The task of designing or redesigning an organizational structure could seem overwhelming. Where do you begin? Look at the essential positions in your business and determine the best way to arrange them so that employees will work in a climate conducive to productivity and so your organization will be more efficient.


One way to approach the job of implementing an organizational structure is to start changing the existing diagram. An organizational structure shows the hierarchy of reporting relationships in a firm. For example, the president or director is at the top of the diagram and the management levels are listed in consecutive layers. Employees with the lowest level of responsibility fall at the bottom of the chart. In a flat organization, there are few, if any, levels and employees have more authority within the scope of their job descriptions.

Major Processes

Public and private organizations must examine how they currently operate, especially to meet customer needs, and make a list of core processes. These are connected procedures that produce a final outcome, such as a customer getting an end product or service. In an organizational redesign, the management must ask tough questions about each core process. For example, examine if the core process is effective and if the standards that employees must meet in that process are producing high-quality outcomes for customers.


The ways positions are arranged influences the culture of an organization. For example, positions at the top of the structure will typically have the most power, and people will jockey for those positions. These positions are also sought by people from outside the organization. To change the culture could mean changing how power is distributed. An organization's leadership could decide to change from a vertical structure, with power at the top of the ladder, to a team structure. Team leaders might report directly to the top officer of the organization. Such a change would require managing employees' tendency to reinforce the status quo -- or business as usual -- and to get them on board with supporting the new structure.

Managerial Processes

The managerial processes and the expected behaviors of employees working under managers are the practices that keep an organization's operations running smoothly. An example of a managerial process involves planning, budgeting, staffing and measuring employee performance. Before establishing or changing an organizational structure, the leadership must look at the present structure and current levels of efficiency by department. They must perform a cost-benefit analysis for each proposed change to the structure. They must decide whether moving experts from one core process to another core process will result in greater efficiency. Communication is the key to implementing a structure -- including informing employees about intended changes and the timeline for implementation. Employees also need to understand their new roles so they can adapt their behaviors to support the new organizational structure.