Hierarchical Structure: Different Types Of Organizational Structures

Large corporations tend to use hybrid structures because they have distinct advantages.

What is hybrid structure

The term hybrid means things created out of mixed elements. It is a type of structure which adopts both functional and divisional structures in an organisation at the same management levels. In other words, it is a combination or mix of divisional and functional structures. A hybrid organisational structure is a system to design the internal operating structures of companies that make use of different organisational structures rather than relying on a single one. Depending on the nature and type of the organisation this system may combine various elements of hierarchical structure along with bringing together a unique approach that

Functional Structure – It is a structure in which an organisation is divided into different departments or segments based on the functions they perform. In other words, functional structure groups various positions into functional units on the basis of similarity between expertise, skill and work activities. It is set up so that each area of the organisation is clubbed according to its function. It is best suited for small firms in which each department relies on the talent and knowledge of its workers working in it. Each functional unit has a separate set of duties and responsibilities. However, there are drawbacks to functional structure which is that the coordination and communication between various departments is very limited and sometimes restricted due to organisational

Divisional Structure – It is a type of structure which breaks down the company into divisions that are self driven. In other words, the teams are grouped in a set of departments where each department coincides with the end product or services offered by the company. Departments are grouped together according to their organisational outputs. Each department represents a separate business centre. The divisions which are formed have their own functional units like research, manufacturing, marketing, etc. It is less hierarchical in nature than its predecessor. Divisional structure is used in large firms that wide geographical area. The benefit of using this structure is that needs of the organisation can be met more quickly and more specifically. Communication is although restricted because employees in various divisions do not work together. iii. Matrix Structure – It is a type of structure in which reporting styles are set up as a grid or matrix rather it is like in traditional hierarchy. In other words, employees have dual reporting generally to both functional and product manager. This type of structure combines the departments seen in functional structures with project teams. In this employees work across other projects and teams as well as within their own department. The matrix brings together employees by function as well as