What is the meaning of organizational structure

What is Organizational Structure

The organizational structure is fundamental in all companies, it defines many characteristics of how it is going to be organized, it has the main function of establishing authority, hierarchy, chain of command, organizational charts and Departmentalization, among others.

Organizations must have an organizational structure according to all the activities or tasks they intend to perform , through a correct structure that allows them to establish their functions, and departments in order to produce their services or products, through an order and adequate control To achieve your goals and objectives .

For an organizational function to exist and have meaning for individuals, it must consist of:

  • Verifiable Objectives
  • Clear ideas- duties
  • Precise authority level command unit.
  • Information-supplies

Therefore, we consider the organization as: Identification and classification of the required activities.

What is Organization

It refers to the establishment and grouping of necessary activities and resources that interact with each other through horizontal and vertical coordination for the fulfillment of the objectives contemplated in the structure of the company.

Objectives of an organizational structure?

It should be designed to determine who will perform what tasks and who will be responsible for what results; to eliminate the obstacles to performance that result from confusion and uncertainty regarding the allocation of activities and to build networks regarding decision-making and communication that respond and support business objectives.

Types of organizational structure

The structure is the fundamental basis of the company where the divisions of the activities are carried out to form departments and subsequently define the authority in order to achieve the objectives but also everything that arises spontaneously from the interaction between the members. Taking into account these two aspects, the structure is mainly divided into informal and formal forms.

Formal structure

This formal structure arises as a necessity to realize a division of the activities within an organization that allows them mainly to reach the objectives through organizational charts, manuals and the interaction of the principles of the organization as the division of work, authority and responsibility, delegation, command unit, hierarchy, control section and equity in the workload, among others. Figure 1 shows that the formal structure is integrated of the parts that form an organization and their relationship to each other through the fundamental principles of the organization that are established with the help of the tools and are presented in verbal form or documents publicly where some of the members can consult, how the formal structure of the organization is governed.

Informal Structure

It is a network of personal and social relationships not established or required by a formal organization but that arises spontaneously from the association between people. Eg Basket game, group of friends, study group, family reunions, Christmas party.

Its origin is in the formal structure since the formation of structures of the relations between the members according to a mixture of factors, where some are observed, give rise to this type of structure.

The informal structure obeys the social order and these are usually more dynamic than the formal ones. It is observed that the informal structure is integrated through relationships between people according to a mixture of factors that arrive to form informal groups that are verbally represented publicly.

Types of organization charts

According to Enrique B. Franklin a) By type of nature they are divided into three types:

  • Microadministratives: This organization chart is only for one organization and can be a general organization chart of the entire company or just one area.
  • Macro-administrative: This organization chart involves more than one company
  • Mesoadministrativo: It involves one or more organizations but in the same direction.

b) For its purpose
They are integrated by four subcategories:

  • Informative: This type of organization chart is designed to be disseminated publicly, so that anyone can view them.
  • Analytical: This organizational chart is of an analytical nature of organizational behavior.
  • Formal: It is from the legal point of view when the representative or partners determine the structure of the organization and it has an instrument.
  • Informal: This organization chart contrary to the previous one does not have such a written instrument.


“Organizing is the technical structuring of the relationships that must exist between the functions, levels and activities of a company’s resources.”

The company can be organized by different factors, product, customer factor, geographic, functional and project reasons.

  • Due to the functional area: It is when they are organized according to professional profiles of specialty.
  • By reason of the client: The organizations structure according to the type of client a very clear example are the department stores.
  • Because of the products: Generally it is in companies that have a wide variety of products, these companies are organized according to the type of product a very common example of this type of departmentalization are grocery stores, or large supermarket chains
  • Due to the geographical location: It is according to the areas or territories where these companies carry out their operations.
  • Because of the project: They have a matrix structure every time they generate projects they establish new modifications, an example of these are the construction companies that work for projects.

Job Specialization

The specialization of the work is carried out through the division of tasks, where it is sought to achieve that a collaborator is an expert in his position to be more productive since it was thought that it was not possible for a person to dominate all areas of a job. organization.Nowadays companies are looking for people with a good attitude to acquire more knowledge of what their position needs or who have “multi-abilities”.

“Organizing means establishing structures of the roles that individuals must play in the company.Assign tasks necessary for compliance”.

Task Grouping

The tasks or activities of the company must be classified by the different areas and take into account the type of workload that will be established for a collaborator.

These should be established as previously mentioned according to different variables such as the type of capacity, technical knowledge and that is proportional to the worker’s compensation.

There are different tools that help to group tasks, such as time and movement studies, job analysis among others.To make the grouping it is advisable to first make a division by large areas, for example: finance, human resources, production, marketing, among others, and then perform another subcategory or division of these areas according to the organization’s tour the names may vary so as the number of subdivisions.

Hierarchy and chain of command

This principle tells us about the division of that of the organization that exists in every group and human organization.Once grouped the tasks begin to be classified into large areas;This activity is the responsibility of the administrator or whoever is carrying out the organizational plan. He will mainly have to determine which employees depend on who or which department depends on another;in the same way they vary according to the turn of the company, size, number of people, and the relationships that link the areas.

In the chain of command it mainly establishes: the authority, responsibilities and unity of command.

This hierarchy and chain of command process is undergoing changes according to the growth of the company, generally all companies are born without a defined structure, and as they grow they add members until the owner begins to divide the areas and the person in charge of what. There is a classification for the type of growth of the organization, as horizontal and vertical as described below:

  • Horizontal growth: they serve up to a certain limit where employees require the support of others who also depend on them to fulfill the plans.
  • Vertical growth: As the company grows and collaborators are added and more areas or departments are opened to a point where it does not have a correct division within the organization.

Control amplitude

This is very similar to the previous one only that quantifies the units, departments or people that are supervised by another person, some theories establish the number of maximum people who can be in command of another, but it is very important to know and even more today With the computer systems that allow more control over some areas, the smaller the number of people who depend on one, the communication and control of them will be easier and more efficient, than contrary to more people you can lose the control and generate chaos.

Future work

Tool through a methodology for the establishment of potential organizational structures for newly created companies for their entry and growth in the global market.


The organizational structure allows us to achieve the goals and objectives of the company as it establishes the fundamental bases such as division of labor, departmentalization, control of command and hierarchy.

It is important that companies have a structure, regardless of its size and that it is also designed according to what they intend to do and where they want to go to allow them to achieve objectives.Besides that it is not there that we lose sight of the structure of the organization,when it is being designed, it must be flexible and adaptable to the growth of the company.