Types of organisational structure

Different types of organisational structure exist in the corporate world of today. Organisational structure is not just a mere structure of the employees, sub ordinates and super ordinates but it also shows the flow of information through an organisation.  The hierarchy of an organisational structure vary from organisation to organisation. Some different types of organisational structures with a brief description are:

Functional Structure:
Functional structure is one of the most widely adapted structures in the organisations today. In functional structure, different group of employees are grouped together depending on their function or role in the organisation.  An example can be taken of an organisation which has different departments such as Marketing department, IT department, Sales department, Production department, Customer Service department etc. So the employees related to production will be under Production department, employees related to marketing will be under marketing department and so on. The functional structure is regarded as the best setting for relatively small or medium sized organisations. In such a structure, each department is autonomous and keenly rely on the talent and throughput of their employee in order to contribute in the overall production of an organisation. The issues in such an environment are normally dealt internally within the department. The main drawback of such a structure is that it limits the communication within the department due to the organisational boundaries thus leaving each department to work in isolation.

Divisional Structure:
The second type of organisational structure is the divisional structure which is a well suited setting for relatively large scale organisations. Especially those large scale companies whose departments are mostly geographically apart from each other. The separation of the organisation can be within the country or even internationally. An example can be given of a large scale import-export company where different sections of the country operate globally in different countries dealing with separate goods particular in that country.  The idea behind such an organisational structure is that the needs and requirements of the organisation are more closely analysed and addressed. The turnaround time and the productivity both get efficient which otherwise wouldn’t be possible in any other organisational structure. Communication is such a structure is again a problem as different divisions operate in isolation and a good geographical distance between them. Another disadvantage of such a structure is that its setting up cost is expensive due to the larger size and scope it has.

Matrix Structure:
The most innovative, yet the most effective organisational structure is the matrix structure. This structure basically is the hybrid combination of both the functional and divisional structure. This structure is mainly adapted in typical large scale multination companies of today. The idea here is to take the best of both functional and divisional structures in to one organisation. The drawback here is related to power management as the structure is such organised that it leads to dual management. It has several managers working in the same area and also sometimes at the same managerial level.