Login
Copyright

What Is Organizational Structure of Management? - Types & Examples

An error occurred trying to load this video.

Try refreshing the page, or contact customer support.

Coming up next: What is Project Management? - Definition & Examples

You're on a roll. Keep up the good work!

Take Quiz Watch Next Lesson
 Replay
Your next lesson will play in 10 seconds
  • 0:00 Organizational…
  • 0:41 Flat Organizational Structure
  • 1:03 Functional…
  • 1:22 Product Organizational…
  • 1:45 Geographical…
  • 2:08 Lesson Summary
Add to Add to Add to

Want to watch this again later?

Log in or sign up to add this lesson to a Custom Course.

Login or Sign up

Timeline
Autoplay
Autoplay
Create an account to start this course today
Try it free for 5 days!
Create An Account

Recommended Lessons and Courses for You

Lesson Transcript
Instructor: Molly Gigli
In this lesson, we will provide an overview of the different types of organizational structures a company can utilize. Read on to learn why having an organizational structure is important.

Organizational Structure of Management

An organizational structure lays the foundation for how a company operates. It is a set of policies and rules that determines:

  • How an organization controls and delegates tasks and responsibilities
  • How decisions are made and implemented throughout every part of an organization
  • How information flows within an organization

Depending upon a company's needs, there are several organizational structures that can be used. Some common examples include the flat organizational structure, the functional organizational structure, the product organizational structure, and the geographical organizational structure. Let's take a look at these four structures in more detail.

Flat Organizational Structure

Typically, small companies with 20 or fewer employees will use a flat organizational structure that has very few levels of management between the chief executive officer (CEO), or president of a company, and the lower-level employees. As you might guess, this type of organizational structure allows for rapid decision making because there are only a few levels of management.

Functional Organizational Structure

A second type of organization structure is the functional organizational structure, which focuses on job functions or functional areas.

As you can see, companies use this type of structure when they want to organize their operations into departments, grouping employees with shared skills and knowledge, such as marketing or sales, together.

Product Organizational Structure

A third common type of organizational structure, the product organizational structure, is organized based upon a company's product lines.

Product Organizational Structure

This type of structure can typically be found in retail stores that are in multiple cities. Since this type of structure can be spread out into different locations, there may be a need to have support departments, such as marketing, operations, and finance, in each place as well.

To unlock this lesson you must be a Study.com Member.
Create your account

Register for a free trial

Are you a student or a teacher?
I am a teacher
What is your educational goal?
 Back

Unlock Your Education

See for yourself why 10 million people use Study.com

Become a Study.com member and start learning now.
Become a Member  Back

Earning College Credit

Did you know… We have over 95 college courses that prepare you to earn credit by exam that is accepted by over 2,000 colleges and universities. You can test out of the first two years of college and save thousands off your degree. Anyone can earn credit-by-exam regardless of age or education level.

To learn more, visit our Earning Credit Page

Transferring credit to the school of your choice

Not sure what college you want to attend yet? Study.com has thousands of articles about every imaginable degree, area of study and career path that can help you find the school that's right for you.

Create an account to start this course today
Try it free for 5 days!
Create An Account
Support