The proper corporate management structure can help you run your business more efficiently. A company must determine which structure is best suited to its goals and industry. It should also examine its structure and make any needed adjustments. Any changes must be properly communicated to employees, in particular when the company is going through a reorganization. If not, it could result in employee cynicism.
The top tier of a corporation consists of the board of directors and the executive officers, including the chief executive officer (CEO). The CEO is responsible for the day-to-day activities of a business and has control over the majority of legal business operations. Shareholders also play an important role in the corporate structure, but they are not involved in day-today business. They are responsible for budgets, and have the ability to vote on major decisions.
Staff managers are below the board of directors. They collaborate with executives at higher levels to establish policies. Staff managers can be divided into functional departments, which permits departments to operate on their own and improves efficiency for a particular business function. They can also be placed in divisional departments. This is ideal for companies with multiple products and need to respond quickly to market changes.
A circular structure is similar to the functional and divisional structure but instead of having the chain of command running vertically, it is run horizontally between departments. It’s a great strategy to encourage collaboration and communication within departments. It can also create more trust among employees and help to create the idea of a team-oriented culture.
