How The Organizational Structure Of Companies Differ Around The World

Any organization must have an appropriate structure that will help achieve its goals. The structural makeup of the organization must align needs with goals to ensure that it progresses. The structure will also determine important decision-making options such as chain of command, centralization of control, span of control, etc. In general, enterprises follow two broad spectrums of organizational structure. Functional structures are highly departmentalized with narrow spans of control. This type is suitable for highly specialized operations with more focus on centralization. The chain of command is clear and obvious in this type of structure. Traditional structures are flatter, enabling decentralization and wide span of control. The chain of command is ambiguous and can sometimes be difficult to understand. The legal foundation of a company is different too, depending on the country where it is registered. Understanding the requirements of the operational country is essential to ensure that business policies align with government policies. The reporting requirements for organizational structures are determined by legislative rules. In the US, the reporting system must comply with VETS-100 requirements. The organizational structure laws of Singapore are very strict requiring companies to have a clear hierarchy and chain of command. Companies in Asia and Southern Europe follow the most centralized structure. Firms in Anglo-Saxon and Scandinavian countries follow a more autonomous structure. Organizations in the UK and US are mostly decentralized as companies struggle to find their place in a competitive market. Read less