Type of Organizational structures

Introduction
Every organization to be effective must have an organizational structure. But what is an organizational structure? It is the form of structure that determines the hierarchy and the reporting structure in the organization. It is also called organizational chart. There are different types of organization structures that companies follow depending on a variety of things; it can be based on geographical regions, products or hierarchy. To put it simply an organizational structure is a plan that shows the organization of work and the systematic arrangement of work.

Types of Organizational Structures
There are different types of organizational structures and a company should choose the one that best suits their needs.

Traditional Structures
These are the structures that are based on functional division and departments. These are the kind of structures that follow the organization’s rules and procedures to the T. they are characterized by having precise authority lines for all levels in the management. Under types of structures under traditional structures are:

• Line Structure – this is the kind of structure that has a very specific line of command. The approvals and orders in this kind of structure come from top to bottom in a line. Hence the name line structure. This kind of structure is suitable for smaller organizations like small accounting firms and law offices. This is the sort of structure that allows for easy decision making, and also very informal in nature. They have fewer departments, which makes the entire organization a very decentralized one.
• Line and Staff Structure – though line structure is suitable for most organizations, especially small ones, it is not effective for larger companies. This is where the line and staff organizational structure comes into play. Line and structure combines the line structure where information and approvals come from top to bottom, with staff departments for support and specialization. Line and staff organizational structures are more centralized. Managers of line and staff have authority over their subordinates, but staff managers have no authority over line managers and their subordinates. The decision making process becomes slower in this type of organizational structure because of the layers and guidelines that are typical to it, and lets not forget the formality involved.
• Functional structure – this kind of organizational structure classifies people according to the function they perform in their professional life or according to the functions performed by them in the organization. The organization chart for a functional based organization consists of Vice President, Sales department, Customer Service Department, Engineering or production department, Accounting department and Administrative department.

Divisional Structures
This is the kind of structure that is based on the different divisions in the organization. These structures can be further divided into:

• Product structure – a product structure is based on organizing employees and work on the basis of the different types of products. If the company produces three different types of products, they will have three different divisions for these products.
• Market Structure – market structure is used to group employees on the basis of specific market the company sells in. a company could have 3 different markets they use and according to this structure, each would be a separate division in the structure.
• Geographic structure – large organizations have offices at different place, for example there could be a north zone, south zone, west and east zone. The organizational structure would then follow a zonal region structure.

Matrix Structures
This is a structure, which is a combination of function, and product structures. This combines both the best of both worlds to make an efficient organizational structure. This structure is the most complex organizational structure.

It is important to find an organizational structure that works best for the organization, as the wrong set up could hamper proper functioning in the organization.