Organizational Structure

There are two types of organizational structures that an organization can have, they are either a vertical structure or a horizontal structure. A vertical structure is a hierarchically structured organization where all management activities are controlled by a centralized management staff. This traditional type of organization often develops strong bureaucratic control over all organizational activities. A horizontal structure is an organization with few or no intervening levels of management between the top executive and the workers. This means that managers are much closer to their employees in this flat type structure than in a tall vertical structure. This allows for much faster transition times between problems that organizations have. An organization can also be centralized in these structures, an organizations with a centralized structure has several layers of management that control the company by maintaining a high level of authority, which is the power to make decisions concerning business activities. With a centralized structure, line-and-staff employees have limited authority to carry something out without prior approval. This organizational structure tends to focus on top-down management, whereby executives at the top communicate by telling middle managers, who then tell first-level managers, who then tell the staff what to do and how to do it. An organization can also be formalized in these structures. This means the extent to which rules and procedures are written out and enforced, organizations with high formalization, like bureaucracies, have strict enforcement of many set written rules and regulations. The next section deals with the strategic leadership of organizations and how it affects them.