Association of Chartered Certified Accountants (ACCA) Certification Practice Test

Which of the following is a disadvantage of flat organizations?

1. Improved control over operations

2. Superficial understanding by managers

3. Increased management levels

4. Higher job diversity

The correct answer is: Superficial understanding by managers

In a flat organization, there are fewer hierarchical levels between management and staff, which can lead to a situation where managers may have a superficial understanding of the tasks and responsibilities of their team members. This reduced hierarchy might limit managers' ability to engage deeply with the complexities of individual roles, as they are often spread thin over a broad range of responsibilities, having to oversee various functions without the benefit of specialized layers of management. When organizations are flatter, the breadth of duties assigned to each manager can lead to a more generalized understanding of employee tasks rather than an in-depth knowledge of each role. This superficial knowledge can impede effective decision-making, problem-solving, and tailored support for employees, as there might be less time for managers to devote to learning about each specific area of their team's work. Thus, this characteristic can be seen as a disadvantage, as it may undermine effective leadership and operational effectiveness within the organization.