Sky Dry Incorporated has over a dozen levels of management, and each manager is responsible for overseeing an average of three subordinates. Mountain Light Corporation has three levels of management, and each manager is responsible for overseeing an average of twenty subordinates. Classify Sky Dry and Mountain Light as having a tall or flat organizational structure, and explain why. State at least two disadvantages of tall organizational structures.

Question

What will be an ideal response?

Answer 1

Student answers will vary but should demonstrate understanding of flat and tall organizational structures. A sample answer follows.

A tall organizational structure has many hierarchy levels and a narrow span of control, while a flat organizational structure has few levels and a wide span of control. Some of the disadvantages of tall organizations are as follows:
More layers of management means having to pay more management salaries. 
Communication in the organization becomes more complex as each new layer becomes one more point through which information must pass when traveling upward or downward. 
The organization's ability to make decisions becomes slower because approval for decisions has to be authorized at every step of the hierarchy. 
Sky Dry has a tall structure because there are many levels of management, and each manager has a small number of subordinates, or a narrow span of control. Mountain Light has a flat structure because there are few levels of management, and each manager has a large number of subordinates, or a wide span of control. Tall organizations have to pay more managers, and decision-making becomes slower and more complex in tall organizations.