- Organizational Charts: Organizational diagrams showing individual jobs, department structure, and chain of command.
- Structure: Depict enterprise structure
- Are used: For reorganization
To explain the inner workings of the business to new employees, customers, banks, etc.
- Display relationships among departments or employees: Who is responsible, for whom and for what
Shows superior/subordinate relationships
Workflow for intraorganizational communication
- Pros and Cons: of various business structures
- Modern Organizational Structure: Flat hierarchy, strongly decentralized decision-making, high level of autonomy in individual focus areas, increased scalability.
- Complex, highly compartmentalized structure: Employees tend to focus more on their own advancement than on the task at hand
- Consumer-Oriented Business: The customer is the driving force for all processes
- Choosing an Organizational Structure: A company's structure should be oriented toward its concrete position in the business world (size, age, growth, number of branches, business environment).
- Older and larger companies repeat successful behavior and formalize their processes
- Large enterprises have expanded coordination requirements
- The bigger the company, the larger the size of the average department
- The more dynamic the business environment is, the more organic and flexible the structure
- The more complex the business environment, the more decentralized the structure (flatter hierarchy)
- Example Organigram
- Comparison: of business structures
- No Structure: Startups and small businesses. Founder or owner is the boss
Highly fleximle, dynamic; can be overpowered by rapid growth
- Functional Structure: Divided by function: top management, production, marketing, sales and distribution
High level of specialization; very effictive for routine tasks
Difficult to coordinate the various functions; responsibility rests heavily on management
- Product-Oriented Structure: Structure of company is determined by product groups and business divisions
Clear responsibility for individual scope of activity
Management can concentrate on tasks that affect the company as a whole
Administration-intensive, highly susceptible to redundancy
- Geographical Structure: Directed at regional submarkets
Business strategy adapted to regional ideosyncracies
Clear picture of who is responsible for results
Requires additional levels of hierarchy, difficult to achieve corporate identity
- Holding Structure: Strongly diversified, multinational concerns
The parent organization focuses on few tasks, mostly administrative in nature
Allows spreading losses within the group, favorable financing opportunities
Little top-level expert knowledge, not synergistic, difficult to manage
