Organizational Structure Types in Companies

Organizational Structure Types in Companies

by Kristie Lorette

http: //smallbusiness. chron. com/organizational-structure-types-companies-2791. html

Companies utilize organization structure to create their business hierarchies. Each company determines the staffing levels that it needs to operate efficiently, and organization structures play an important role in this determination. In addition to delineating company levels, organizational structures assign clear roles to departments and individuals to provide them with a sense of purpose and responsibility. While organizational structures can be unique to different companies, there are several distinct and commonly used types of organizational structures.

Functional Structure

Functional structure provides organization according to a job’s (or an individual’s) purpose within the organization. Functional organizations are most easily recognized by departments that focus on a single function or goal. For instance, an organization with a marketing department, a human resources department, a research and development department and so forth, operates according to functional organization. The functional structure provides employees, as well as their appropriate departments, with a clear objective and purpose for their work. In other words, employees within a marketing department know that their job is marketing and, as a result, those employees can focus on improving their marketing work and even specialize in a specific area of marketing. On the other hand, functional structure can create divisions between departments if a conflict develops between departments.

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