Companies will many times organize their internal operations in a manner that suits the management style of the business owner or executive managers. Known as an organizational structure, it can vary widely by company and be simple or complex.
A simple organizational structure is common in small companies. The structure focuses around the owner, who is responsible to make decisions about business operations. Having one individual make decisions in a company also creates a centralized power structure.
In a simple organizational structure, decisions often occur quickly because owners and managers have knowledge about the entire business. Owners and managers can also choose what products to produce or the business relationships that will best advance the company’s mission.
Small businesses or other organizations operating under a simple organizational structure may find it difficult to run operations in absence of the owner or primary manager. Complex operations may also find it difficult to get timely feedback on decisions with this structure.