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Section 
3
). We can see the 
strategic apex
(eg Board of Directors) 
at the top, through ranks of 
middle managers
to the 
operating core
where the work is done. 
Businesses may need to group employees into 
departments on some basis, which may involve choices 
as to the degree of centralisation needed (
Section 4
).
BPP Tutor Toolkit Copy

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PART B: BUSINESS ORGANISATION STRUCTURE, FUNCTIONS AND GOVERNANCE 
 
124
 
Study Guide 
Intellectual level
 
B1 The formal and informal business organisation 
 
 
(a) Explain the informal organisation and its relationship with the 
formal organisation. 
K 
(b) Describe the impact of the informal organisation on the 
business. 
K 
 
B2 Business organisation structure and design 
 
 
(a) Describe Mintzberg's components of the organisation and 
explain the different ways in which organisations may be 
structured:
(i) Entrepreneurial 
(ii) Functional 
(iii) Matrix 
(iv) Divisional: (geographical, by product, or by 
customer type) 
(v) Boundaryless: (virtual, hollow or modular) 
K 
(b) Explain basic organisational structure concepts: 
(I) 
Separation of ownership and management 
(II) Separation of direction and management 
(iii) Span of control and scalar chain 
(iv) Tall and flat organisations 
(v) Outsourcing and offshoring 
(vi) Shared services approach 
K 
(c) Explain the characteristics of the strategic, tactical and 
operational levels in the organisation in the context of the 
Anthony hierarchy. 
K 
(d) Explain centralisation and decentralisation and list their 
advantages and disadvantages. 
K