Corporate Management Structure
The proper corporate management structure is critical to running a successful business. A company must determine the best structure to its business goals and industry. It should also examine its structure and make any necessary adjustments. Any changes must be made known to employees, particularly when the company is going through an organizational change. It could cause a sense of discontent among employees.
The top tier of an organization is made up of the executive officers and the board including the chief executive (CEO). The CEO is responsible for the day-to-day business operations and has authority over nearly all business activities. The shareholders also play a part in the corporate structure, even though they aren’t involved in the day-today operations. They are accountable for budgets and are able to vote on major decisions.
Below the board of directors are staff managers who work with the top executives to establish policy. Staff managers can be divided into functional departments, allowing departments to operate on their own and improves efficiency for a specific business function. They may also be put together in divisional departments. This is ideal for businesses with a variety of product lines and have to adapt quickly to market trends.
A circular structure is similar to a functional and divisional structure however, instead of having the chain of command run vertically, it is run horizontally between departments. It is a great method to encourage communication and collaboration between departments. It can also help to build the culture of teamwork as well as trust among employees.
