Organizational Structure

An organizational structure is the way that specific goals or achievements are organized in order to accomplish them. They are used in a wide range of different situations. Most people are familiar with managerial organizational structures, which outline how various teams and employees report to their management in the company. This structure typically starts with front line employees at the bottom, then has supervisors, department managers, organizational leaders, and finally the CEO. While this is certainly a common example of an organization structure, it is not the only one.

Other Types of Organizational Structures

Choosing the right type of organizational structure for a given situation is very important. When done properly it can help to identify where decisions need to be made, the responsibilities people have, and much more. Some of the types of organizational structures to be aware of include:

  • Centralization – This identifies where decisions will be made. The people or departments that contribute to a decision would roll up into the ultimate decision maker for a given task or topic.
  • Product Based – This is where the structure is determined based on each product or group of products made by a company.
  • Market Based – The structure here is determined by the market involved. This could be a geographic market, or a type of customer (commercial, residential, etc).
  • Process Based – This organizational structure is based on the types of processes that need to be completed. Examples of points in the structure would be things like marketing, research, order fulfillment, etc.

There can be quite a large number of different types of organizational structures. In some companies it is even necessary to have multiple in place to properly determine responsibilities. As long as everyone involved is aware of how the organizational structure is made up, and where they can see it, the structure should function properly.


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