What is an organizational setting and how is it structuredSo

What is an organizational setting and how is it structured?

Solution

It is the hierarchical arrangement of authorities, communications, rights and duties of an organization. It determines that how the roles and responsibilities are allocated, controlled, and coordinated, and how the flow of information between the different levels of management takes place.

This structure depends on the objectives of the organization and the strategy that it follows. In a centralized structure, the top layer of management has most of the decision making power and has tight control over departments and divisions whereas in a decentralized structure, the decision making power is distributed between different stages and the departments/divisions may have different degrees of independence. Companies like Proctor & Gamble that sells multiple products organize their structure in such a way that groups are divided according to each product and depending on geographical area as well.