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Organizational Structures for Your Business

Many argue that out of the many demands and difficulties that come with running a business, the most difficult task is deciding how your team should be structured in the best possible way to achieve your strategic objectives. Organizational structure doesn’t just happen whimsically. It is an endeavor that mandates deliberate planning, consistent management and regular review. One might look at it and say, “I’d rather focus on my marketing” or “The product needs to be released soon”. Alas, it is important to figure out how your team will work together to ensure that everyone communicates effectively and that the final desired outcome is achieved.

What is organizational structure?

According to Investopedia, “organizational structure is a system that outlines how certain activities are directed in order to achieve the goals of an organization. These activities can include rules, roles, and responsibilities. The organizational structure also determines how information flows between levels within the company.” It can be as simple as having a hierarchal line of communication where junior staff reports to the project manager, and in turn the project manager goes over key information with the company CEO. As a startup entrepreneur, it may be difficult to design company’s structure because you may either be running the business alone, or you may have only 2 people in your team. In such cases, it can be tempting to just send a text to your co-worker about client information or chat about it over lunch. The balancing act of a startup entrepreneur is to operate idealistically like you’re already a listed company on the stock exchange, while keeping your feet on the ground to manage the day-to-day activities of the business. Organize your team as if you are already at the pinnacle of success. Here’s a list of work structures currently used in many organizations. Have a look at all of them and then proceed to think about which one is most practical for your business and your team:

Functional Structure

Implementing a functional work structure entails ensuring that staff members are ins specialized departments such as production, marketing, finance, HR, just to name a few. It is based on the economies of scale achieved by the division of labor is the most popular organizational structure used in businesses, especially, SMME’s

Divisional Structure

Divisional organizational structure splits employees into segments that correspond to particular products, services or markets, explains Each division enjoys some degree of autonomy, complete with functional units such as operations, personnel, marketing and research and development departments designed to focus on particular markets and product lines. This organizational structure is suitable for businesses that operate chain stores and subsidiaries within the country and internationally.

Matrix Structure

A matrix organizational structure is one in which employees report to two or more managers rather than one manager overseeing every aspect of a project. For example, an employee may have a primary manager they report to as well as one or more project managers they work under. This type of structure is often useful when skills need to be shared across departments to complete a task and can allow companies to utilize a wide range of talents and strengths.

Virtual Teams Structure

Perhaps this work structure has grown the most in this past year due to the pandemic. Many companies have opted to have their employees work from home and in doing so, teams have become virtual. The biggest thing about working in a virtual is ensuring that communication is optimized. Increased use of project management software, emails, groups, tools like Slack and others must be used to ensure that teams communicate virtually. Virtual teams also often work in a company that expects all individuals to be self-enterprising not to be micro-managed.

These are just a few of the organization structures you can choose from as you manage your staff. look at how your company wants to achieve its strategic objectives, and then proceed to organize a team that facilitates the achievement of those objectives.


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