Definition
The typically hierarchical arrangement of lines of authority, communications, rights and duties of an organization. Organizational structure determines how the roles, power and responsibilities are assigned, controlled, and coordinated, and how information flows between the different levels of management.
A structure depends on the organization's objectives and strategy. In a centralized structure, the top layer of management has most of the decision making power and has tight control over departments and divisions.
A decentralized structure, the decision making power is distributed and the departments and divisions may have different degrees of independence. A company such as Proctor & Gamble that sells multiple products may organize their structure so that groups are divided according to each product and depending on geographical area as well.
An organizational chart illustrates the organizational structure.
Use this term in a sentence
1. Having a good organizational structure will lead to much better decisions by your business for its long term investment goals.
2. My buddy did not want to work on Saturday, but he complained to the plant manager instead of our department supervisor, completely ignoring the organizational structure of our company.
3. Before the man began working at his new job, he wanted to know the organizational structure and who was in charge.
4. The organization and coordination of the activities of a business in order to achieve defined objectives.
5. Management is often included as a factor of production along with? machines, materials, and money. According to the management guru Peter Drucker (1909-2005), the basic task of management includes both marketing and innovation. Practice of modern management originates from the 16th century study of low-efficiency and failures of certain enterprises
6. Management consists of the interlocking functions of creating corporate policy and organizing, planning, controlling, and directing an organization's resources in order to achieve the objectives of that policy.
7. The directors and managers who have the power and responsibility to make decisions and oversee an enterprise.
The size of management can range from one person in a small organization to hundreds or thousands of managers in multinational companies. In large organizations, the board of directors defines the policy which is then carried out by the chief executive officer, or CEO. Some people agree that in order to evaluate a company's current and future worth, the most important factors are the quality and experience of the managers.