How to Compare & Contrast Organizational Structure

Organizational structure is a framework used by a company to divide its processes and activities needed to complete business operations. Most companies use a well-defined structure that lists management positions, and who is responsible for tasks and activities.

Types

Common types of organizational structures include functional, geographic, product and customer. Function creates a structure based on activity, geographic on location of businesses or department, product based on lines or items produced in groups and customer based on individual, business or government consumers.

Considerations

Companies may decide to use a matrix organizational structure, which combines one or more structure bases. For example, combining product and customer structures allows a company to manufacture and market specific goods or services for different customer types.

Effects

Organization structures will typically fall under a centralized or decentralized form. Centralized relies on one individual to make decisions while decentralized organizations will rely on several individuals for decisions.

References

• BusinessDictionary.com: Organizational Structure
• Reference for Business: Organizational Structure