What is Organizational Structure of Management_

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What Is Organizational Structure of Management? - Types,Examples & QuizSupplemental Lesson

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In this lesson, we will provide an overview of the dierent types of organizationalstructures a company can utilize. Read on to learn why having an organizationalstructure is important.

We also recommend watching Types of Internal Organizational Change: Structural,Strategic, People, and Process (/academy/lesson/organizational-change-causes-types-challenges-for-managers.html) and Managerial Challenges Caused by OrganizationalChange (/academy/lesson/managerial-challenges-caused-by-organizational-change.html)

Organizational Structure of ManagementAn organization's structure lays out the foundation for how the company operates. Inother words, it sets the routine for the organization. The structure determines howdecisions are made and implemented through every part of the organization. It has todo with how the company organizes and delegates tasks and responsibilities.

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There are a variety of organizational structures that can be used. Some commonexamples include at organizational structure, functional organizationalstructure, product organizational structure, and geographical organizationalstructure. Let's take a look at these four structures in more detail.

Flat Organizational StructureA at organizational structure is often used for a small company with 20 or feweremployees. This type of structure has very few levels of management between theChief Executive Ocer (CEO)/president and the lower level employees. In this type ofstructure, decisions can be made quickly due to the fact there are only a few levels ofmanagement. Here is an example of what a at organizational structure looks like:

Functional OrganizationalStructureAnother type is the functionalorganizational structure. This type ofstructure is focused on job functions orfunctional areas. Companies use this typeof structure when they want to arrangetheir organization by department. In this type of structure, employees with sharedskills and knowledge are grouped together. Here is an example of what a functionalorganizational structure looks like:

Product OrganizationalStructureAnother common type of organizationalstructure - the product organizationalstructure - is focused on the company'sproduct lines. This type of structure cantypically be found in retail stores that arein multiple cities. Since this type ofstructure can be spread out into dierent

cities, there may be a need to have a marketing, operations, and nance departmentin each city.



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