In a hierarchical organisation employees are ranked at various levels within the organisation, each level is one above the other. At each stage in the chain, one person has a number of workers directly under them, within their span of control. A tall hierarchical organisation has many levels and a flat hierarchical organisation will only have a few. In a traditional hierarchy, senior managers make up the board of directors and are responsible for establishing strategy and overall business direction, whilst middle managers have responsibility for a specific function such as finance or marketing.
A traditional hierarchical structure clearly defines each employee’s role within the organisation and defines the nature of their relationship with other employees. Hierarchical organisations are often tall with narrow spans of control, which gets wider as we move down the structure. They are often centralised with the most important decisions being taken by senior management.
In the twentieth century as organisations grow bigger, hierarchical organisations were popular because they could ensure command and control of the organisation. However with the advent of globalisation and widespread use of technology, in the 1990’s tall hierarchical organisations began to downsize and reduce their workforce. Technology was able to carry out many of the functions previously carried out by humans.
Advantages of Hierarchical OrganisationsAuthority and responsibility and clearly definedClearly defined promotion path.There are specialists managers and the hierarchical environment encourages the effective use of specialist managers. Employees very loyal to their department within the organisation.
Disadvantages of Hierarchical Organisations The organisation can be bureaucratic and respond slowly to changing customer needs and the market within which the organisation operates. Communication across various sections can be poor especially horizontal communication. Departments can make decisions which benefit them rather than the business as a whole especially if there is Inter-departmental rivalry.
There are many huge corporations. They are successful in many ways, measured by various methods, such as the revenue they have earned, their longevity, and their impact in business world. Here are the Top 10 lists according to some of the most common criteria.
Currently the top earners worldwide are:Wal-Mart Stores established in 1962 by Samuel Walton, their revenue is at $421,849,000,000 Wal-Mart Stores, Inc., branded as Walmart, is an American multinational retailer corporation that runs chains of large discount department stores and warehouse stores. The company is the world’s third largest public corporation, according to the Fortune Global 500 list in 2012. It is also the biggest private employer in the world with over two million employees, and is the largest retailer in the world. Іt is also one of the world’s most valuable companies.
The company was founded by Sam Walton in 1962. Walmart has 8,500 stores in 15 countries, under 55 different names. Exxon Mobil while it was only formed in 1999 this company is a direct descendant of John D. Rockefeller and their revenue is at $364,035,000,000. Exxon Mobil Corporation is an American multinational oil and gas corporation. It is a direct descendant of John D. Rockefeller’s Standard Oil company and was formed on November 30, 1999.
The company is ranked #1 globally in Forbes Global 2000 list in 2012. A 2012 article in The Daily Telegraph says that ExxonMobil has “grown into one of the planet’s most hated corporations, able to determine American foreign policy and the fate of entire nations“ because this company is very dangerous for environment. Royal Dutch Shell established in 1907, their revenue is $368,056,000,000. Royal Dutch Shell, commonly known as Shell, is an Anglo–Dutch multinational oil and gas company headquartered in the Netherlands and with its registered office in London. It is one of the six oil and gas “supermajors”. Shell is also one of the world’s most valuable companies.
Shell is vertically integrated and is active in every area of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading. It also has major renewable energy activities, including in biofuels, hydrogen, solar and wind power. It has operations in over 90 countries, produces around 3.1 million barrels of oil equivalent per day and has 44,000 service stations worldwide. BP their revenue is at $297,107,000,000.
BP is a British multinational oil and gas company headquartered in London. It is vertically integrated and operates in all areas of the oil and gas industry, including exploration and production, refining, distribution and marketing, petrochemicals, power generation and trading. It also has renewable energy activities in biofuels and wind power.
BP has operations in over 80 countries, produces around 3.4 million barrels of oil equivalent per day and has around 21,800 service stations worldwide. Its largest division is BP America, which is the second-largest producer of oil and gas in the United States. BP has been involved in several major environmental and safety incidents, including the 2010 Deepwater Horizon oil spill, the world’s largest accidental release of oil into marine waters. Sinopec their revenue is at $289,774,000,000.
China Petroleum & Chemical Corporation or Sinopec Limited is a Chinese oil and gas company based in Beijing, China. Sinopec Limited’s parent, Sinopec Group, is one of the major petroleum companies in China, headquartered in Beijing. Sinopec’s business includes oil and gas exploration, refining, and marketing; production and sales of petrochemicals, chemical fibers, chemical fertilizers, and other chemical products; storage and pipeline transportation of crude oil and natural gas; import, export and import/export agency business of crude oil, natural gas, refined oil products, petrochemicals, and other chemicals.