The correct corporate structure will allow you to run your business more efficiently. A business must decide the best structure to its goals and the industry. It should also evaluate its current structure and make any necessary adjustments. Any changes should be carefully made clear to employees, especially if the company is going through a reorganization. This can cause a sense of cynicism within the employees.
The top tier in the corporate structure is comprised of the executive officers and board members including the chief executive (CEO). The CEO is in charge of the day-to-day business operations and has control over nearly all business operations. The shareholders are also a part in the corporate structure, even though they aren’t involved in the day-to-day business operations. They are in charge of budgets and vote on major decisions.
Staff managers are subordinate to the direction of the board of directors. They collaborate with executives at higher levels to implement policies. Staff managers are organized into functional departments. This allows each department to function independently and improve efficiency. They can also be placed in divisional departments. This is a great option for companies with multiple products and need to respond quickly to market shifts.
A circular structure is similar to a functional or divisional structure. However, instead of the chain of command that runs vertically, this structure runs horizontally across departments. It is an effective way to promote communication and collaboration between departments. It also helps to build trust among employees as well as foster an atmosphere of teamwork.
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