disadvantages
Promotes a culture of collaboration and open communication Decision-making can be faster and more efficient	Can lead to a lack of clear hierarchy May require employees to take on multiple roles and responsibilities leading to burnout and feeling overwhelmed

Organisational charts