Organizational structure is the outcome of the organizing process.The need for an adequate organization structure is felt by an enterprise whenever it grows in size or complexity. If everyone in a company is in their perfect place and knows his duties , in such cases company's activities will works with maximum results (output) and minimal costs (input) that is with full efficiency and effectiveness.As an organization grows, coordination becomes difficult due to the emergence of new functions and increase in structural hierarchies. Thus, for an organization to function smoothly and face environmental changes, it becomes necessary for the some to pay attention to its structure.This organizational structure consists of two types:
- Functional structure
- Divisional structure
An organizational structure provides the framework which enables the enterprise to function as an integrated unit by regulating and coordinating the responsibilities of individuals and departments. The span of management to a large extent gives shape ton the organizational structure. It is very necessary for an organization to define their powers and to avoid the duplication of functions. Organizational structure mainly depends on the development of the products.
Large multinational corporations require an organizational structure that can run the usual business functions. It is quite difficult for a multinational companies to create coordination among units which can be achieved through rules and procedures , the ways in which the units works.Through coordination one can easily achieve its stated goal.
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