Lesson 1.3.3

1.3.3 Restructuring Quiz: NCFE Business & Enterprise, Unit 1

20 questions

Written by Revision Ninja · Last reviewed 11 October 2026

In partnership with Revision Ninja

Businesses change their structure as they grow, merge or cut costs. This lesson covers delayering, reorganisation, redundancy and restructuring around growth or new markets, explaining the savings and faster communication they can bring alongside lost experience, heavier workloads and immediate redundancy bills.

Key points

  • Delayering removes a whole tier of the hierarchy, usually middle managers, which shortens the chain of command.
  • After delayering, remaining managers supervise more people, so workloads rise and support for each worker can fall.
  • Redundancy happens when a job no longer exists, which is different from dismissal for poor conduct or capability.
  • Redundancy pay is a one-off cost that must be paid at once, while wage savings build up over later years.
  • A merger can leave duplicate departments, so reorganising removes repeated roles and cuts cost.
  • Growth from a handful of staff to many makes one owner's supervision impossible, so teams and managers are created.
  • A firm trading in several regions may set up regional divisions so decisions are taken near each local market.

Key terms

Restructuring
Changing how a business is organised, such as its levels, teams or reporting lines.
Delayering
Taking out a layer of management from the hierarchy.
Redundancy
Losing a job because the role is no longer needed, not because of the worker's performance.
Reorganisation
Rearranging who sits where and who reports to whom without necessarily cutting jobs.
Merger
Two firms joining together, often leaving duplicated departments to combine.
Regional division
A part of a business that handles one geographical area with its own laws and customer tastes.

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The 20 questions

  1. A business removes an entire tier of middle managers from its hierarchy. What is this change called?

    • Delegation
    • Centralisation
    • Outsourcing
    • Delayering

  2. What does it mean when an employee is made redundant?

    • Promoted to senior manager
    • Resigned for another job
    • Fired for gross misconduct
    • Job no longer exists

  3. Why do merged businesses often reorganise departments?

    • To increase wage bills
    • To cut duplicated roles
    • To slow down output
    • To complicate reporting

  4. What is a direct advantage of delayering an organisation?

    • Faster communication
    • More management layers
    • Higher overheads
    • Narrower spans

  5. What is a genuine drawback of delayering a business?

    • Loss of experience
    • Slower communication
    • Shorter chains
    • Lower wage costs

  6. What is a financial advantage of making staff redundant?

    • More managers
    • Lower wage bills
    • Zero upfront costs
    • Higher revenues

  7. What is the main immediate financial cost of making staff redundant?

    • Redundancy pay
    • Future wages
    • Marketing costs
    • Training fees

  8. Which span of control issue typically forces a growing small firm to restructure?

    • Too many managers
    • Span too wide
    • Staff turnover high
    • Span too narrow

  9. What must a sole trader start doing when taking on their first employees?

    • Issue shares
    • Delegate work
    • Form limited company
    • Pay corporation tax

  10. How does a UK firm usually reorganise when selling across Europe and Asia?

    • Functional hierarchy
    • Product departments
    • Regional divisions
    • Flat structure

  11. What does delayering mean in a business hierarchy?

    • Hiring more staff
    • Increasing pay grades
    • Opening new branches
    • Removing a management layer

  12. What happens to specific worker positions during redundancy?

    • Staff receive promotions
    • Roles become permanent
    • Salaries double immediately
    • Jobs disappear

  13. Moving online staff from IT into the sales team is an example of what?

    • Liquidation
    • Delayering
    • Privatisation
    • Reorganisation

  14. What is a key advantage of delayering for a business?

    • Wider spans
    • Faster communication
    • Higher costs
    • More managers

  15. What is a main drawback of delayering for remaining managers?

    • Lower salary
    • Slower promotion
    • Wider span of control
    • Fewer subordinates

  16. Why can cutting jobs save money over the long term?

    • Increased training fees
    • Higher redundancy costs
    • More overtime needed
    • Lower wage bill

  17. Which cash outflow hits a firm straight away when making redundancies?

    • Unpaid utility bills
    • Annual business rates
    • Redundancy pay
    • Future pension contributions

  18. What is the key difference between redundancy and dismissal?

    • Voluntary resignation
    • Employee misconduct
    • Role no longer needed
    • Poor performance

  19. Why might a growing business introduce specialist teams?

    • Increased business size
    • Reduced output
    • Lower sales
    • Fewer employees

  20. How does structure change when a sole trader takes on staff?

    • Partnership created
    • Operations closed
    • Flat structure kept
    • Hierarchical teams formed

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