Organizational structures outline a company’s internal operating environment. Many different structures exist, among them a geographic structure common in larger organizations or publicly held companies with multiple locations.
A geographic organizational structure is typically found in companies with operations spread over a large region, such as national or international offices. Each location will have its own internal structure and management layers, allowing them to run as a pseudo-independent operation.
Using a geographic organizational structure allows companies to use local, experienced individuals to run the company’s operations. This is most beneficial in international locations, where companies need help transitioning their operations to specific international markets.
Companies may find it difficult to run a geographic organizational structure because it does not allow for centralized decision-making. Business owners must rely on other individuals to take corrective actions and improve operations rather than giving a directive from the company’s main office or headquarters.