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  • A standard corporate structure consists of various departments that contribute

  • to the company's overall mission and goals. Common departments include

  • Marketing, Finance, Accounting, Human Resource, and IT. These five divisions

  • represent the major departments within a publicly traded company, though there

  • are often smaller departments within autonomous firms. There is typically a

  • CEO, and Board of Directors composed of the directors of each department. There

  • are also company presidents, vice presidents, and CFOs. There is a great

  • diversity in corporate forms as enterprises may range from single

  • company to multi-corporate conglomerate. The four main corporate structures are

  • Functional, Divisional, Geographic, and the Matrix. Realistically, most

  • corporations tend to have a “hybridstructure, which is a combination of

  • different models with one dominant strategy.

  • Importance The kind of differentiation and

  • diversity among corporations is of importance to corporate law. Choosing a

  • structure for a company is an important decision and must be strategically

  • thought out because it could either aid or harm the making of business. The

  • structure must also be a good fit for the type of activities, goals, and

  • vision of the company. The organizational structure is a reflection

  • of how convenient business is conducted. Models

  • = Functional structure = This model is commonly used in

  • single-program organizations. It is basically the standard structure

  • mentioned earlier, which is organized around departments. This structure is

  • most appropriate for small organizations.

  • = Divisional structure = Divisional structures are also called

  • product structures because they are based on a certain product or project.

  • This structure is most common in multi-service organizations. Normally,

  • It based on the departments divided in the firm.

  • = Geographic structure = Geographic structures are used in

  • multi-site organizations and are frequently used by networks across

  • different geographic areas. = Matrix structure =

  • The Matrix structure is probably the most complicated model of them all

  • because it is organized around multiple dimensions, typically with more than one

  • supervisor. This structure is commonly used in very large organizations because

  • a greater volume requires greater co-ordination. However, this structure

  • is very difficult to manage so it is usually better to reconsider its use and

  • replace it with a different type of structure, then compensate for the

  • tradeoffs. Classifications

  • In addition to those models, there are other factors that make up the structure

  • of an organization. Depending on the chain of command, a company's structure

  • could be classified as either vertical or horizontal, as well as centralized or

  • decentralized. A vertically structured organization or a "tall" company

  • describes a chain of management, usually with a CEO at the top delegating

  • authority to lower-level managers through mid-level managers. Horizontal

  • or "flat" companies, however, have almost no middle-managers, which implies

  • that high-level managers get involved in daily tasks and interact with customers

  • and front-line personnel. A centralized organizational structure describes how a

  • company's direction and decisions are set by one individual only.

  • Centralization compliments companies with "tall" structures to create

  • Bureaucratic organizations. Decentralized organizational structures

  • allow individuals some autonomy at each level of the business, because they join

  • the decision-making process. Evidently, classifying organizations as centralized

  • or decentralized is linked to them being "tall" or "flat".

  • Technology There is an emerging trend in the way

  • companies shape their organizational structures. More businesses are moving

  • towards a much flatter, decentralized organizational structure. Frank

  • Ostroff's "The Horizontal Organization", supports this new trend and asserts that

  • as globalization persists, companies will become more horizontal.

  • Technological developments accelerate these organizational changes as they

  • improve the efficiency of business, causing it to restructure departments,

  • modify position requirements, or add and remove jobs.

  • Books / authors / theorists Gareth Morgan's Images of Organization:

  • 6 metaphors Frank Ostroff's "The Horizontal

  • Organization" Henry Mintzberg

  • Peter Senge and the Learning Organization

  • Jay Galbraith's Star Model See also

  • Organizational Culture Organizational Design

  • Corporate Governance Management

  • Consulting Firms Non-profit Governing Boards

  • Board of directors Dual-listed company

  • Business model References

A standard corporate structure consists of various departments that contribute

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B1 UK structure organizational corporate company decentralized horizontal

Corporate structure

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    Alec posted on 2016/12/12
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