Definition of network organizational structure

The organizational structure of a company is the formal and informal framework of organizational policies, such as hierarchical levels, lines of communication and reporting, and the rights and responsibilities of employees.

Facts

A network organizational structure is more complicated and complex than any other structure because it is consists of multiple organisations that work together to produce goods or provide services.

Significance

An organizational structure should reflect the appropriate culture the company is trying to instil in their workplace; this is crucial in a network structure because organisations are accountable for the business ethics of all partners in their supply chain.

Function

The primary function of an organizational structure is to complement and support the business strategy used to accomplish the objectives and goals of the organisation.

Benefits

Network organizational structures are flexible and highly efficient because of the selection and use of the best partners available that provide specific needs.

Warning

Network structures are susceptible struggling because of the over-reliance on partners, resulting in less managerial control on every stage of the supply chain.

Cite this Article A tool to create a citation to reference this article Cite this Article

About the Author

Shane Thornton has published business-related on eHow.com. In addition to business, his other areas of interest include sports, traveling and entertainment. He earned a Bachelor of Science in Business management from Arizona State University’s W.P. Carey School of Business.

Try our awesome promobar!