Vocabulary focus

Ex. 1. Match up the words on the left with the definitions on the right.

autonomous	a system of authority with different levels, one above the other
decentralization	a specific activity in a company, e.g. production, marketing, finance
function	independent, able to take decisions without consulting a higher authority
hierarchy	people working under someone else in a hierarchy
line authority	dividing an organization into decision-making units that are not centrally controlled
report to	the power to give instructions to people at the level below in the chain of command
subordinates	to be responsible to some one and to take instructions from him or her

COMPREHENSION

Ex. 1. Which of the following three paragraphs most accurately summarizes the text, and why?

First summary

Although most organizations are hierarchical, with a number of levels, and a line of command running from the top to the bottom, hierarchies should be avoided because they make decision-making slow and difficult. A solution to this problem is matrix management, which allows people from the traditional functional departments of production, finance, marketing, sales, etc. to work together in teams. Another solution is decentralization: the separation of the organization into competing autonomous divisions.

Second summary

Most business organizations have a hierarchy consisting of several levels and a clear line of command. There may also be staff positions that are not integrated into the hierarchy. The organization might also be divided into functional departments, such as production, finance, marketing, sales and personnel. Larger organizations are often further divided into autonomous divisions, each with its own functional sections. More recent organizational systems include matrix management and teams, both of which combine people from different functions and keep decision-making at lower levels.

Third summary

Most businesses are organized as hierarchies, with a clear chain of command: a boss who has subordinates, who in turn have their own subordinates, and so on. The hierarchy might be internally divided into functional departments. A company offering a large number of products or services might also be subdivided into autonomous divisions. Communication among divisions can be improved by the introduction of matrix management or teams.

Ex. 2. Read the text again and decide which of the following statements are correct.

1. Most organizations have a hierarchical or pyramidal structure, with one person or a group of people at the top, and an increasing number of people below them at each successive level.

2. Only some people in the organization know what decisions they are able to make, who their superior (or boss) is, and who their immediate subordinates are.

3. Some people in an organization have colleagues who help them. This is known as a staff position.

4. Most large manufacturing organizations have a functional structure, including (among others) production, finance, marketing, sales, and personnel or staff departments.

5. Functional organization is inefficient, because people are usually more concerned with the success of their department than that of the company, so there are permanent battles between, for example, finance and marketing, or marketing and production, which have incompatible goals.

6. Secondly, separating functions is unlikely to encourage innovation.

7. An inherent problem of hierarchies is that people at lower levels are able to make important decisions, but have to pass on responsibility to their boss.

8. One solution to this is matrix management, in which people report to more than one superior.

Ex. 3. This is an example of part of a company organization chart:

After studying the chart you are required to answer the following questions:

1. Who do the Marketing Director, the Production Manager, the Financial Director (in other words the Departmental Heads) take their orders from?

2. If the Managing Director and the Production Manager had a meeting, what do you think they might discuss?

3. Who do Market Research, Sales and Advertising Managers take orders from?

Ex. 4. The most common verbs for describing structure are:

consists of contains includes

is composed of is made up of is divided into

e g. The company consists of five main departments. The marketing department is made up of three units. The sales department is divided into two sections.

Other verbs frequently used to describe company organization include:

to be in charge of to be responsible for

to support or to be supported by to assist or to be assisted by

to be accountable to

e g. The marketing department is in charge of the sales force.

The marketing department is responsible for advertising, sales promotions and market research.

The five department heads are accountable to the Managing Director.

Now write a description of either the organization chart above, or a company you know, in about 100-150 words.

One successful sales company had a unique organization layout. At the top of the chart was the most important person in the whole operation-the customer. This labeled “customer” was linked with lines to boxes of functions dealing directly with the customer-sales person, technical service, order clerk, credit clerk, etc. Try to draw your own organization chart, starting with the customer.

T E X T 3

Read the text. Answer the following questions.

1. Does the board of directors make mostly strategic or tactical decisions?

2. Are there any advantages of the situation that part-time directors can be elected to the board?