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Vertical differentiation

This term refers to the number of management levels in a company. A company with many levels is known as a “tall” company. It looks like this:

Traditional manufacturing companies are “tall” organizations. There are many levels in the hierarchy, because there are many different production processes. Other examples of “tall” organizations include government bureaucracies and military organizations.

This kind of organization is difficult to control, and the lower levels in the hierarchy usually have to obey very precise rules, rather than plan their own work.

Jeremy Fitzerald, Management, Black Cat Publishing, 2001, p. 47-57

Reading comprehension

Lexical exercises

I. Complete the sentences below with the correct word from the following:

resource authority tall informal flat

horizontal formal objective structure vertical

  1. A business organization consists of a group of people who form a ………………. .

  2. A business organization has rules and ……….. .

  3. A business organization follows a set of …………… .

  4. A company uses economic ………….. .

  5. The division of a company’s activities into different units is called …....... differentiation.

  6. The number of management levels in a company is called ………. differentiation.

  7. A …………….. organization has very few management levels.

  8. A …………….. organization has a lot of management levels.

  9. An organization with a stated purpose or objective is called a ……….. organization.

  10. An …………. Organization does not exist to meet formal objectives.

II. The words below all come from the text. Use your dictionary to complete the chart to show the different forms of each word.

Noun

Verb

Adverb

Adjective

organizational

financially

market

user

manage

----------------

---------------

controllably

formal

structurally

employ

-----------

------------

power

Listening

You are going to hear two people who work in “tall” organizations talking about their job. Listen carefully to what they say, and answer the questions that follow.

Speaker 1

  1. What is the speaker’s job?

  2. What makes the job challenging and interesting?

  3. Does the speaker make a lot of decisions?

Speaker 2

  1. What is the speaker’s job?

  2. Why is he disappointed in the job?

Case study

I. Read the text for general understanding. Types of companies in the usa and Great Britain