Lakhasly

A classification of people according to their relative authority and rank is called a hierarchy.Hierarchy is affected by: horizontal differentiation centralization versus decentralization differentiation versus integration standardization versus mutual adjustment the influence of the informal organizationThe shape of the hierarchy, plus the balance between centralization and decentralization, establish the extent of vertical differentiation.

A classification of people according to their relative authority and rank is called a hierarchy.

Determining the level of vertical differentiation is a basic design challenge. Managers must determine the shape of the hierarchy, the number of levels, and the span of control (the number of subordinates a manager oversees). The shape of the hierarchy, plus the balance between centralization and decentralization, establish the extent of vertical differentiation.

The shape of the hierarchy determines how decision making takes place. It also determines how motivated people will be to pursue organizational goals.

Hierarchy is affected by:
horizontal differentiation
centralization versus decentralization
differentiation versus integration
standardization versus mutual adjustment
the influence of the informal organization