Association of Chartered Certified Accountants (ACCA) Certification Practice Test

Which concept refers to the number of management levels within an organization?

1. Span of control

2. Scalar chain

3. Organizational hierarchy

4. Decision-making level

The correct answer is: Scalar chain

The concept that refers to the number of management levels within an organization is best described by the scalar chain. This term emphasizes the vertical chain of command that establishes hierarchy and reporting relationships among different management levels in an organization. It delineates how tasks and responsibilities are allocated and how communication flows from top management down to lower levels of the organization. The scalar chain highlights the structure through which authority and accountability are communicated, illustrating how many tiers of management exist. This is crucial for understanding operational efficiency, accountability, and clarity within an organization as each level in the chain has specific responsibilities and decision-making authority. In contrast, span of control refers to how many subordinates a manager can supervise effectively, which impacts the breadth of their oversight rather than the number of levels. Organizational hierarchy broadly identifies the arrangement of roles and the relationships between different job levels but does not specifically quantify the number of management levels. Decision-making level relates to the authority for making choices within the organization but does not specifically address the hierarchy and structure of management levels.