Organizational structure is the set of policies and procedures that companies follow in order to ensure continuous growth of the company. Small companies usually do not need any structuring as the business owner is the one handling multiple tasks at a time. However in large organisations, proper structuring is very important in order to ensure smooth workflow and timely achievement of goals. Many companies nowadays hire Organization Development Advisors also.
The type of organisation structure may depend upon various factors such as company policies, size, type of operations etc. Being one of the Organizational Development Consultants, we can say with certainty that organisational structure is a must and here is why :
Reason 1 : In order to Streamline Operations
Small companies have lesser number of tasks and hence everything can be done parallel with a little effort in lesser time. As the company grows in size, the number of operations increases and hence it is very important to prioritize and distribute each task in a right manner. A proper organisation structure ensures, that the work is distributed among various departments under the supervision of business owners, directors and managers.
Reason 2 : In order to improve Decision Making
Companies can use organization structure in order to improve the decision making process. A good organisation structure can ensure a streamlined flow of information right from the lower level to higher level and hence the decisions would be made keeping in mind the ground realities rather than assuming an ideal situation in mind.
Reason 3 : In order to operate in multiple locations
When the company expands and grows, it opens up in different locations. Visiting all the locations seem next to impossible for the business owner. In such situations, a proper organisation structure could help ensure that all the branches are run as per company standards and no compromise is being made in utilising the full potential of that location.
Reason 4 : In order to improve Employee Performance
A proper organisation structure is a must in improving the performance of employees. As far as an employee is not clear about his task, he won’t be able to give his 100% to it. Moreover, he needs continuous guidance from his seniors. A good organisational structure, not only ensures all this but also makes sure that the decision making is participatory and inclusive.
Reason 5 : In order to improve Customer Sales and Increase Sales
Companies that use a well-defined organization structure remain more focused towards customer service rather than wasting their time on petty operational issues. When responsibilities are clearly defined and identified, the chance of errors reduces and hence customer satisfaction increases and a satisfied customer would ultimately lead to increased sales.