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ACCA Applied Knowledge · Business and Technology · Business organisational structure

Which of the following is a typical disadvantage of a bureaucratic structure operating in a rapidly changing market?

The typical disadvantage is that rigid rules, procedures and hierarchy make a bureaucracy slow and inflexible when the market changes. Overload of a single owner, dual reporting and duplicated functions are weaknesses of entrepreneurial, matrix and divisional structures respectively, not of bureaucracy.

  1. ADecisions are concentrated in one owner-manager who becomes overloaded
  2. BEmployees report to two managers, causing role confusion
  3. CRigid rules and procedures make it slow to respond to changeCorrect
  4. DAutonomous divisions duplicate head office functions

Explanation

Bureaucracies depend on formal rules, hierarchy and standard procedures, which give consistency but reduce flexibility and slow adaptation in changing markets. Owner overload relates to entrepreneurial structures, dual reporting to matrix structures, and duplication to divisional structures.

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