Having the right corporate management structure is critical to ensuring efficient business operations. A company must determine which type of structure best suits its needs and the industry. It must also assess its structure and make any necessary adjustments. All changes must be communicated to employees, particularly when the company is going through an organizational change. It can lead to cynicism among employees.
The top tier of an organization is made up of the board and executive officers including the chief executive (CEO). The CEO oversees daily business operations and has control over virtually all legal business operations. Shareholders also play an important role in the corporate structure but they are not involved in the day-to-day business. They are in charge corporate management structure of budgets, and they can also vote on major decisions.
Under the board of directors are staff managers and work with top-level executives to implement policies. Staff managers can be organized into functional departments. This allows each department to function independently and improve efficiency. They can also be organized into divisional departments, which is ideal for companies with a variety of product lines that require quick responses to market shifts.
A circular structure is similar to the functional and divisional structure however, instead of having the chain of command running vertically, it runs horizontally between departments. It is a great way to foster collaboration and communication within departments. It can also create more trust among employees as well as foster the idea of a team-oriented culture.