How Do I Develop the Best Organizational Structure?

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  • Written By: Carrieanne Larmore
  • Edited By: Kaci Lane Hindman
  • Last Modified Date: 24 November 2018
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An organizational structure can best be developed by making sure it is complimentary to objectives and not overly structured. It also should include variance controls and support systems that allow employees to handle problems themselves instead of passing them on to others. There is not one best organizational structure since all businesses are unique in their objectives, strategies and corporate cultures. In order to develop the best organizational structure, businesses need to work with their strengths and weaknesses to create a structure that compliments their overall objectives.

Creating clear goals is one of the first steps in developing the best organizational structure for a business. These goals should include expectations for employees on how they handle decision-making situations, what means are available to them, and what continuous learning programs are available. After such goals are outlined, the business can begin to create an organizational structure that is complimentary to these goals. For instance, if one objective is for teams to handle problem-solving situations, then the organizational structure should be decentralized instead of hierarchal.

Overly structuring a business can result in dissatisfied employees and reduced moral. Adding flexibility into the organizational structure gives employees freedom to do their jobs more efficiently as technology changes or their skills advance. If using teams, only provide them with details on what the end result should be and only give critical information that is needed to complete the project.


Variance controls are key to developing the best organizational structure. These controls provide the support needed to employees who handle problems or issues at the point of contact. This details how far employees can go to look into a problem themselves and fix it as it occurs, rather than passing the problem on to another employee. For instance, an employee may be faced with a dissatisfied customer who wants a discount. In a situation such as this, it can be best to allow employees to handle the problems themselves in order to offer the best level of customer satisfaction.

Support systems should also be given close attention when wanting to develop the best organizational structure. This includes specific goals and how employees will be rewarded for reaching such goals. The organizational structure should have clearly defined expectations for employee behavior as well as how incentives will be distributed. Rewards should be fair, attainable and free of supervisor bias. There should also be no confusion about who is responsible for providing rewards to employees or about how they will be distributed.



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