Factors affecting organisational structure
A Forestry Commission case study

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Page 2: Organisational structure

Organisational structure refers to the way that roles are organised within a firm. The structure is often represented in a diagram called an organisation chart. Many organisations are typically set up in a hierarchical structure. This is where workers are divided into management layers, with those in the top levels having greater authority than those in lower levels. Instructions are passed down through the layers along the chain of command. An organisation's structure should be designed to deliver goals and use resources in the best possible way.

Organisations may be structured by product, function or geography. Department stores, for example, are structured by product, e.g. menswear, cosmetics, home wares. UK government departments are structured by function, for example, Health or Education.

The Board of Commissioners is responsible for overseeing the work of the Forestry Commission across Great Britain as a whole. However, there are national committees for each of Scotland, England and Wales. The Forestry Commission therefore is structured by geography.

This geographical structure has two main advantages. Firstly, it creates a regional base allowing decisions in Scotland, Wales and England to be made and managed at a regional level. This takes into account local conditions, needs and expertise.

Delegating decision-making down the hierarchy is referred to as decentralisation. Each country is engaged in:

  • Forest management activities on the government's forest estate, such as planting and harvesting trees, recreation or education
  • Conservation activities for the protection and re-planting of trees and nature sites owned by private sector landowners.

The Forestry Commission's structure also allows it to benefit from centralisation. While forest policy differs between the three countries, some internal policy decisions are still made at the top of the hierarchy. This ensures consistency where necessary throughout the whole of the Forestry Commission, for example, making certain that Britain adheres to international rules for sustainable forest management.

Centralisation also provides benefits from economies of scale, e.g. by having central departments to provide shared services, including Human Resources, Finance and Information Services.

Forestry Commission | Factors affecting organisational structure